Apparently no one told Israel-based startups about the slowing pace of venture funding.
Wednesday is a good illustration of that.
DriveNets, an Israel-based cloud-native networking developer, secured a $262 million Series C led by D2 Investments. The company said the new round “considerably” increased the company’s valuation over its January 2021 $208 million Series B, which valued it at more than $1 billion.
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The round is the biggest for any Israel-based startup this calendar year, according to Crunchbase data.
In addition to that raise, Israel-based HR tech solution HiBob closed a $150 million round led by General Atlantic and valued the company at $2.45 billion. The raise came 10 months after it closed a $150 million Series C.
Those two rounds add to what has been a robust year in venture funding for VC-backed startups in Israel. While down rounds, layoffs and a drought in funding have dominated headlines in the startup community in the U.S. and elsewhere, Israel has continued to thrive.
Much like most of the world, last year was record-breaking in terms of funding for Israel’s VC-backed startups. Private companies took in more than $10 billion in funding in 627 announced deals, according to Crunchbase data.
However, through the first 7 1/2 months of this year, VC-backed startups in the country have already seen more than $6.8 billion flow to them in 328 deals. That puts VC funding in Israel on pace to hit nearly $11 billion—more than in 2021, despite deal flow slowing.
Other large rounds to Israel-based startups this year include:
- Property management platform Guesty closed a $170 million Series E just earlier this week.
- AI-based automatic video and analytics solutions developer Pixellot raised a $161 million Series D in June.
- Cybersecurity firm Cheq closed a $150 million Series C in February.
- Penetration testing company Pentera raised a $150 million Series C in January.
It is important to remember the U.S. is a leading indicator of the VC market. However, with so many other regions already showing a slowdown in funding, it would be reasonable to expect Israel—with a mature startup ecosystem—to have already followed suit.
According to the data, though, that has not occurred.
It’ll be interesting to see if the final 4 1/2 months paint a different picture.
Companies must have their current headquarters in Israel to be considered Israel-based.
Illustration: Dom Guzman
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