Israeli Tech Continues to Draw More Money in Fewer Rounds

The number of Seed rounds raised by Israeli startups fell to a five-year low in the third quarter of 2018, as more money continued to flow to fewer firms

In the first three quarters of 2018, Israeli companies raised $4.54 billion in total across 444 deals, which is 82% of the total amount raised in 2017, according to a new report published Monday by Israel-based market research firm IVC Research Center Ltd. and Israeli law firm Zysman Aharoni Gayer & Co. (ZAG S&W).

 

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The trend seen in previous quarters—larger sums but in fewer rounds, continued. The number of funding rounds of over $20 million continued to increase in the third quarter of 2018, while the number of rounds below $5 million continued to decline. The number of Seed rounds fell to a five-year low, and the number of A rounds remained low, while more advanced rounds remained at high levels, according to the report.

 

Tel Aviv Stock Exchange. Photo: Bloomberg

In total, Israeli tech companies netted $1.6 billion in investments in the third quarter over 131 deals, which amounts to a 33% decrease in the number of deals compared to the equivalent quarter in 2017.

 

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Larger deals registered in the third quarter include a $125 million round raised by retail analytics company Trax Image Recognition, and an $83 million round raised by insurance firm Next Insurance Inc., both announced in July. In September, business intelligence firm Sisense Ltd. announced an $80 million funding round, and medical diagnosis startup MeMed Diagnistics Ltd., announced a $70 million round.