IVC Research Center has released the findings of their quarterly survey, summarizing Israeli capital raising in Q4 2008. Israeli companies raised $394 million in the last quarter, a decline of 22% compared to the equivalent period in 2007. That said, 2008 was a record year for Israeli high tech capital raising, reaching a peak of $2.08 billion, an eight year record, second only to the peak of the first dot com bubble in 2000 which then reached $3.09 Billion.
Key messages from the report show good news and bad news:
- 109 Israeli companies have raised $394 million during Q4 of 2008
- The international funds are responsible for most of the growth. In 2005 for every Israeli Dollar international funds raised $1.04, in 2008 however, for each Israeli Dollar spent International funds invested $1.66, which is also a 7 cent increase compared to 2007.
- Israeli funds invested $780 million in Israeli high tech companies during 2008, only 38% of the total sum, and less than half of the $2 Billion the VC industry is ‘sitting on’
- The average financing round was $3.61 million, compared to $4.37 million in the fourth quarter of 2007 and $4.83 million in the previous quarter.
- Seventy-six companies attracted more than $1 million each. Of these, 18 companies raised $5 million to $10 million each, nine companies raised $10 million to $20 million, and one company raised over $20 million.
- Seed investments were down 3% compared to last year, attracting only $104 million, invested in 70 companies.
To end on a positive note, Zeev Holtzman, Chairman of IVC Research Center and Giza Venture Capital, said:
2009 will be a tough year for all companies, yet Israeli high-tech industry will continue to be a highly abundant source of technology innovation.
The full report can be found at IVC Online.
I'm a former general partner at google ventures, head of Google for Entrepreneurs in Europe and founding head of Campus London, Google's first physical hub for startups.
I'm also the founder of Techbikers, a non-profit bringing together the startup ecosystem on cycling challenges in support of Room to Read. Since inception in 2012 we've built 11 schools and 50 libraries in the developing world.
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