Israel’s stock-market releases TASE UP, a hi-tech investment platform

‘90% of the money invested in Israeli start-ups comes from other countries,’ CEO Ittai Ben-Zeev said on Sunday.

By HAGAY HACOHEN
Investment [Illustrative] (photo credit: PIXABAY)
Investment [Illustrative]
(photo credit: PIXABAY)
Despite Israel being lauded as the Start-Up Nation, 90% of the investments in that market come from non-Israelis, Ittai Ben-Zeev told the media on Sunday. This is what TASE UP means to change.   
A new investment platform, TASE UP (TASE being the acronym for Tel Aviv Stock Exchange) intends to make the stock market into something new. “The stock-market wants to be the new meeting point between investors and hi-tech firms,” Ben-Zeev said.  
Most Israeli companies view success as being bought up for a hefty price.
Mobileye, for example, was bought by Intel three years ago to the tune of $15.3 billion. The computer chip giant followed with its Habana Labs $2 billion 2019 purchase.
Such deals are fantastic for those who invested in Mobileye and Habana Labs, but the companies are no longer Israeli.
When asked, 85% of hi-tech workers thought the government should offer incentives to keep companies here and over half expressed their preference that companies remain in Israeli hands: Hence, TASE UP. 
As the companies on the platform are just starting out, they are not yet public, so they can’t sell shares on the stock market and raise money that way.
This means that during the COVID-19 pandemic, firms with good ideas might not be able to raise enough capital to achieve their goals and will need to close.
The TASE UP logo (Photo: courtesy)
The TASE UP logo (Photo: courtesy)
TASE UP allows Institutional and accredited investors to invest in these companies right now, bypassing the formal vetting process required to get into the stock exchange. 
In Israel, an accredited investor is a person with NIS 8 million ($2.35 m.) worth of assets whereas in the US it’s a person with $1 million – less than half that amount.
Institutional investors manage public money such as pension funds; TASE UP is meant for institutional investors who have at least NIS 50 million. 
To encourage such investors, the state will guarantee to return 40% of the original investment should things go badly. This innovative step is the result of a shared effort by the Israel Innovation Authority, the Finance Ministry, the Capital Market Authority and the Israel Securities Authority.
Ben-Zeev told reporters this proves how vital making capital available to hi-tech companies is in the eyes of the state. He did not explain how the state intends to return investors nearly half their money should the company they are investing in flop.
“We are doing a crucial move here to ensure that Israeli hi-tech will emerge a winner,” he told reporters. 
TASE UP is partnering with Jefferies, an international investment bank; crowdfunding investment platform Fundit; and digital insurance platform Novus to ensure that Israeli innovation will not be deprived of investments during the COVID-19 recession. 
The launch of TASE UP is accompanied by a video-ad campaign with comedian Adi Ashkenazi who jokes that “What’s Hi-Tech, I-Take.” 
Another joke in the video is that Ben-Zeev attempts to convince Ashkenazi that hi-tech isn’t her strong suit – perhaps mimicking the concerns of traditional investors new to the field – but only to be proven wrong.


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