IVC Research Center has released the findings of their quarterly survey, summarizing Israeli capital raising in Q4 2008. Israeli companies raised $394 million in the last quarter, a decline of 22% compared to the equivalent period in 2007. That said, 2008 was a record year for Israeli high tech capital raising, reaching a peak of $2.08 billion, an eight year record, second only to the peak of the first dot com bubble in 2000 which then reached $3.09 Billion.
Key messages from the report show good news and bad news:
- 109 Israeli companies have raised $394 million during Q4 of 2008
- The international funds are responsible for most of the growth. In 2005 for every Israeli Dollar international funds raised $1.04, in 2008 however, for each Israeli Dollar spent International funds invested $1.66, which is also a 7 cent increase compared to 2007.
- Israeli funds invested $780 million in Israeli high tech companies during 2008, only 38% of the total sum, and less than half of the $2 Billion the VC industry is ‘sitting on’
- The average financing round was $3.61 million, compared to $4.37 million in the fourth quarter of 2007 and $4.83 million in the previous quarter.
- Seventy-six companies attracted more than $1 million each. Of these, 18 companies raised $5 million to $10 million each, nine companies raised $10 million to $20 million, and one company raised over $20 million.
- Seed investments were down 3% compared to last year, attracting only $104 million, invested in 70 companies.
To end on a positive note, Zeev Holtzman, Chairman of IVC Research Center and Giza Venture Capital, said:
2009 will be a tough year for all companies, yet Israeli high-tech industry will continue to be a highly abundant source of technology innovation.
The full report can be found at IVC Online.