Venture Capital - an Engine for Growth the Prime minister′s.pptVIP

OCS Grants by Technological Sectors (2004) Venture Capital Raised Total Amount Raised by Israeli High-Tech Companies ($M) Ingredients for Success –The Israeli Experience ? Entrepreneurial spirit ? Technological expertise Early Stage Investments –main pitfalls Thank You * * Early Stage Investments The Israeli Perspective Yigal Erlich Founder Managing Partner – The Yozma Group The Yozma Group - Overview Established: January 1993 Founder of the Israeli Venture Capital Industry $145M Under Management (Yozma I, II III) 48 portfolio companies (16 Exits) Early Stage Investor 4 partners Israel at a Glance Population – 6.6 Million Area – 21,000 sq km GDP – $112 Billion GDP/Capita - $17,000 Highest rate in the world of civilian RD expenditure as % of GDP (3.5%). By far, the highest number of engineers per 10,000 in population (136). Total exports – $27.7 Billion Net foreign debt (2003) - $0.55 Billion Inflation rate (2000 – 2003 average) – 1.75% Penetration: Mobile– 98%, PC– 43%, Internet– 42% Government Engine for the High-Tech Industry Direct RD Grants (OCS) Technology Incubators Venture Capital Yozma Tnufa Bi-National Funds Magnet Seed Fund Office of the Chief Scientist $400M/year Technology Incubators – Background / Main Goals Initiated in 1991 Located all over Israel, including Periphery Situated near Academic Institutes Built an infrastructure to exploit entrepreneurial resources $300K for 2 years / project + $200K/year for GA support Current Status 23 Technology incubators (best ones are privately owned) 5-6 Projects in each incubator per year ~1,000 Graduate Projects Privatization: 30% Bi-National Funds BIRDF - with U.S.A. SII-RD - with Singapore CIIRDF - with Canada BRITECH - with the UK KORIL-RDF - with S. Korea International Cooperation ? Yozma Proprietary No Venture Capital Funds Success in RD - Failure in Marketing Few IPOs, No MAs Lack of international involvement ~60 Venture Funds $10B raised by VCs $21B MA deals #3 in Na