In 2005 Israeli VCs raised US$1.2bn (€1bn), a 40% increase on the previous year’s total and the highest since 2001.
Data published by the Israel Venture Capital (IVC) Research Center points to the closings of six funds in 2005, the biggest being Benchmark Israel II, which raised US$250m, closely following by Carmel’s US$200m vehicle. Israel Healthcare Ventures closed on US$140m, Sequoia Israel raised US$200m, Genesis managed to attract US$160m and Giza US$150m.
Four firms made first closings, including Vertex Israel III, on US$120m, and Medica-Poalim on US$80m. Concord, Israel Seed and Tamar Ventures all postponed their fundraising efforts on 2005.
Zeev Holtzman, chairman of IVC Research Center and Giza Venture Capital, said, “2005 capital raising set a four-year record, confirming the pullout from the year 2000 crises. Investments came mostly from foreign sources, while local investors were generally on the sidelines. Local inactivity raises concern that Israeli institutions will miss out on the new wave of promising investment opportunities.”
IVC estimates US$2.3bn of money is available for investment, with US$1.4m intended for first round investments in high tech companies. US$1bn is expected to be raised for Israel technology by VCs in 2006.