Czech-European investment bank Benson Oak is setting up a new venture capital fund specifically for investments in Israel. The fund has already raised $25 million and Benson Oak plans to raise $100 million for it during the year. Robert Cohen, a founding partner in the fund, told "Globes" that 60% of the amount had already been raised.
The fund will focus on investing in startups from the seed stage and will continue investing in later rounds. Cohen promises that he and his partners in the fund will provide business development assistance to the companies in which the company invests. The fund's investors are private investors and family offices from Europe and the US who have invested in Benson Oak's funds since it began investment activity in 2003.
Since 2003, the investment arm of Benson Oak has raised three small venture capital funds that did not exceed $25 million, all three managed by Cohen. The current fund has also raised only $25 million to date, but its target is substantially higher than the previous funds.
Up until now, the fund has invested money of private investors and family offices on the basis of personal acquaintance and a flexible model similar to a family office. New investors are expected to join the current fund, Cohen says, which is likely to be the "most structured fund so far." At the same time, he says, flexibility will be preserved because many of the existing investors have expressed interested in also making private follow-on investments together with the fund.
"Our model was and will continue to be investing in companies from the seed stage. We always want to lead investments in the early rounds as long as we can and continue investing until the exit," Cohen says. "Many Israeli companies have grown relatively quickly and were sold at a relatively early stage, and I think that this is starting to change. This is what's happening with companies like Wix, and it's what I want to do with Slidely, in which we invested with the previous fund."
Although the new fund is larger than the previous ones, it is only $25 million so far, and even if raises the additional amount, it will not be especially large. Nevertheless, the Czech fund has chosen to focus on a relatively competitive market of investment in Israeli technology companies. Cohen says that he chose to focus on Israel "because of Zionism."
"Globes": Nevertheless, what distinguishes you and how do you plan to attain an advantage as a not-very-large investor in Israel?
Cohen: "We're very focused. In contrast to many investors, we concentrate on business to consumer (B2C) and business to small business (B2SMB) companies. In my opinion, blockchain technology is an important factor in platforms of this type, that have a community of customers around them. I understand B2C solutions very well, and I know how to sell them and how to make money out of them."
Many investors are nervous of blockchain and they may be right
"First of all, I think that Web 3.0 and blockchain within it is going to change the world, but we don't yet know how. As far as I'm concerned, investing in this now is investing in the future."
Benson Oak was founded in 1989 in Czechoslovakia and has raised a total of $5 billion since then. The investment bank has founded three investment funds since 2001, all managed by Robert Cohen.
Published by Globes [online], Israel business news - www.globes-online.com - on July 8, 2018
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