Israeli VC investment reaches pre-crisis level

83 Israeli venture capital-backed companies raised in the first quarter, up from 72 in the corresponding quarter.

By YOSSI NISSAN/GLOBES
Money Shekels bills 521 (photo credit: Courtesy)
Money Shekels bills 521
(photo credit: Courtesy)
Israeli venture capital-backed companies raised $342 million in the first quarter of 2011, according to the quarterly PricewaterhouseCoopers Israel MoneyTree Report. That figure is double the amount raised in the corresponding quarter of 2010, and 34 percent more than what was raised in the preceding quarter. This was the largest amount raised since the collapse of Lehman Brothers in September 2008.
Eighty-three Israeli venture capital-backed companies raised in the first quarter, up from 72 in the corresponding quarter and 74 in the preceding quarter. The average investment in a company rose to $4.1 million in the first quarter from $2.4 million in the corresponding quarter and $3.5 million in the preceding quarter.
The largest amount of capital – $75 million – was invested in Internet start-ups in the first quarter; the largest quarterly amount ever invested in this sector. Three investments accounted for 65% of the total.
PricewaterhouseCoopers Israel partner, High-Tech Assurance Practice, Rubi Suliman said, “In this quarter we saw a record number of exits by venture capital backed companies, which is no wonder given that the number of investments has grown and returned to the investment levels before the credit crisis. We haven’t yet seen the peak of the current period. We can expect to see a large number of Israeli and foreign follow-on funds bring new money to Israeli high-tech investments in the coming year and to develop the next generation of companies for the coming decade.”