Tech Companies in Israel Raise Funds of $5.6 Billion in the First Quarter
In recent news, the tech companies in the State of Israel have set an extraordinary funding record by raising more than the figure for the previous year. The year 2021 proved to be a good one for the country, given that it recorded more than $25 billion in funding. In line with a battering on Wall Street in the last couple of months, companies from across the Jewish state further revealed that they have managed to come up with around $5.6 billion. This figure only pertains to the first three months of the current year, as per a report published by the IVC Research Center, as well as LeumiTech. The latter is the banking arm of the Leumi Group that caters to the needs of high-tech corporations.
The total sum of $5.58 billion was gradually raised through no less than 212 deals in Q1 of 2022. This is on par with the funds raised in the same duration of the previous year, which amounted to $5.4 billion. However, the report pointed out that this figure is less than that recorded in the last quarter of 2021, when Israeli companies experienced a boom and nabbed $8.1 billion overall in funding. The 212 rounds of overall fundraising in Q1 of 2022 pertained to 14 mega deals, which reeled in more than $100 million each. This made up around 44% of the complete amount raised.
It is not surprising that the funding has now shrunk significantly in the last quarter. Israeli tech shares have not been performing well on Wall Street and as a result, IPOs have fallen down to just seven. These were a part of around 39 tech exits, which are defined as IPOs of shares or agreements for mergers and acquisitions. The total damage caused by these was around $8.96 billion, which largely comprised of the intended acquisition of the Tower Semiconductor in Israel by Intel. The deal was set for a figure of $5.4 billion. The company is also gearing up to purchase Granulate, a computing tech startup in the Jewish state. An announcement was made by Intel last month, which further revealed that the funding for this acquisition would be somewhere around $650 million.
Another notable acquisition that took place was that of Siemplify, officially known as Cyarx Technologies. Google bought the Israeli threat detection company for $500 million. The CEO of LeumiTech, Timor Arbel-Sadras, explained that after having a phenomenal year, the high-tech industry in the Jewish state is seemingly having issues this year. He pointed out that the year has begun with the sector showing some restraint. Moreover, according to him, it seems as if investors have slowed down with their investments and are waiting to see a correction in valuation, specifically in the private sector.
In the last couple of quarters, cybersecurity firms together generated the largest amount of funding, which was around $1.8 billion. This figure was recorded in the first quarter of 2022 alone. The pace was followed quickly by fintech startups in the country with a sum of $985 million. IoT, Internet of Things firms, followed suit with $464 million and foodtech outfits brought up the rear with $341 million in total investments. The figure for the latter also included $135 million for Redefine Meat, a plant-based meat startup.
