Israeli VC Fundraising Sees Massive Decline In 2023 – Report

Venture capital fundraising in Israel plummeted significantly in 2023 from the year before, according to the latest annual report by IVC–Gornitzky–KPMG Israel in association with the Israel Innovation Authority. 

The report, which explores investment trends in the Israeli tech ecosystem, found that in 2023 – a fraught year of protests over planned judicial reforms, the worst terror attack in the country’s history and three months of war – just 21 Israeli VC funds managed to raise $1.52 billion. 

The figures mark a drop of 74 percent in funds raised compared to 2022 (the lowest since 2015) and a 66-percent decrease in the number of funds. 

Just three venture capital funds accounted for 51 percent of the total capital raised. Qumra Capital IV, TLV Partners V, and Viola Growth IV each managed to raise more than $200 million apiece.

“Following the report’s findings and the market’s negative trends in 2023, the Innovation Authority implemented strategic initiatives to boost available capital,” said Dror Bin, CEO of Israel Innovation Authority.

“Notably, the Fast-Track program injected NIS 400 million into companies with significant business and technological assets and limited runway. The recently launched Start-up Fund plans to conduct 100 funding rounds for Pre-Seed, Seed, and Round A companies, investing approximately NIS 500 million,” he said.  

“In the near future, we also plan to launch the Yozma 2.0 Fund, which will engage Israeli institutional investors and incentivize them to increase their investments into Israeli Venture Funds to an overall investment of NIS 4 billion within 2024-25.”