Investment in Israeli Venture Capital Drops

June 1, 2010

“Foreign institutional investors—who, before the crisis, had been the lead source of capital invested in Israeli funds—have suffered serious losses due to the credit crunch,” said Koby Simana, CEO of IVCRC. “These losses have reduced capital available for investments.”

The report predicted that US $500 million would be raised in 2010 by Israeli venture capital funds for investment in Israeli start-ups and high-tech companies. Shapira said that the predicted venture capital investments were based on “data received from some of the leading venture capital funds,” but pointed out that “it’s our estimation and not what will be.”

The findings come on the backdrop of a general global decline. In the United States, venture capital funds suffered a 48% decrease in their fundraising figures in 2009, according to the report. The IVCRC’s numbers showed that the sectors that attracted the largest number of initial investments during 2009 were companies active in software, Internet development and life sciences, with each sector recording 17 deals or 22% of the total number of investments for that year.

Source: Excerpts of an article by Adam Gonn, The Media Line