* High-tech firms raise $1.92 bln in 2012 vs $2.14 bln in
* Israeli VC fund investments down 19 pct to $516 mln
(Adds more comments from IVC CEO)
By Tova Cohen
TEL AVIV, Jan 14 Israeli private high-tech firms
are expected to raise about the same amount of capital in 2013
as in 2012 as foreign and corporate investors increase their
activity, offsetting a decline in Israeli venture capital
The Israel Venture Capital (IVC) Research Center said on
Monday high-tech companies raised $1.92 billion in 2012 from
local and foreign investors, down 10 percent from an 11-year
high of $2.14 billion in 2011. The life sciences sector
attracted the largest share of investments at $497 million.
Firms raised $494 million in the fourth quarter, up 5
percent from the third quarter but down 14 percent from the
year-ago quarter, IVC, in cooperation with the Israeli office of
consultancy KPMG, said in a report.
Israeli VC fund investments totalled $516 million in 2012,
19 percent below the $638 million invested in 2011.
"While investment by Israeli VC funds is shrinking, foreign
VCs as well as corporate and private investors are gradually
increasing their activity," said Koby Simana, chief executive of
IVC. "As a result, I'm optimistic about the high-tech industry's
chances of maintaining the current level of capital raising in
the coming year."
Israeli high-tech companies are key drivers of the economy,
helping to spur growth of 3.3 percent in 2012.
Simana said a strong indication that the coming years will
be "fruitful" for Israeli high tech companies can be found in
early stage and seed rounds that took place in 2012. Seed
companies raised $146 million, up 55 percent from 2011, while
early stage companies raised $635 million, up from $562 million.
"These companies will evolve and grow and the existing
investors and other investors will back the successful companies
in the future. Thus, you can expect significant follow-on
investments in those companies in the coming years," he told
Also, 2012 was a record year in terms of the number of
companies raising capital and this is a good indication that
there is interest in early stage investments, Simana said.
Ofer Sela, a partner in KPMG's technology group, said the
Internet proved to be the most attractive sector as more than
twice as many early-stage Internet companies were funded in 2012
than in 2011.
"Technology developments in recent years in both cloud-based
infrastructure and content delivery platforms have enabled
Internet companies to mature and develop their intended
technology with greater capital efficiency than any other
sector," he said.
(Editing by Steven Scheer)