Celsius chief executive Alex Mashinsky at Token Fest (company Facebook pic)
The year 2022 was not a very good one for Israel Startup Nation. In addition to numerous firms laying off many employees a number of Israeli companies – from new ones to well established firms – shutdown entirely. Here is the Jewish Business News list of the 5 biggest Israel business busts of 2022.
Cineworld
Cineworld, a worldwide chain of movie theaters owned by Israeli brothers Moshe “Mooky” and Israel Greidinger, went into bankruptcy in August. The once superpower of the entertainment industry was devastated by the worldwide Covid pandemic and the shutdowns that it caused.
For two years movie theaters suffered some of the worst of the crisis as they could not offer a service considered to be vital. And even when restrictions were lessened and theaters could open, countless people avoided such venues for fear of infection.
Will you offer us a hand? Every gift, regardless of size, fuels our future.
Your critical contribution enables us to maintain our independence from shareholders or wealthy owners, allowing us to keep up reporting without bias. It means we can continue to make Jewish Business News available to everyone.
You can support us for as little as $1 via PayPal at [email protected].
Thank you.
And now, with major movies available online within months of their theatrical releases, moviegoers are shunning theaters like Cineworld and waiting to see the movies in the comfort of their own homes.
Cineworld, and others, just can’t compete with a whole family – or even a 20 people party – getting to watch movies at home with modern home theater tech on big screen HDTVs for less than the price of two movie tickets.
And recent years hit Cineworld especially hard, maybe worse than any other movie theater business. While it was booming at the end of 2019, the company now has $9 billion in debt. And its stocks traded on the London FTSE exchange have plummeted more than 80%
Celsius Network
In July, Celsius Network, an Israeli fintech startup and unicorn working in the crypto industry filed for chapter 11 bankruptcy. The decision came just days after news broke that the company was being sued for millions. And this is a unicorn – a startup valued at more than $1 billion.
In a blog post, Celsius said, “Today’s filing follows the difficult but necessary decision by Celsius last month to pause withdrawals, Swap, and transfers on its platform to stabilize its business and protect its customers. Without a pause, the acceleration of withdrawals would have allowed certain customers — those who were first to act — to be paid in full while leaving others behind to wait for Celsius to harvest value from illiquid or longer-term asset deployment activities before they receive a recovery.”
Reali Real Estate
Reali is a real estate and fintech company that offers services for home buying and selling. Or rather, it was. In August the company revealed that it was shutting down its operations.
Reali explained that it failed due to the “challenging real estate and financial market conditions and unfavorable capital-raising environment.” As a result, the company determined that its best course of action was to close. Active real estate transactions will continue to be supported through the end of the year by a small team of employees. Reali added that it is in ongoing conversations with companies that have expressed interest in acquiring specific parts of its business, including mortgage origination, title & escrow, and power buying.
Founded in 2015 by Ami Avrahami and Amit Heller, Reali is a real estate and fintech company creating a one-stop-shop to make homeownership “simple, affordable, and stress-free every step of the way.” Reali states that it leverages “first-in-kind” technology to serve home buyers and sellers in a single, integrated platform.
Soluto
In July, America’s Asurion announced it was closing its Israeli subsidiary Soluto, costing 120 people their jobs in the country. Soluto provides insurance for smartphones, tablets, consumer electronics, appliances, satellite receivers and jewelry. The company also provides repair and maintenance services. Saluto was founded in 2008 and offers similar solutions. It was acquired by Asurion in 2013.
Avo Grocery Delivery Startup
Avo, an Israeli startup that offered a service for delivering groceries, is in danger of closing down its business entirely and began the process of closing in May. The company was forced to shut down all of its Israel operations, in a move that came as a surprise to its local workforce.
Founded in 2018 by CEO Dekel Valtzer , Idan Hershko, Nir Smadar and Neri Bluman, Avo says that it is defining the future of e-commerce through its “custom, white-labeled online stores for residential and commercial companies and property owners.” The company boasts that residents and employees order same-day delivery of anything from fresh groceries & personal care items to electronics and more.
