JVP celebrates 25 years of investments, exits and returns

In a special report presented to investors at its annual conference, JVP summarized its activities to date.

JVP team (photo credit: NOAM FEINER)
JVP team
(photo credit: NOAM FEINER)
Israeli venture capital fund Jerusalem Venture Partners (JVP) launched its silver jubilee celebrations on Wednesday, marking 25 years of catalyzing economic growth in the heart of the capital city.
In a special report presented to investors at its annual conference, JVP summarized its activities to date, accelerating innovation across Israel and delivering healthy financial returns to its investors.
Founded by Dr. Erel Margalit in 1993, who currently serves as executive chairman, JVP manages funds worth $1.4 billion, has established more than 140 companies and completed 35 exits to date – including 12 Nasdaq IPOs totaling more than $20b.
According to the report published Wednesday, JVP has delivered an average return of 4.8 times the value of initial investment on companies that later secured exits. The venture capital fund has focused its attentions on a wide range of emerging trends, starting from telecommunications in the 1990s to increased emphasis on big data, deep learning, artificial intelligence and food-tech in recent years.
“Over the past 25 years, JVP has spearheaded revolutions that have shaped Israel into a global tech leader,” said Margalit. “Looking to the future, to the next 25 years, our goal is to ensure Israeli start-ups become global market leaders. We know that if innovation can change a country like Israel, it can change a region, and serve as a bridge to the entire world.”
Among the dozens of start-up exits orchestrated by JVP since its creation, numerous have turned into “unicorns” – referring to start-ups reaching or exceeding a $1b. market value.
Seven JVP-backed unicorns, the report revealed, have boasted a return of more than 10 times their initial investment, including Netro (worth $5.5b.), Chromatis ($4.8b.) and CyberArk ($4b.). Wireless communications company Netro, which was acquired by SR Telecom in 2003, delivered a return of almost 109 times the initial investment.
The report also highlights JVP-backed exits that have led to the establishment of innovation and R&D centers by leading multinationals in Israel. Major corporations including Alcatel, Salesforce, PayPal, Sony and Walmart have all established local innovation centers following the acquisition of JVP portfolio companies.
Data also showed significant diversity among both the sector and geographical origin of investments. While technology groups made up 30% of investments, other leading sectors funds included insurance companies (15%), pension funds (11%), corporates (9%) and sovereign funds (8%). Approximately 37% of investments originated from the European Union, followed by 34% from the US and 29% from Asia.
Diversity is also a key theme in the management of the fund, where over half of the partners at JVP are women.
While firmly based in Jerusalem, JVP has created centers of excellence across the country – in Beersheba, the Galilee and Haifa. Recently, it has expanded its operations to New York City with the establishment of the city’s first international cybersecurity investment hub.
Today, the fund’s offices, technology incubator and entrepreneur hub are all based at its Jerusalem Media Quarter, near the city’s First Station complex. According to JVP, their investments have assisted the creation of more than 20,000 new job opportunities in the city.
In 2014, JVP established a cyber security incubator in Beersheba, home to 12 companies, in partnership with Ben-Gurion University of the Negev. The activities of the fund have led to the creation of an estimated 2,000 job opportunities and an additional 3,500 jobs in associated industries and played a key role in the establishment of Beersheba as a leading center of cybersecurity innovation, according to the report.
In recent years, JVP has been working with more than 20 regional councils and academic bodies in the Galilee to transform the northern periphery into a world-leading hub of food technology. The government has budgeted NIS 500 million to incentivize food companies to set up development centers in the Galilee.