Startup Nation keeps on hitting new highs, bringing in a record $17.78 billion in new investment for its high tech firms from 575 different deals over the first three quarters of 2021. This according to a new report released by IVC Research and the Meitar law firm.
The numbers for 2021 are understandably much higher than for 2020. This is because the Covid crisis caused a worldwide economic crisis. But now new records are being set, perhaps, in part, due to the optimism that is coming with the, hopefully, end of the Coronavirus crisis.
IVC is Israel’s largest research center of high-tech and venture capital. It has been evaluating these areas for over 23 years, analyzing trends and developments in the industry.
IVC explains that its Quarterly High-Tech Report is the first report of its kind in Israel. The report evaluates fundraising, mergers and acquisitions, and the capital markets to provide a comprehensive analysis of the Israeli high-tech activity industry. The report contains comparative data from previous years, leading trends, insights into future trends, and fund raising projected data.
The report summarizes the Israeli high-tech companies or companies associated with Israel in the years 2015 – Q1–Q3/2021. The number of deals and their volume may change throughout the reported year due to ongoing online IVC database data updates.
Israeli firms brought in $5.8 billion in Q3 2021 alone, from 177 deals.
The number of Early rounds has already reached 85% of the annual 2020 figure. $2.5 billion was raised in 293 deals – an increase of 35% from the annual 2020 amount. Median amounts reached $4 million – evidence of growing capital intake in early rounds.
Two examples of huge raisesfor Israeli startups came in September. Totango, an Israeli startup that leverages data to orchestrate and transform revenue experiences, raised $100 million in Series D funding. Israeli Startup StreamElements raised $100 million in a financing round. StreamElements offers interactive tools to help companies manage communities and create revenue for streaming content creators.
Israeli high-tech exits skyrocket to $18.92 billion – up 92% from the annual 2020 results, with 180 transactions. The majority of capital volume derived from IPOs – 52% of total amount, exceeding M&A proceeds.
The IPO figure is probably eschewed by one really big exit made by SentinelOne. SentinelOne, an Israeli cybersecurity firm, made a killing with its initial public offering on the NYSE on June 30, coming away with a massive $8.9 Billion valuation.
IPOs in Q1–Q3/2021 peak with 65 deals, leading exits to their record numbers.
Capital volume of M&As ($9.14b) surpassed the annual figure from 2020 ($8.2b). Five M&A transactions of over $500 million each achieved a total volume of $2.76 billion.
IVC says that the historic amount raised in this period was up 71% from the annual 2020 amount, mostly due to the exceptional number of deals over $100 million that accounted for a 51% share of the total sum for Q1–Q3/2021. There were 20 such deals in total.
Marianna Shapira, IVC Senior Analyst, noted, “We observed the current upward trend since March 2021, leading monthly averages in Q1–Q3/2021 to $1.98 billion, compared to a $864 million monthly average in 2020, as more mature Israeli companies have established trusted connections with their foreign investors, proving themselves as stable targets for growth investments. We believe that at least for the near term, this trend will continue.”