HomeAnalysisFollowing October 7th, the Israeli Tech Sector Remains Strong, According to Startup...

Following October 7th, the Israeli Tech Sector Remains Strong, According to Startup Nation Central

Avi-Hasson
Avi Hasson, CEO of Startup Nation Central (credit: Miri Davidovitz)

In the months following the events of October 7th, the Israeli tech sector has remained strong, according to new Finder spotlight research by Startup Nation Central, a non-profit that promotes the Israeli innovation ecosystem around the world. 

Despite some immediate challenges to the sector such as a reduction in workforce availability with some 15% of the workforce drafted into the war and short-term funding gaps where smaller startups with a short runway were most impacted, the Israeli tech ecosystem is showing characteristic resilience and continues to attract investors and venture capital funds activity.

Private investment rounds

There were 220 private investment rounds announced since October 7thwith an estimated $3.1 billion raised. The average investment amount was $19m. The most notable investment was the $265m round raised Next Insurance by Allianz X and Allstate. The leading sectors in the number of rounds were health tech (47), enterprise software solutions (42) and security technologies (39). The leading sectors in the amounts raised were security technology with close to $1.1 billion raised, and fintech and enterprise software solutions with almost $0.5 billion each.

M&As

The amount of M&As since October 7th is $3.7 billion. There were two very large M&A deals finalized with total acquisition amounts nearing $1 billion. Additionally, nine acquisition deals of over $100m were finalized, six of which were in the security technology sector, including Talon Cyber Security (acquired for $625m), Dig Security (acquired for $350m), Avalor (acquired for $350m) and Gem (acquired for $350m). Flow Security and Spera Security were acquired for $200m and $130m respectively. Health tech had the third largest deal with CartiHeal acquired for $330m and accounted for $425m of total M&A values. Enterprise Software Solutions M&As reached $240m.

New Funds

Since October 7th, over 20 new funds were established raising a total of $1.7 billion. Of these, 11 funds were established to address urgent startup funding needs due to the impact of the war and to show confidence in the Israeli tech ecosystem. These funds include Iron Nation; 1948 Ventures; OurCrowd – Israel Resilience Fund; SYN Ventures – Cybersecurity Seed; Trendlines – Startup Shield SPV; TechShield; Google Support Fund, and more.

VCWire

03/04/2024