A study conducted by investment funds The Time and First Time indicates a trend among Israeli entrepreneurs away from exits and towards long-term investments.
The study, which encompasses both quantity and quality, integrates findings from studies published by leading entities and academic articles. It reports, "The statements by entrepreneurs to investors are not lip service. Their focus is being gradually diverted from an exclusive effort to solve deep technologies to building aggressive global enterprises aimed at achieving large profits." The study findings were compared with previous research conducted by the funds in 2014.
According to the study authors, actual figures show that there are currently 24 Israeli Internet companies with revenue in excess of $100 million, compared with only 15 in 2014. At the same time, the Israeli Internet industry is creating unicorns - companies with market caps of over $1 billion, at a rising pace. There are now 12 such companies with an aggregate market cap of over $47 billion. Israel has actually become the country with the highest per capita number of unicorns.
The study states that Israel is become not only a nation of startups and innovation, but also a nation of business achievement and mature companies. Among other things, this trend can be attributed to the global "winner-take-all" trend - the establishment of huge Internet companies, headed by the big six: Facebook, Amazon, Apple, Microsoft, Google, and Alibaba - which the study calls the Sixth Continent. These companies have increasingly dominated the sectors in which they operate.
Ilan Shiloah, who heads The Time and First Time funds, says that the study provides a further indication of how the industry has matured. According to the study, more than 23 financing rounds of over $50 million each were carried out starting in 2016, more than four times the number in the corresponding period in the previous study in 2014.
Shiloah claims that there is a strong trend in Israel towards founding special venture capital funds for investment in advanced growth stages, which also encourages entrepreneurs to take home some money in a partial sale of their shares in order to help them extend their march forward.
Published by Globes [online], Israel Business News - www.globes-online.com - on October 22, 2017
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