Israeli crypto-wallet co KZen Networks raises $4m

KZEN founders Photo: PR

The beta trial of the Israeli company's app will begin in the coming weeks,

Israeli crypto-wallet startup KZen Networks has completed a $4 million seed financing round. Czech investment bank Benson Oak Ventures led the round with participation from the Samsung Next and Elron Ventures funds, plus investors active in blockchain and cryptocurrencies, such as BlockNation, Collider VC, FJLabs, and a number of other investors. KZen was previously funded by its founders.

KZen cofounder and CEO Ouriel Ohayon told "Globes," "We're building a new generation of safe crypto-wallets. It is believed that there are currently 30-50 million active wallets. Many people are earning money, and companies are also earning money. Our e-wallet doesn't depend on a company, and it significantly upgrades security and the user experience." Ohayon said that current digital wallet software did not prevent loss of money and fraud; more than $1 billion in cryptocurrencies was stolen in 2018. KZen's technology offers a new approach to one of the dubious elements in holding cryptocurrencies: management of the private key. Instead of methods such as writing it on a scrap of paper and keeping it in a safe, KZen has developed software that eliminates the need for a private key by using cryptographic elements of decentralization without there being a single place in which the money can be accessed.

Ohayon says that a beta trial of the app will begin in the coming weeks, and that the app is scheduled to reach iPhone and Android app stores within a few months. He adds that the business model is based on downloading the app for free, with revenue coming from sales of premium features.

Benson Oak founder and managing partner Robert Cohen played an important role in developing AVG as one of the world's leading consumer security brands.

Benson Oak, founded in 1989, has raised over $5 billion to date. The bank has three investment funds, including a special $100 million fund for Israel focusing on blockchain and new startups.

Cohen said, "Security for digital currencies wallets currently constitutes a significant problem. The existing solutions have forced consumers to choose between user experience and the best solutions of their type. I have seen at first hand how an excellent team with a wonderful vision for a product is capable of taking a company from the startup stage and turning it into a global leader. We made this investment because we believe that KZen's team encompasses the array of talents needed to deal with the huge opportunity in the wallet market, which combines a great user experience with sophisticated security." Cohen will join KZen's board of directors.

KZen was founded by Ohayan, engineering manager Gary Benattar, Omer Shlomovits, and security research manager Tal Be'ery. Ohayon has founded startups and venture capital funds in France and Israel, including TechCrunch France (sold to AOL); managed ICQ's activity in AOL; and invested in companies such as Outbrain and French company BlaBlaCar.

Published by Globes [online], Israel business news - en.globes.co.il - on October 11, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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KZEN founders Photo: PR
KZEN founders Photo: PR
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