A year into the global COVID pandemic, January 2021 turned out to be a blockbuster year for the Israeli startup scene, with Israeli startups raising a record $1.44 billion, the NGO Start-Up Nation Central reports.
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According to SNC, six start-ups raised more than $100 million each (mega rounds) during the month, totaling 73% of the amount raised Israeli firms in January. Furthermore, the mega-rounds in January 2021 alone equaled nearly 30% of the total number of mega-rounds in the entire year of 2020 (21 total).
The companies that completed the six mega-rounds announced during January 2021 are Rapyd Financial Network (Fintech), which raised $300 million in a D Round; Drivenets (Network Infrastructure), which raised $208 million in a B Round; OwnBackup (Enterprise solutions), which raised $167.5 million in a D Round; digital health company K Health ($132 million in an E Round); E-Commerce firm Resident Home ($130 million in a B Round); and Fintech firm Melio ($110 million in a D Round).
This marks the highest number of both mega-round and general investments made during a single month in Israeli start-ups. To compared, there were three mega-rounds in January 2020, none in January 2019 or January 2018. The mega-rounds in January were led by US investors.
The analysis by SNC concluded that the January 2021 data reflected "investor confidence in Israel's innovation ecosystem curing the COVID-19 pandemic."
Director of Research at Startup Nation Central Meir Valman observed that "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."
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