CE Unterberg, Towbin is a New York and San Fransisco-based investment bank with a 30-year focus on technology and a long history of involvement in the Israeli high tech sector. Unterberg has been in this business so long, the bank took such companies as Intel and Compaq public, and its Israeli involvement dates to involvement in Scitex, Elron and EFI’s initial public offerings.
The bank has recently begun a different approach to its involvement in Israel’s tech sector, and has begun raising a $50-75 million venture capital fund to be known as the Tamar Technology Fund. Alexander Bernstein, a principal in the bank, told "Globes" the fund, about to close its first round of fundraising of $35 million, primarily from high net worth European, American and Israeli individuals, but some institutions as well, will be earmarked exclusively for technology in Israel.
Bernstein stated that the fund hopes to create strategic relationship opportunities for investee companies instead of just cash. He stressed that, although there is nothing wrong with pure Israeli capital, US capital can open otherwise unavailable doors to strategic relationships and distribution channels.
The fund will be run by Israeli Zohar Gilon, who has been involved privately in technology investment in Israel for a number of years. Bernstein noted that Gilon’s route has been unusual in that most people choose to invest other people’s money before they risk their own, but Gilon, who was involved in the early stages of Galileo and RADNet, recently sold to Newbridge and Siemens, is only now getting involved in a framework where he will manage investments of other people’s money.
Gilon’s track record also involves some of Israel’s most talked about mergers and acquisitions of recent years, such as the Lannet-Madge and Armon-Bay Networks deals.
The bank is currently setting up an office in Israel and has already begun investing. The bank itself has invested in RADGuard, and the fund will invest in RADVision.
Bernstein noted that Israeli capital is not necessarily associated with a specific exit strategy or due diligence. The bank’s involvement in the fund means the bank itself will be able to take the investee companies public, but Bernstein stressed that the fund will not require companies to go public through Unterberg, but will opt for the most appropriate bank to underwrite public offerings.
Published by Israel's Business Arena June 9, 1998