Israeli health-tech and life sciences venture capital firm aMoon, founded by Marius Nacht and managed by Dr. Yair Schindel has closed a $660 million investment fund, the company has confirmed.
This amount makes it the biggest venture capital fund operating in Israel today as well as the largest life sciences and healthcare fund ever set up in Israel and one of the largest outside of the US.
This is aMoon's second fund. Nacht was the only investor in the first $200 million fund and after proving it could earn successful returns, the second fund has attracted investors from Israel and abroad, with Credit Suisse responsible for raising about $250 million of the amount.
The fund already began operating before the official closing, and has already invested in four companies in Israel, as well as a fifth company founded by an Israeli entrepreneur in Silicon Valley. The four Israeli companies invested in are cartilage treatment company CartiHeal, drug development company Biolojic Design, targeted therapy company Ayala Pharmaceutical and deep learning software company Zebra Medical Vision.
The first aMoon fund invested in Apos Therapy, BiondVax, Mapi Pharma, DayTwo, Medial EarlySign, Pharma Two B, Regenera, and others. There has not yet been a significant exit from aMoon I's portfolio, but several of the companies have had successful follow-up financing rounds.
The vision of aMoon II is investments at relatively advanced stages, after Nacht and Schindel realized that there was often a lack of investments at this stage, with pharma companies being stalled in financing their important clinical trial, while medical device companies were halted at the commercialization stage. These two stages require substantial sums. If financing for them is inadequate, the result is liable to be decisions that will cause failure of the trial or launch. A venture capital fund of aMoon II's size can enable Israeli companies to take part in the game with amounts it was formerly difficult for them to raise.
Market sources said that the fund preferred to lead the investment rounds in its portfolio companies as a sole investor or dominant controlling shareholder. This strategy has been unpopular in the local market up until now. It will be interesting to see how it will affect the market's dynamics when companies must sometimes choose between a large investment from aMoon and a consortium of smaller funds.
Simultaneously with aMoon II, $60 million more has already been raised for another fund named aMoon Velocity, which will invest in breakthrough technologies at the early stages. The plan is to raise $120 million from the same investors that invested in aMoon II, but each investor can choose whether to focus exclusively on later-stage investments or to divide his or her investment between the two funds.
Schindel says, "We plan to utilize the Israeli ecosystem, which contains breakthrough science and technological innovation that changes the picture, in order to achieve healing faster and redesign the health market. The financing round is a vote of confidence in the Israeli medical ecosystem." Schindel added that Israel's advantages in digital health, including pioneer medical information databases dating back 20 years, and the government venture designed to support digital health in the country with a NIS 1 billion investment, has already begun to affect the ties between hospitals and Israeli digital health companies.
Nacht says, "The growing connection between technology and health is generating a wave of innovation that can redefine medical treatment beyond our imagination. This is a unique opportunity for both influencing the world and for investment."
Credit Suisse's manager for assets in Switzerland and EMEA Michel Dagan said, "We believe that our cooperation with aMoon presents an attractive platform for investors and provides the necessary financing for developing businesses that will benefit mankind."
Another investor in the fund is Morris Kahn. In addition to his large investment in the new aMoon fund, Kahn is also an anchor investor in the Aurum life sciences fund, and supported the establishment of a big data-based health center in cooperation with Maccabi Health Services.
Kahn said today, "aMoon will play a very important role in the Israeli contribution to global health. I am fortunate to be able to participate in a venture with such vision managed by Marius Nacht and Dr. Yair Schindel."
As reported by "Globes," aMoon began raising its second fund in early 2018, which means that it has proceeded fairly quickly. Schindel said at the time, "Since the money invested in the first fund was entirely from Marius, it invested in two types of companies - either very early stage, even building companies from zero, as in the case of DayTwo , or fairly late stage, such as BiondVax, CartiHeal or Mapi Pharma, companies that within two to three years we'll be able to know whether they will be successful or not.
"When investors started to approach us and asked to invest with us, the need arose to separate the offers, in order to suit the various tastes and needs of the various kinds of investors. So aMoon 2 was founded to invest in late-stage companies, while a smaller fund was set up to invest in early-stage projects."
aMoon I was founded in late 2016. Nacht, a cofounder of leading information security Check Point (Nasdaq: CHKP), recently sold his shares in the company, among other things in order to found the health fund. Schindel, who headed the Digital Israel government venture, was recruited as the fund's managing partner.
Full disclosure: Marius Nacht is the former partner of Anat Agmon, one of the controlling owners of "Globes."
Published by Globes, Israel business news - en.globes.co.il - on March 6, 2019
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