Privately held Israeli technology companies raised $9.58 billion in 2024, up 38% from 2023, IVC-LeumiTech reports. The report is generally upbeat although fundraising was down 4% in the fourth quarter of 2024 from the previous quarter even though the amount raised was 60% higher than the corresponding quarter of 2023, when the war broke out.
However, it is worth noting that IVC-LeumiTech’s numbers include former OpenAI CEO Ilya Sutskever’s company Safe SuperIntelligence (SSI), an American company that opened an Israeli subsidiary, but as far as we know does not have any Israeli employees yet. Without the $1 billion raised by SSI, Israeli startups raised $8.58 billion, a number that is still very high by historical standards except for the peak years of 2020-2022.
Israeli investment reaches its lowest levels
But while Israeli technology investment numbers have stabilized nearly 15 months after the outbreak of war, the 2024 IVC-LeumiTech report reveals the worrying trend that the number of Israeli investors in local technology companies has reached its lowest level in recent years. . In Q4 2024, only 159 Israeli venture capital funds and corporate entities were partners in investments in Israeli startups and growth companies. According to the report, there was an increase in the number of Israeli investors at the beginning of 2024 compared to the quarter in which the war broke out, and the number of investors reached 229, but it gradually decreased by the end of the year, and now stands at an even lower number than it was in the months following October 7.
In boom times in early 2022, the number of Israeli funds and institutional investors reached 548, but even in periods considered less bubble-like and quieter, such as the fourth quarter of 2018 and 2019, there were 240 and 280 investors in technology companies. Overall, there was a slight recovery in the number of investors in Israeli technology, due to the stability of the number of foreign investors and their numbers increased from 257 in the third quarter of 2024 to 266 in the fourth quarter. These are levels that were last recorded only in the second half of 2018.
Another decline was also recorded in the number of new investors – that is, investors for whom 2024 marks their first year of investing in Israeli technology. After registering 726 such investors in 2023, only 422 new investors appeared in the analysis of this year’s investment rounds. However, the report’s authors admit that there is no certainty that this is the final figure, and it is estimated that only later next year will additional unreported fundraising rounds be counted, so that it will be possible to reach a new number of investors, ranging from From 700 to 750, compared to about 800 in all of 2023.
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IVC-LeumiTech reports the return of a higher number of mega-funding rounds of $100 million or more, representing 48% of the total funds raised in 2024 – the highest number since 2021, which saw a higher number of such rounds than before. Unicorn companies. The amount of money raised by cybersecurity companies reached 38% of the total funds raised – a record high – with Wiz raising $1 billion and Cyera raising $300 million.
Published by Globes, Israel Business News – en.globes.co.il – on December 30, 2024
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