Israeli companies and startups raised a staggering USD 1.44 billion in January 2021 alone, the highest amount of capital raised in a single month in over a year, according to a new report by Start-Up Nation Central.
In January 2020, by comparison, Israeli companies raised USD 956 million. The second highest amount over the past year was in September 2020, when investors poured USD 1.2 billion into Israeli companies.
January 2021 was marked by six “mega rounds”—financing rounds of USD 100 million or more. Israeli fintech startup Melio nabbed USD 110 million at a valuation of USD 1.3 billion. Digital health startup K Health raised USD 132 million at a USD 1.4 billion valuation. DriveNets raised USD 208 million at a valuation of USD 1 billion. Fintech-as-a-service provider Rapyd raised USD 300 million in its Series D round. Cloud services and recovery company OwnBackup raised USD 167.5 million at a USD 1.4 billion valuation. Resident Home, a US-based, Israeli-founded e-commerce platform company, raised USD 130 million.
It is the highest number of both mega round and general investments made during a single month in Israeli companies, Start-Up Nation Central noted. Most of the investments were led by US investors.
In 2020, 21 mega round investments were announced during the whole year, equivalent to 33% of capital raised. As a monthly comparison, there were three mega rounds in January 2020, and none in the same month in 2018 or 2019.
“The record level of fundraising in recent months is driven by two effects. One is the increasing maturity of the Israeli tech ecosystem, when rapidly growing startups are able to raise much larger rounds. The other is the effect of COVID-19 on Israeli companies, which pivot rapidly to address the challenges of the pandemic, but that will also stay relevant long after it is gone,” said director of research at Start-Up Nation Central, Meir Valman.
Despite the devastating pandemic, Israel’s tech ecosystem has remained rather resilient amid accelerated demand for advanced technologies in the software, fintech, and digital health markets.
This article first appeared in NoCamels, which covers innovations from Israel for a global audience.