2015 is shaping up to be a great year for investments in Israeli start-ups. This can be seen from the fact that in the past few months leading Israeli venture capital firms have closed new financing. These funds include Carmel Ventures, Magma Venture Partners, Jerusalem Venture Partners (JVP) and outgoing partners from Greylock Partners Israel. If you add new funds raised by Glilot Capital Partners, Canaan Partners Israel, and Ilan Shiloach's First Time, it means that $855 million was raised over the past six months and most of this will reach Israeli start-up entrepreneurs.
These are not the final amounts because some of the funds have not yet been closed. Magma Ventures has completed its $150 million fourth fund and will soon begin investing in Israeli start-ups. This fund comes just two years after the third fund, and is expected to invest up to $6 million in seed and Series A financing in 25-30 enterprises. Magma was founded in 1999 by Yahal Zilka and Modi Rosen who manage it together with Shraga Katz, Zvi Limon, Shahar Tzafrir, Ran Achituv, and Adi Yarel-Toledano. Magma's most famous exit was Waze, which was sold to Google, while other exits include Onavo's sale to Facebook, Provigent's sale to Broadcom, DesignArt's sale to Qualcomm, and Wintegra's sale to PMC-Sierra. These companies, the fund claims, created accumulated value of more than $2 billion.
One month after Magma's new fund, at the end of October, Carmel Ventures also announced that it had closed its fourth fund totaling $194 million. Carmel is one of Israel's biggest and oldest funds and the announcement came after it had already invested in several start-ups including $3 million in PlayBuzz and $1.6 million in LuckyFish.
Investors in Carmel's fourth fund include high profile Asian names such as China's Baidu. Carmel's most important exits include the sale of Kontera to Israel's Amobee (owned by Singapore Telecom), DesignArt sold to Qualcomm, CooperGate sold to Sigma, and Wanova sold to VMWare. On paper, Carmel has some outstanding investments with major potential for exits over the next year or two including ironSource, eXelate, myThings, Payoneer, and Clarizen.
Also at the end of October, JVP closed two funds worth $160 million led by partners Gadi Tirosh and Kobi Rozengarten. Over the past year, JVP has put major stress on cyber security encouraged by the successful IPO of CyberArk Software Inc.(Nasdaq:CYBR), which has a market cap of $1.1 billion.
In recent years, JVP has had successful exits from XtremiO and Cyoptics and its portfolio contains promising companies like Reduxio and Cyactive.
Yesterday, the outgoing partners of Greylock Israel joined the finance raising party, having completed a $200 million fund, which marks their separation from Greylock. The partners - Arnon Dinur, Yoram Snir, Erez Ofer and Laurel Bowden, who manages Greylock's European office, will continue to invest in Israeli and European start-ups through the new fund, which will soon be unveiled.
This is the final stage on a process that began with the first fund that was a branch of Greylock US in Israel, while the second fund was an independent Greylock Israel fund, and now the third fund is completely independent.
Over the years, Greylock Israel has invested in start-ups such as mysupermarket, Payoneer, Wonga, CoolaData, and Via. Exits have included the sale of Wanova to VMWare, the sale of ScaliO ti EMC and more.
In addition to these four large funds there have been several smaller funds. For example, Glilot Capital is close to completing to raise a $70 million second fund. Glilot Capital was founded by Kobi Samboursky and Arik Kleinstein who have been joined by Sallai Meridor, Aaron Abramovich and Gordon England.
The first fund has had two exits to date - Aorato, which was sold to Microsoft for $200 million and Insightera, which was sold for $30 million.
Another fund, which has raised funds is Canaan Partners Israel, an independent branch of the global fund, managed in Israel by Izhar Shay and Ehud Levy. They plan to raise $30-40 million. The fund's successes in Israel include the exit of PrimeSense and its current investments include N-trig and LiveU.
Yet another fund is Ilan Shiloach's First Time. Shiloach is also behind thetime incubator and he is one of the prominent investors in Matomy Media Group (LSE:MTMY). The company has so far raised $50 million to invest in start-ups.
Alongside these funds which have raised so much money, others have been unable to succeed. These include Gemini Israel Ventures whose partners decided last year to raise another fund, while Evergreen Venture Partners is not raising another fund. Genesis Partners has been in the process of raising another fund for some time but has yet to close the financing.
Published by Globes [online], Israel business news - www.globes-online.com - on January 5, 2015
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