150 Chinese investors seek to back Israeli startups

Chinese high-tech investors
Chinese high-tech investors

The Chinese visitors met with representatives of 50 high-tech firms at an investment summit in Haifa.

Chinese organizations have been heavily investing in the Israeli high-tech sector over the past few years. On Monday, 150 investors arrived in the country to participate in the China-Israel Hi-Tech Investment Summit held at the Dan Carmel hotel in Haifa.

"It is currently difficult for Israeli companies to break in to the Chinese market without a strategic, local partner," said Dafna Linenberg, the founder of consulting firm YHT, which hosted the conference in close cooperation with the Haifa municipality.

"The Chinese market is complicated, complex, and layered. It is very difficult to operate there. If you are a small Israeli company, you do not have the resources to operate there without a local partner - both for marketing and regulatory purposes. Few companies work in China without a local partner."

The summit, said Linenberg, introduced venture capital and private equity fund managers, CEOs, and owners of Chinese firms to some 50 Israeli high-tech companies focusing on cleantech, medical devices, telecommunications, and media.

"There are many Israeli companies that are willing to set up a 'joint venture' with a Chinese firm instead of raising capital the usual way," she said, "Those funds are designated for Chinese operations, not for entering the US market or paying dividends. In the past, that condition was unacceptable for Israeli companies."

What happened in recent years that made Chinese investors interested in Israeli startups?

Linenberg: "The most significant change is the willingness of the Israeli market. The Chinese were always interested. Over the years, I have accompanied fund managers and CEOs of companies traded on the Shanghai Stock Exchange but the Israelis were not receptive.

"The Israelis always preferred a US, European, or Japanese investor over a Chinese investor. China didn't make the list. But the approach has changed, and Israelis have realized that China needs to be part of their market strategy."

Linenberg also emphasized the change occurring within China. "In the past few years, the word 'innovation' has been pushed by the Chinese government. There is growing encouragement from the Chinese government on the technology front, seeking to adopt innovation and be innovative. China is moving from 'Made in China' to 'Innovate in China'. They no longer want to be the world's factory, they want to own the technologies; the moment the government encourages innovation and not exports, the market responds appropriately."

Published by Globes [online], Israel business news - www.globes-online.com - on November 2, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

Chinese high-tech investors
Chinese high-tech investors
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018