Located at the eastern end of the Mediterranean Sea, Israel is a relatively small country, measuring 470 km north-to-south and 135 km east-to-west at its widest point. Despite its size, the country has a diverse topography- the hill regions of northern and central Israel, the Mediterranean coastal plain, the Great Rift Valley, and the Negev desert in the south. The US$ 402 billion economy is world-renowned for its advanced technologies, software, electronics, and other sophisticated equipment, which have stimulated industrial growth. Israel’s cutting-edge technology is the result of its emphasis on higher education and R&D. From startups that develop automated industrial drones to those that produce clean meat products, Israel is brimming with exciting startups that are worth exploring.
The analysis is based on data from Crunchbase, and overall, 43 startups have been analysed. Startups considered for this analysis are private entities that have raised more than US$ 100 million of capital to date.
The startups have been classified according to various industries based on data from Pitchbook, and the sector classification is based on the Global Industry Classification Standard (GICS). The sector classification is subjective and has been made considering the sector/industry the startups closely resemble.
Israeli startups are relatively young, with around 65% of them being 10yrs old or less. Only 5% of the startups are from the pre-2000s era. Founded in 1986, Priority Software is the oldest startup on this list. The startup claims to be a refreshing alternative to weighty and complex ERP systems and has 10k customers across 40 countries. With agility and scalability in mind, Priority offers a whole host of modules ranging from financials, CRM & sales to manufacturing, supply chain and warehouse management. The startup has raised US$ 125 million to date and is backed by TA Associates and Fortissimo Capital.
The information technology sector has attracted 59% of the funds or US$ 4.8 billion and is home to an almost equivalent amount of startups (60%). Network management software and business/productivity software are the two prominent industries that accounted for 34% and 25% of the funds flowing to this sector.
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Founded in 2015, AnyVision is the developer of a facial recognition technology designed to classify objects and identify targets. The startup’s solutions include an automated watchlist alerting system that identifies persons of interest and their contact history in real-time and historically, a touchless access control solution that uses facial recognition to open guarded points of entry for authorized people and a platform that leverages a number of state-of-the-art technologies including computer vision, machine learning, liveness detection and biometrics to help protect an organization’s physical access points. The startup has raised US$ 352 million from the likes of SoftBank Vision Fund, Lightspeed Venture Partners, Qualcomm Ventures and Robert Bosch Venture Capital. BioCatch has developed a behavioural biometric technology that recognizes a wide range of human and non-human cybersecurity threats. The startup’s services include account opening protection, account takeover protection, social engineering scam detection, among others. BioCatch has raised US$ 213.7 million in seven funding rounds and is backed by the likes of Barclays, HSBC, Citi and American Express Ventures.
The health care sector is ranked second in terms of funding and accounts for 18% of the funds or US$ 1.4 billion, and is home to 16% of the startups. Diagnostic equipment and monitoring equipment are the two prominent industries within this sector, attracting 63% and 10% of the funds flowing to this industry, respectively.
Insightec has developed MRI-guided focused ultrasound devices that provide non-invasive treatments for a variety of oncology and gynaecology indications. Founded in 1999, it’s the second oldest startup on this list and the highest funded startup, raising US$ 632.9 million in ten funding rounds. The startup is backed by NHS England, GE Healthcare and Koch Disruptive Technologies. Founded in 2016, Aidoc has developed an AI medical imaging platform that offers AI capabilities to its hospitals and health systems. The company recently raised US$ 66 million in Series C funding led by General Catalyst. In total, the startup has raised US$ 127.5 million in eight funding rounds.
The industrial sector accounts for 10% of the funds or US$ 838 million and is home to 9% of the startups. Printing services and energy storage have attracted 58% and 16% of the funds flowing to this sector, respectively. Landa Digital Printing has developed a unique digital technology called Nanography that bridges the profitability gap between offset and digital printing by enabling printers to produce short-to-medium run lengths cost-effectively. The startup has bagged US$ 485 million in three funding rounds. Founded in 2014, Airobotics is the maker of automated industrial drones that collect and analyse aerial data. The drones are fully automatic, have safety features like emergency landing, geofencing and ‘return home’; they are durable, corrosion-resistant and have 5 cm position accuracy. They have a wide range of applications such as inspection, stockpile management, surveying & mapping and security & emergency response. The startup has raised US$ 123.1 million from investors such as OurCrowd, BlueRun Ventures, and CRV.
The consumer sector consisting of consumer discretionary and consumer staples have together raised 7% of the funds or US$ 539.6 million and are home to an equivalent percentage of startups.
Aleph Farms produces clean meat products that provide authentic meat in a sustainable and cruelty-free way. The products are made using a 3D tissue formation technology, thus providing consumers with clean and healthy beef without the need for animal slaughter. The startup has raised US$ 236.4 million in five funding rounds from investors such as Cargill, VisVires New Protein and L Catterton.
Overall, Israeli startups have raised more than US$ 8 billion, with around 60% of them raising funds within one to five rounds. The median funding amount was US$ 140 million, and the average was around US$ 186.2 million. The median number of funding rounds was five, and the average was 5.2. Funding rounds- Series B, C, and D are among the top three accounting for 49% of the funds raised or US$ 3.89 billion. Given Israel’s technological supremacy, it’s not surprising to find that the information technology sector topped the ranks in terms of the amount of funding and the number of startups.
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