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    Ivc q3 13-full_survey-final Ivc q3 13-full_survey-final Document Transcript

    • THE IVC-KPMG SURVEY Summary of Israeli Venture Capital Investments – Q3 2013 Marianna Shapira, Research Manager, IVC October 2013
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Table of Contents Methodology ........................................................................................................ 3 About the Authors............................................................................................... 3 Summary of Israeli Venture Capital Investments – Q3/2013 ......................... 4 Chart 1: Distribution of Israeli Venture Capital Investments by Type of Investor Q1/2011 – Q3/2013 ($m) ......................................................................................... 4 Israeli VC-Backed Transactions .................................................................................. 5 Chart 2: Israeli VC-Backed Deals Q1/2011 – Q3/2013 ($m) .................................. 5 Israeli VC Fund Investment Activity ........................................................................... 6 Chart 3: Distribution of First and Follow-on Israeli VC Fund Investments (%) ..... 6 Investment Rounds Excluding Israeli VC Fund Participation ..................................... 7 Chart 4: Israeli VC Funds vs. Other Investors (%) Q1-Q3/2012 vs. Q1-Q3/2013 .. 7 Capital Raised by Sector .................................................................................... 8 Chart 5: Capital Raised by Israeli Internet Companies ($m) ................................... 8 Chart 6: Share of Capital Raised by Israeli High-Tech Companies by Sector Q1/2011 – Q3/2013 ................................................................................................. 9 Capital Raised by Stage .................................................................................... 11 Chart 7: Share of Capital Raised by Israeli High-Tech Companies by Stage Q1/2011 – Q3/2013 ............................................................................................... 11 Legal Disclaimer and Copyright...................................................................... 13 -2- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Methodology This Survey reviews capital raised by Israeli high-tech companies from Israeli and foreign venture capital funds as well as other investors, such as investment companies, corporate investors, incubators and angels. The Survey is based on reports from 129 investors of which 34 were Israeli VC management companies and 95 were other entities. The survey covers total investments in the Israeli venture capital sector, including both VC-backed rounds – where at least one investor participating in the round is a VC fund – as well as deals not backed by venture capital funds. For more on our methodology please click here. For additional information, please visit: www.ivc-online.com Marianna Shapira, Research Manager, IVC +972-73-212-2339 marianna@ivc-online.com *** About the Authors IVC Research Center is Israel’s leading research center providing business leaders with an unmatched wealth of data on Israel's high-tech, venture capital and private equity industries. IVC products and services are used regularly by high-tech companies, venture capital funds, private investors, financial investors and institutions, as well as public entities such as the Central Bureau of Statistics, the Bank of Israel and the Office of the Chief Scientist at the Economy Ministry. IVC owns and operates the IVC Online Database (www.ivc-online.com) containing over 10,000 Israeli high-tech companies, venture capital funds, investment companies, angels and technology incubators, as well as news updates and lots more. Among IVC products and publications are the IVC Quarterly Survey, which for over 15 years has been analyzing capital raising trends by Israeli high-tech companies, as well as the most comprehensive guide to Israeli high technology and venture capital – the IVC High-Tech Yearbook. The 2014 edition will be published in April 2014. KPMG Somekh Chaikin’s technology professionals offer insights and experience accumulated from a long history of work with technology and life science companies. Through a global network of highly qualified professionals in Israel, the Americas, Europe, the Middle East, Africa and Asia-Pacific, KPMG helps clients address the opportunities and challenges driven by new business models such as cloud computing, mobile services and others. KPMG is a global network of professional firms providing Audit, Tax and Advisory services. KPMG operates in 146 countries and has 140,000 people working in member firms throughout the world. -3- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Summary of Israeli Venture Capital Investments – Q3/2013 In Q3/2013, 162 companies raised $660 million from local and foreign investors, the highest quarterly amount since 2000. This is an increase of 34 percent from $493 million raised by 143 companies in Q2/2013, and 35 percent from $488 million attracted by 143 companies in Q3/2012. (Chart 1) Chart 1: Distribution of Israeli Venture Capital Investments by Type of Investor Q1/2011 – Q3/2013 ($m) Five companies attracted more than $20 million each, accounting for 25 percent of the total amount raised in Q3/2013. Nine companies attracted between $10 million and $20 million each, accounting for 16 percent of the total quarterly amount. Fifteen companies raised from $5 million to $10 million each and 70 companies attracted more than $1 million each. The average company financing round in Q3/2013 was $4.07 million, compared to $3.45 million in Q2/2013 and $3.41 million in Q3/2012. In the first three quarters of 2013, 474 Israeli high-tech companies raised $1.63 billion, a 12 percent increase from $1.45 billion attracted by 413 companies in Q1-Q3/2012, and 4 percent above $1.56 billion invested in 422 companies in Q1-Q3/2011. The average company financing round was $3.43 million, while average financing rounds in Q1-Q3/2012 and Q1-Q3/2011 were $3.51 million and $3.7 million, respectively. -4- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Israeli VC-Backed Transactions One hundred and one VC-backed deals attracted $462 million or 70 percent of the total amount raised in Q3/2013. This compares to 86 deals totaling $399 million (81 percent) in Q2/2013 and 98 deals totaling $376 million (77 percent) in Q3/2012. Remaining capital raising rounds were completed by other investors – foreign and Israeli – without the participation of VC funds. (Chart 2) Chart 2: Israeli VC-Backed Deals Q1/2011 – Q3/2013 ($m) The average financing round of VC-backed deals was $4.57 million, compared with $4.64 million in Q2/2013 and $3.84 million in Q3/2012. In Q1-Q3/2013, 288 VC-backed deals attracted $1.23 billion or 75 percent of the total invested, an increase of 21 percent from the $1.01 billion (70 percent) raised in 257 VCbacked deals in Q1-Q3/2012, but a three percent decrease from $1.27 million (81 percent) invested in 297 transactions in Q1-Q3/2011. The average financing round for VC-backed deals was $4.26 million in Q1-Q3/2013, compared with $3.95 million and $4.27 million in the corresponding periods in 2012 and 2011, respectively. -5- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Israeli VC Fund Investment Activity In Q3/2013, $151 million was invested by Israeli VC funds, accounting for just 23 percent of total investments – the lowest quarterly share in a decade. This compares with $123 million (25 percent) invested in Q2/2013 and $130 million (27 percent) invested in Q3/2012. Remaining investments came from foreign and other Israeli investors. First investments in Q3/2013 were $52 million (34 percent of total investments), a 49 percent increase from the $35 million (28 percent) of Q2, but 9 percent below the $57 million (44 percent) of Q3/2012. Follow-on investments by Israeli VC funds accounted for 66 percent. (Chart 3) Chart 3: Distribution of First and Follow-on Israeli VC Fund Investments (%) Q3/2013’s average first investment was $2.74 million, while the average follow-on investment was $1.24 million. In Q1-Q3/2013, Israeli VC fund investments accounted for $418 million or 26 percent of the total amount invested. This compares with $388 million (27 percent) in Q1-Q3/2012 and $488 million (31 percent) in Q1-Q3/2011. First investments in Q1-Q3/2013 accounted for $145 million or 35 percent of total investments, compared with 34 percent and 26 percent in Q1-Q3/2012 and Q1-Q3/2011, respectively. Follow-on investments by Israeli VC funds made up the remaining 65 percent. -6- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Investment Rounds Excluding Israeli VC Fund Participation In Q3/2013, venture capital deals without Israeli VC participation attracted $317 million, 48 percent of total investments. This compares with $189 million (38 percent) raised without involvement of Israeli VC funds in Q2/2013 and $176 million (36 percent) in Q3/2012. Eight corporate venture capital funds participated in 10 deals accounting for $135 million in Q3/2013. Israeli VC funds took part in four of those deals. In Q1-Q3/2013, Israeli venture capital deals without involvement of Israeli VC funds amounted to $701 million, up 5 percent from $665 million in the year-earlier period, and 49 percent from $470 million in Q1-Q3/2011. (Chart 4) Chart 4: Israeli VC Funds vs. Other Investors (%) Q1-Q3/2012 vs. Q1-Q3/2013 -7- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Capital Raised by Sector In Q3/2013, 47 Internet companies attracted $179 million (27 percent), the largest quarterly amount for the sector since 2000. This is a 103 percent increase from $88 million (18 percent) raised by 33 companies in Q2/2013, and a 180 percent jump from the $64 million (13 percent) raised by 33 companies in the year-earlier period. (Chart 5) Chart 5: Capital Raised by Israeli Internet Companies ($m) The life sciences sector followed with 37 companies attracting $128 million or 20 percent of quarterly investments. This is a 6 percent increase from $121 million (25 percent) raised by 33 companies in Q2/2013, but a 23 percent decline from $166 million (34 percent) raised by 34 companies in the year-earlier period. In both previous periods, the life sciences sector led quarterly investments. Within the life sciences, the medical devices subsector attracted $68 million or 53 percent of the amount raised by the entire sector, followed by therapeutics with $57 million or 45 percent. Thirty software companies raised $104 million or 16 percent of all quarterly investments, as did seven semiconductor firms. In the previous quarter, 26 software companies attracted $81 million (16 percent) while in Q3/2012, 26 companies raised $74 million (15 percent). Ten semiconductor companies raised $66 million (13 percent) in Q2/2013 and nine raised $64 million (13 percent) in Q3/2012. Twenty-four communications companies followed with $81 million (12 percent – lowest share in two years), up 3 percent from $79 million (16 percent) attracted by 30 companies in the previous quarter, but down 22 percent from $104 million (21 percent) raised by 19 companies in Q3/2012. Eight cleantech companies raised $35 million or 5 percent of investments, compared with $56 million or 11 percent raised by nine companies in the previous quarter and $25 million or 5 percent raised by 15 companies in Q3/2012. Within cleantech, the agrotechnology subsector accounted for $29 million or 83 percent of the amount raised by the entire sector. -8- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Nine miscellaneous sector companies raised $29 million or 4 percent of total capital raised in Q3/2013, compared with two companies that raised only $2 million or one percent in the previous quarter and seven companies that raised $12 million or 3 percent in Q3/2012. (Chart 6) Chart 6: Share of Capital Raised by Israeli High-Tech Companies by Sector Q1/2011 – Q3/2013 In Q1-Q3/2013, 125 Internet companies led all investments with $371 million (23 percent of the total), up 36 percent from the $271 million raised in Q1-Q3/2012 (19 percent) by 99 companies and 8 percent from the $345 million (22 percent) raised in Q1-Q3/2011 by 88 companies. One hundred life sciences companies followed with $340 million or 21 percent, a 19 percent decrease from $418 million (29 percent) attracted by 104 companies in the yearearlier period, when the sector led all investments. Within the life sciences, the medical devices subsector attracted $195 million or 57 percent of the amount raised by the entire sector and 12 percent of capital raised by all sectors. Ninety software companies attracted $321 million (20 percent of total capital raised), compared with $221million (15 percent) invested in 65 software companies in Q1Q3/2012 and $278 million (18 percent) invested in 72 software companies in Q1Q3//2011. The communications sector was next with 85 companies that raised $228 million (14 percent), compared with 64 companies that attracted $241 million (17 percent) in Q1Q3/2012. Twenty-five semiconductor companies attracted $190 million (11 percent), an increase of 62 percent from $117 million (8 percent) raised by 23 companies in Q1-Q3/2012, and 28 percent up from $149 million (9 percent) invested in 43 companies in Q1-Q3/2011. -9- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Thirty-two cleantech companies followed with $127 million (8 percent), up 76 percent from the $72 million (5 percent) raised by 35 companies in the year-earlier period and 8 percent above $118 million raised by 39 companies in Q1-Q3/2011. The agrotechnology subsector attracted $58 million or 46 percent of capital raised by the sector in Q1Q3/2013. Seventeen miscellaneous sector companies followed with $50 million (3 percent), compared with 23 companies that attracted $110 million (7 percent) in Q1-Q3/2012. -10- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Capital Raised by Stage High-tech companies in this survey were divided into four categories: seed, early stage (R&D), mid-stage (annual revenues up to $10 million) and late stage (annual revenues over $10 million). (Chart 7) Twenty-five seed companies raised $17 million (3 percent) in Q3/2013, a decrease of 37 percent from $27 million (5 percent) raised by 32 companies in the previous quarter, and 60 percent below the $43 million (9 percent) attracted by 32 seed companies in Q3/2012. Within seed investments, Internet companies attracted the largest share – 35 percent – followed by software with 29 percent. Fifty-five early stage companies attracted $149 million (23 percent), compared with $149million (30 percent) raised by 52 companies in the previous quarter and with $189 million (39 percent) raised by 48 companies in Q3/2012. From among early stage investments, life science companies attracted the largest share of capital – 40 percent – followed by semiconductors with 18 percent. In Q3/2013, 69 mid-stage companies led capital raising with $366 million or 55 percent, the highest quarterly amount for mid-stage in a decade. This compares with $235 million or 48 percent raised by 51 companies in Q2/2013 and $211 million (43 percent) raised by 54 companies in Q3/2012. Within mid-stage investments, Internet companies attracted the largest share – 27 percent – followed by life sciences with 18 percent. Thirteen late stage companies attracted $128 million (19 percent), compared to eight companies that raised $82 million (17 percent) in Q2/2013 and nine companies that raised $45 million (9 percent) in Q3/2012. Within late stage investments, Internet attracted the largest share of capital – 39 percent – followed by semiconductors with 32 percent. Chart 7: Share of Capital Raised by Israeli High-Tech Companies by Stage Q1/2011 – Q3/2013 -11- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 In Q1-Q3/2013, 110 seed companies raised $75 million (5 percent of the total raised), down 26 percent from $101 million (7 percent) attracted by 105 seed companies in Q1Q3/2012, but 7 percent up from the $70 million (5 percent) raised by 81 companies in Q1-Q3/2011. One hundred and forty-four early stage companies attracted $390 million (24 percent) in Q1-Q3/2013, a 18 percent decrease from $473 million (33 percent) raised by 130 companies in the year-earlier period and a 6 percent decline from $414 million (26 percent) raised by 117 companies in Q1-Q3/2011. One hundred and eighty-nine mid-stage companies led all investments with $897 million (55 percent) in the nine-month period. The amount is up 48 percent from $606 million (42 percent) attracted by 148 companies in Q1-Q3/2012 and 29 percent above the $696 million (45 percent) raised by 181 companies in Q1-Q3/2011. Thirty-one late stage companies attracted $265 million (16 percent), compared to 30 that raised $270 million (18 percent) in Q1-Q3/2012 and 43 that raised $382 million (24 percent) in Q1-Q3/2011. -12- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com
    • IVC-KPMG Survey Summary of Israeli Venture Capital Investments – Q3/2013 Legal Disclaimer and Copyright This report is based on information available at the time of its preparation. Subsequent changes in variables and/or additional information may impact the data or conclusions of this report. IVC reserves the right to make updates and revisions from time to time. The information contained in this report is derived from the IVC-KPMG Quarterly Survey and from the IVC Research Center Ltd. ("IVC") database. This report is copyrighted. No part of the material in this report (including, but not limited to text, content and images) may be reproduced, republished or utilized in any form or by any means without the explicit and prior written consent of IVC Research Center. © IVC Research Center Ltd. 2013 October 2013 -13- IVC Research Center Ltd. 99 HaHashmonaim St., 2nd Floor, Tel Aviv 67133, Israel  www.ivc-online.com Tel. +972-73-212-2333 Fax. +972-73-212-2323 E-mail: info@ivc-online.com