from the April 2007 issue

Israeli VCs raised $473m. in 2006

In 2006, Israeli venture capital funds raised a total of $473 million, a 67 percent decline from the $1.46 billion raised in 2005. The drop was anticipated since most large Israeli VC funds completed their efforts in the previous two years, having raised a total of $2.52 billion in the 2004-2006 period.

Funds that raised capital in 2006 included Evergreen V (first closing, $135 million), Magnum II ($105 million) and Greylock Partners's first Israel-focused fund ($150 million), which followed the firm's reopening of its local office. Seven other venture capital funds announced first closings during 2006 for a total of $83 million. These included Infinity III, Peregrine II, Evolution Fund I, (focused on bootstrapped startups, two new cleantech funds - H2Tech and Terra - and a new Web 2.0 fund, Jerusalem Capital.

According to IVC estimates, $1.5 billion in capital is currently available for investment by Israeli VCs, of which $0.9 billion is intended for first investments in high-tech companies. The remainder is reserved for Follow-on investments. An additional $700 million is expected to be raised in 2007 by Israeli VCs for investment in Israeli high technology. Zeev Holtzman, Chairman of IVC Research Center and Giza Venture Capital, said, "It is expected that the next capital raising cycle of the leading Israeli VC funds - the fifth cycle since 1992 - will start later this year and will reach its peak in 2008. It is expected too that all the remaining VC funds - those that last raised capital in 2000 and 2001 - will also try to raise follow-on funds. Therefore, capital raised in vintage 2007 is most likely to be higher than in 2006. Currently, capital available for investment by Israeli funds equals two years investment, a markedly shorter period than in the US, indicating that there is no oversupply of capital in the Israeli market." Robot aims to take heat off Israeli infantry A new, smart Israeli military robot can fight its way down dark alleys, through caves and over rubble, seeking out bombs and booby traps along the way and warning human foot soldiers of enemies and danger ahead, its manufacturer said.

Elbit Systems, one of Israel's leading defense electronics companies, said its robotic point man, designated VIPeR, is small and light enough to be carried into battle on a soldier's back, but the 25 pound, 9 inch tall tough guy packs a full-size punch.

The remote-controlled unit can be fitted with a mini-Uzi automatic pistol, fragmentation, stun and smoke grenades, explosives sniffer and day and night vision cameras, Elbit said.

It can climb stairs and find its way around with preprogrammed mapping software. The company said that the Israeli military was planning to carry out operational trials with the VIPeR with a view to deploying it with infantry units.

After years of Palestinian-Israeli fighting, various kinds of robots are widely used by the Israeli army and police for inspecting suspect objects thought to be bombs, checking buildings for booby traps and sniffing out arms and explosives. Elbit said the VIPeR is currently making its first public appearance at the winter exhibition of the Association of the United States Army, in Fort Lauderdale, Florida.

Startup offers electronic wound-healing device Israel-based startup LifeWave has developed a medical device that it claims can treat chronic wounds by electrically stimulating tissues around the wound. The device is aimed at speeding improvements in bed sores which can occur in chronically immobile patients and other types of ulcer. The company was founded in 2000, and employs 8 workers.

LifeWave BST (Bed Sore Treatment) includes a pair of electrodes that are placed on the skin adjacent to the affected area and are connected to the device. The device delivers an electrical signal that the company claims mimics the electrical activity of a "normal wound" and in turn accelerates the healing rate. LifeWave claimed that BST is positioned to treat severe wounds including pressure ulcers, diabetic ulcers and venous ulcers.

According to the LifeWave website the BST device provides an alternating current of up to 20 milliamps with zero net direct current. The pulse frequency would appear to be 4 kHz with two pulses per second. The nervous system interprets the transmitted pulse from the damaged area initiates healing activity to the necrotic tissue, according to LifeWave.

Trials for the Life Wave BST device are scheduled to begin in February in Italy, Belgium, Austria and Sweden and the company is conducting clinical trials prior to marketing the technology in the United States. Israel Air Force begins absorbing new "Shoval" drones The Israel Air Force began absorbing on the new "Shoval" drone, which is the IAF nickname for the "Mahatz" drone manufactured by the Israel Aircraft Industries.

The drone, which is manufactured entirely by Israeli security industries, is considered the largest in the world, with a 16-meter wingspan. It will gradually replace the older Sarcher model.

The new drone has the ability to carry a 250-kilogram payload and fly at altitudes of up to 30,000 feet. The drone also has advanced surveillance and communications systems.

According to the IDF, the drone will be able to provide better assistance to troops on the ground, and also has an improved ability to identify the launch of projectile rockets such as Katyushas and Qassams. The IAF intends to purchase a series of drones of this model. One of its primary advantages is maximum flight time: roughly 30 hours without refueling.

Reprinted from the Israel High-Tech & Investment Report April 2007

Click HERE to request further information.
Click HERE to go BACK.