Investment in Israeli high-tech companies rose in the third quarter of 2010, according to the Israel MoneyTree Report for the third quarter by PricewaterhouseCooper Israel. $253 million was invested in 68 start-ups, 23% more than the $203 million invested in 60 start-ups in the preceding, and 42% more than the $178 million invested in the corresponding quarter of 2009.
The figure that may best indicate the recovery of Israeli high tech is a 186% jump in seed-stage investment in the third quarter. On the other hand, 48% of Israeli venture capital funds made no investment at all during the third quarter.
pwc Israel partner, High-Tech Assurance Practice, Rubi Suliman said that this quarter's report showed mixed trends. "On the positive side, there was robust growth in investment in the number of companies raising capital and in the average investment per company.
"On the negative side, we reported in this quarter the highest number of funds in a decade making no investments at all. This trend, the concentration of investment is a smaller number of funds is not new, but it is growing stronger, which reflects funds difficulty in raising capital."
A breakdown of investment by sector found a 56% drop in investment in the life sciences in the third quarter compared with the preceding quarter and a 54% drop compared with the corresponding quarter. $30 million was invested in life sciences start-ups during the third quarter, down from $67 million in the preceding quarter and $65 million in the corresponding quarter.
Investment in software start-ups was 47% in the third quarter than in the second quarter, and 550% higher than in the corresponding quarter. Investment in software start-ups rose to $36 million in the third quarter from $24 million in the preceding quarter and $5 million in the corresponding quarter.
Internet start-ups are drawing investors, raising $48 million during the third quarter, up 74% from $27 million in the preceding quarter and 95% more than the $24 million in the corresponding quarter.
Published by Globes [online], Israel business news - www.globes-online.com - on November 2, 2010
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