Will 2024 turn out to be better for Israel’s technology sector than last year? Alongside extensive layoffs, there is also talk of recovery. Indicative of that is that investment platform OurCrowd has announced that it is expanding its investment commitments in its Israel Resilience Fund from eight startups to thirty-four.
The ventures in question are from a broad range of sectors, among them agritech, fintech, health services, enterprise hardware and software, and artificial intelligence. What they have in common is that they have been affected one way or another by the war. Some have had to evacuate their offices, some have employees doing reserve duty with the IDF, some have seen their funding affected, and some are assisting in the war effort.
In order to obtain funding, a company has to demonstrate that it received previous funding of at least $1 million; that its product meets a market need; and that after the funding it will have enough cash for at least nine months. The Israel Resilience Fund will provide up to 50% of an investment round in companies that meet these criteria.
Portfolio companies will also receive business support from PwC Israel. Among other things, this will consist of assistance in business development and in raising funds in Israel and overseas, connections with a pool of finance executives who have committed themselves to helping the companies, dedicated mentoring services, and more.
“OurCrowd is waiving all management fees and carried interest, in a move which will further strengthen investors’ financial return,” says OurCrowd founder and CEO Jon Medved. “The fund meets a critical need of the market, in that it creates an incentive to invest in the runway extension that companies need. It turns out that, on average, investments in the fund leveraged eight dollars for every dollar invested, so that, altogether, more than $100 million have been invested in the past few weeks.
“This success inspired our investors to keep moving forward, and we hope that in the coming weeks we will be able to widen the circle of activity. What chiefly concerns startups at present is the need to find a lead investor who is ready to stand up and say ‘I’m investing in this company now, and not waiting for the war to end and for the situation to become clear.’ The high-tech industry needs investors with courage.”
Medved founded the OurCrowd platform in 2013 to make venture capital investment accessible to the general public. The platform’s investment commitments amount to some $2.3 billion, and it has invested in 440 companies and 56 investment funds, and posted 63 exits, besides several flotations.
Published by Globes, Israel business news – en.globes.co.il – on March 24, 2024.
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