Growing confidence in Israel's high tech sector

Jerusalem Boardroom #223, Prior issues: http://bit.ly/2st1Nn3, October 27, 2017

1. Israeli start-ups raised a record $3.8BN in the first three quarters of 2017, $1.44BN of which was raised during the third quarter – 54% higher than the third quarter of 2016. The third quarter of 2017 was boosted by the $250MN raised by Israel's Via Transportation (carpooling applications), mostly from Germany's Daimler (Globes Business Daily, October 24, 2017). Daimler also led a $60MN round of private placement by Israel's StoreDot, a developer of a sophisticated, swift technology (Flash Battery) to charge car batteries (Globes, Sept. 15). Israel's BlueVine – online business lending operations – raised $130MN from the Silicon Valley Bank, Sun Trust Bank, Menlo Ventures, etc. (Globes, Oct. 24).


2. Israel's Beit Shemesh Engine Holdings – one of the few companies in the world able to produce rotating critical parts for jet engines - has expanded an agreement to supply parts to Prat & Whitney to a total of $640MN (Reuters, September 14).

3. The US Army approved the installation of Israel's Trophy Active-Protection System (APS) - developed jointly by Israel Aircraft Industries and RAFAEL - on a number of its MIA2 Abrams tanks, designed to detect and neutralize incoming projectiles in Syria, Iraq and Afghanistan. The Trophy ($350K per tank) is the world's only fully operational and combat-tested APS, possessing four radar antennae and fire-control radars. It tracks incoming threats such as anti-tank guided missiles and rocket-propelled grenades. Once detecting a projectile, Trophy fires a shotgun-type blast to neutralize the threat 

4. Israel's Elbit concluded a $240MN transaction with an African nation, consisting of: the upgrading of helicopters and the acquisition of laser-driven missile defense systems for the helicopters, mini-UAVs, telecommunication systems and anti-shoulder-propelled missiles systems 

5. China's Alibaba Group Holding, a top e-commerce firm, is launching a $15BN drive to build eight research hubs – in China, Israel, the US, Russia and Singapore - in order to leverage e-commerce, logistics and cloud technologies, which are developed globally (Reuters, October 11, 2017). China's ShengJing Group, the largest private equity fund in the world, has established an accelerator for Israeli companies, seeking interaction with the Chinese market. ShengJing invested $100MN in a series of Israeli startups (Globes, Oct. 2).

6. Intel is establishing a new Artificial Intelligence center in Israel, hiring dozens of Israeli specialists (Globes, Oct. 16). The mega-billion dollar Intel and Nvidia, two US global leaders in the development of artificial intelligence and autonomous cars, expand their investments in Israel, attempting to leverage Israel's brainpower. Nvidia is establishing, in Israel, a research & development center, which will employ hundreds of people. General Motors is preoccupied, in its Israel research & development center, with the development of human-robot-interaction (Globes, Oct. 3). Intel Capital invested in two Israeli cyber security startups (Globes, Oct. 24). Intel invested in over 60 Israeli startups, in addition to its four research & development centers and two manufacturing installations, which export $4BN annually.   

7. The $52BN British private equity fund, CVC, acquired the women's health division of Israel's Teva Pharmaceuticals (outside the US) for $703MN, negotiating the acquisition of 80% of Israel's largest chain of 180 drugstores (Globes, September 25).

8. Germany's $130BN SAP acquired Israel's Gigya for $350MN (Globes, Sept. 25).

9. Medtronic, the medical equipment giant manufacturer, is opening two new development centers in Israel (Jerusalem and Yokne'am), employing 100 people, joining its 750 Israeli personnel out of 85,000 employed globally (Sept. 12).