2024 VC Survey“We have the right entrepreneurial and innovative spirit to fight the anti-Israeli movement”
2024 VC Survey
“We have the right entrepreneurial and innovative spirit to fight the anti-Israeli movement”
Mobilion Ventures joined CTech for its 2024 VC Survey to share how the country can combat the rising anti-Israel sentiment across the world
“We can already identify the beginning of the anti-Israel spirit entering the big global corporates and influencing their decision-making, halting new initiatives and potential investments. We should not take it lightly as this can be major over time,” explained Mobilion Ventures. The firm is an early-stage Venture Capital Fund that invests in Smart Mobility technologies with a special focus on sustainable, digital, and urban mobility solutions and operates in EU-Israel.
“In the long run, I believe that we will see the Israeli high-tech recovering from that as we did in past, post-geo-political events. We have the right entrepreneurial and innovative spirit to fight the anti-Israeli movement but it’s going to take its toll,” the team added.
The VC fund joined CTech for its 2024 VC Survey, and you can learn more about them below.
VC Fund ID
Name of the fund/funds: Mobilion Ventures
Total assets: $20M+
Leading partners: Nexus Automotive International, Mitsubishi Corporate, Phinia
Latest investments in Israel: Capow, DriveU, Connected Insurance
Selected portfolio companies: Click-ins, Algolion (Acquired), Carteav, RideVision, Silib, Clearly and many more.
From your perspective, was 2023 a ‘lost year’, or can the events that happened during it be seen as a springboard for opportunities in 2024?
2023 wasn't an easy year for Israeli startups seeking investments, but we see that many of the early-stage startups were less affected by the circumstances in Israel, as they shifted their focus to partnership-building with global players.
We believe that in the long term, the Israeli startup ecosystem will thrive and grow from these challenging times. Since the beginning of 2024, we can already see an increase in the potential M&As in Israel and hear about more startups that are fundraising despite the current situation.
What do you believe is more crucial to the state of Israeli tech: the influence of global processes and the global economy, or the local events ranging from the political protest to the war state?
I believe that local events such as the war and the political unrest have the biggest influence on the Israeli high-tech ecosystem: Are startups going to stay here in Israel? Would they be able to hire talent and grow here? Operate from Israel or open offices abroad?
The country level has a higher importance for nurturing and growing startups, and at the end of the day, it is a local competition over global opportunities so if the local environment is not favorable then the investors will go elsewhere.
Has the prestige of Israeli high-tech been damaged, or are the protests and the war merely a 'small bump in the road' from which the sector can recover within months?
We can already identify the beginning of the anti-Israel spirit entering the big global corporates and influencing their decision-making, halting new initiatives and potential investments. We should not take it lightly as this can be major over time.
In the long run, I believe that we will see the Israeli high-tech recovering from that as we did in past, post-geo-political events. We have the right entrepreneurial and innovative spirit to fight the anti-Israeli movement but it’s going to take its toll.
How much effort was required of you to maintain the fund's status with your investors in 2023? What were their primary concerns and how did you address them?
We spoke with all of our investors when the war started and explained the situation.
We explained that our small team in Israel is not in a war zone, therefore, we continued to work (almost) as usual, to support our startups and continue our development efforts. Their main concern was ensuring we, and the startups, were safe and understanding how it affected the fund's overall activity, which in our case, was limited.
How are you preparing for the most pessimistic scenarios, such as the continuation of the war in Gaza deep into 2024, the opening of another front in the north, or further reduction of government support for high-tech?
Our approach is to focus and showcase the current investment opportunities and disregard the “noise” of the geo-political situation as much as possible. In addition, our EU (Paris) office is set to be more active in the near future if the situation will further deteriorate.
Did you raise fund money in 2023 for an existing fund or a new one? What are your expectations regarding this matter for 2024?
We didn’t raise a new Fund in 2023.
As a global fund with a branch in Paris, we see that having an additional branch in the EU helps us work with investors, explain the situation better, and make better investment decisions as we have a broader overview of the market.
We expect 2024 to be a better year for fundraising as the current valuations are lower and there is a huge advantage for investors to make good investments now in early stages.
How many investments did you make in 2023, and how does it compare to 2022?
In 2023 we’ve made two new investments compared to 3 in 2022, and most of our 2023 investments were in existing portfolio companies.
In your view, will the amounts and/or the number of deals in 2024 be more like those of 2023 or 2021-22?
I believe that 2024 will be slightly (15-20%) higher than 2023, as we already see some recovery in investments, but still way back from 2021-22 numbers. Off course, if the geo-political situation will change in the next few months, either way, this will also be reflected in the overall annual numbers.
Which high-tech sectors will you focus on in the upcoming year? Which areas will maintain their prominence, and which ones appear less attractive?
As we focus on the Mobility/Autotech domain my answer will be focused on that sector - I believe that Sustainable Mobility and even new energy solutions to mobility will continue to grow dramatically and focus the attention of investors and corporates. For example, the interface between the energy grid and the EVs is rather in high demand for additional solutions.
In addition, further digitalization of additional activities in the transportation value chain and the creation of supplementing digital services in mobility will increase as the need for new ways to move people and goods faster, smarter, and more efficiently only intensifies.
On the other hand, further pure autonomy solutions will continue to slow down as the markets are yet ready for this monumental shift. In this area, we see more activity towards more advanced and better safety systems (ADAS and additional solutions) as well as the adoption of automation in low-speed operational fleets.
Which type of companies in the Mobility domain stand a better chance of garnering increased attention from VC funds this year - early-stage or advanced rounds?
The late-early growth stages would be in a better position than other stages to attract attention from new investors. On the other hand, very early stages (pre-seed and seed) are less likely to find new investors or growth-stage companies if they do not have significant revenue growth. At times of uncertainty, the investors’ appetite for additional risk-taking diminishes and they are looking for good opportunities that already show initial validation from the markets. These post-initial validations are mostly concentrated in the A-C stages.
Do you think it is likely we will witness encouraging IPOs, the emergence of unicorns, or remarkable exits in 2024?
We think that a new cycle of IPOs in the Capital Markets is around the corner, as the interest rates will start to be gradually reduced globally. We believe that by the end of the year, we will see this been validated by a few leading companies making their IPOs. Yet the real opening of the IPO option will be only in 2025, and maybe only in the second half of the year. Alongside the IPO market, we believe that the M&A market in the automotive industry will be very strong this year as many automotive companies need to show better bottom-line results in 2024 and this will fit their short-term strategies.
What changes will you implement in your approach to evaluating investments in startups in the coming year, compared to the previous two years? What practices will you abandon, and what criteria will you now demand from founders?
Our evaluation processes this year is focused more on validation and partnership creation by the candidate startups.
I believe that founders’ agility will also be a huge factor in the near future - understanding that they can adjust to the market trends and conditions and willing to consider relocation if needed
Provide an example of an intriguing investment you made in 2023. What sets this company apart, or what is distinctive about its sector?
We’ve invested in 2023 in Clearly Earth – an Israeli-UK company that aims to be the leading solution for real-time measurement of transportation emissions and enable the transportation sector to reach net-zero goals. The company has already validated its solution and business model in the NA market with two leading customers and is now set to grow and implement this solution with major fleet operators worldwide.
What is unique about this company is that it offers fleet operators a real measurement solution at trip/vehicle level that unlock three level of benefits:
- Taking actions to improve the efficiency of operation.
- Enabling making scope 2 and 3 reporting for all regulatory and financial purposes
- Carbon Trading based on the measured activity.
We are very active in the sustainable mobility domain, and this is the most interesting solution in this field we’ve seen in the last couple of years.
Practical and current tips for founders planning upcoming money-raising efforts:
- Partner – find the best potential globally known partner to validate your solution and act as a channel to market.
- Reach out to the most active Funds/CVCs that are investing in related solutions to your company (competing or complementing)
- Try to sharpen your value proposition & offer an appealing short-term proposal that is also time-framed – so that it will create a FOMO reason to invest now, and not in later stages.
Name two portfolio companies that you think will thrive in 2024:
Click-Ins
Description of Product: The company is providing a mobile-based solution for automated vehicle damage detection with a focus on three main markets – Fleet operation (check-in/out), Insurance (underwriting and claims), and used car and dealership operations.
Year of Founding: The company was established in 2014 by Eugene Greenberg (Chairman) and Dimitry (Dima) Geyzersky (CTO) and its technology was focused on providing solutions in the HLS sector, but then pivoted to Autotech in 2020.
Funding: The company raised its A Round in Nov. 2021 with Mobilion leading this investment round. The total investment amount in the company until today is approximately $15M.
Why it’s their year:
The company is set to have a breakthrough this year, having already established its competitive advantage in the last two years. This year it will focus on growth in its domain markets and mostly in North America, thanks to its new partnership with OpenLane - a leading operator of digital marketplaces for wholesale used vehicles and the team's expansion in the US.
Capow
Description of product: Its technology is focused on providing a unique in-motion (dynamic) power solution for industry automation and vehicles based on multiple patents in this field.
Year of Founding: The company was established in 2018 by Prof. Mor Peretz (CEO) and Dr. Eli Abramov (CTO)
Funding: The total investment amount in the company is – $7.5m. The company raised its Seed Round in Aug. 2022 with Mobilion co-leading this investment round.
Why it’s their year:
The company is set to have a breakthrough this year as it has already established its solution with few initial OEM/Tier1 customers for the previous year. This year it will focus on expanding, its initial client base and growing its pipeline of customers in its North American market.
