The Israeli startup and innovation scene has had much to offer to corporate investors from around the world. Since 2011, GCV Analytics has tracked 222 deals with corporate involvement in emerging enterprises based in Israel.
There has been a clear upward trend of corporate-backed funding rounds raised by promising Israeli companies, which evidences the robustness of the country’s innovation scene. The majority of emerging Israeli enterprises that CVC investors from around the world have found attractive came from the IT, health and industrial sectors, as shown on the historical bar chart.
What is particularly notable is that in most of those corporate-backed rounds, the corporate venturers (investing either with a specialised venturing unit or from the corporate balance sheet) are foreign-based. This clearly points to the fact that Israel possesses top-notch technological talent, which catches the attention of many around the globe.
Companies that have received corporate funds in the largest rounds were in enterprises from the IT, transport and health sectors. Also, one must not forget that the largest acquisition of an Israeli startup took place just last year when Intel agreed to purchase Mobileye, the developer of vision-based driver assistance systems, for the record-breaking and whooping sum of $15.3bn.
Top corporate-backed deals in Israel-based companies (2011-17)
The majority of corporate venturers coming to Israel have been big names of multinational corporations from a variety of sectors, e.g.: US-based semiconductors and chip manufacturers Qualcomm and Intel, South Korea-based electronics manufacturer Samsung, US-based pharmaceutical company Johnson & Johnson and Japan-based conglomerate Mitsui, to name just a few of the top ones. The following chart represents a ranking of top corporate VCs by number of deals in Israeli enterprises and by total capital invested in rounds for the period 2011-2017.
In a country with a vibrant economy like Israel, there has been no dearth of local corporate investors, investing domestically and internationally. However, the total amount of their publicly disclosed and reported deals has been somewhat more modest. GCV Analytics has tracked only 42 such deals involving Israeli-corporates over the past years. These deals were commitments primarily in Israel and US-based companies, as shown on the map.
The following chart represents a ranking of Israel-based corporate venturers that we have been able to track based on publicly disclosed deals. Among them, we find names like BRM Group, Teva Pharmaceuticals, Elron Electronic Industries, Elbit Imaging, among others.
The Israeli corporates have also demonstrated a clear preference for health and life science enterprises as well as promising IT and transport startups, among commitments in other sectors.
In term of stage preference, according to our data, Israeli corporate venturers tend to opt for mid and later-stage rounds (series A and beyond). However, this must be taken with a grain of salt, as there are a lot of rounds that Israeli CVC do not disclose, much like their peers elsewhere.
The following table summarises the largest deals in which Israel-based CVC have taken part. Unsurprising, they have been mostly in health/life sciences, transport and IT companies as well.
