Israeli companies and startups raised a staggering $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 $956 million. The second-highest amount over the past year was in September 2020, when investors poured $1.2 billion in capital in Israeli companies.
January 2021 was marked by “mega-rounds” – financing rounds of $100 million or more – of which there were six; Israeli fintech startup Melio nabbed $110 million at a valuation of $1.3 billion; digital health startup K Health raised $132 million at a $1.4 billion valuation; DriveNets raised $208 million at a valuation of $1 billion; fintech-as-a-service provider Rapyd raised $300 million in Series D; cloud services and recovery company OwnBackup raised $167.5 million at a $1.4 billion valuation; and Resident Home, a US-based, Israeli-founded e-commerce platform company raised $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 percent of capital raised. As a monthly comparison, there were three “mega-rounds” in January 2020, and none in January 2019 or January 2018.
“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 Startup Nation Central (SNC), Meir Valman.
Despite the devastating pandemic, the Israeli tech ecosystem has remained rather resilient amid accelerated demand for advanced technologies in the software, fintech, and digital health markets.