Israeli pop star Noa Kirel took third place at the Eurovision Song Contest grand final in Liverpool on Saturday night.

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With her song "Unicorn," Kirel garnered 362 points, ranking after runner-up Finland's Käärijä and winner Sweden's Loreen. A returning champion, Loreen won the competition in 2012 with "Euphoria."

This year, she gained victory with her hit "Tattoo," becoming the second singer in Eurovision history to win the competition twice. The only other artist to do so was Ireland's Johnny Logan, who won in 1980 and 1987.

While the votes were being counted, Israel's Netta Barzilai, also performed on stage along with several other Eurovision icons.

Following the grand final, Kirel said, ""It exceeds the expectations, I am the happiest in the world."

Between the first semi-final on Tuesday, when Kirel performed, and the grand final on Saturday, Kirel garnered hundreds of thousands of followers on social media and "Unicorn" was viewed on social media, particularly YouTube, over two million times.

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Israeli pop star Noa Kirel's stellar performance at the first Eurovision semi-final on Tuesday made quite the buzz, and if social media were to use the winner, Kirel would be it.

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On Wednesday, Kirel reached one million followers on TikTok and since the beginning of the rehearsals for the competition in Liverpool has gained over 100,000 followers on Instagram.

Her live performance of "Unicorn" was viewed over a million times on YouTube, surpassing heavy favorite and returning champion Loreen from Sweden, who won the contest in 2012 with "Euphoria."

According to bookies' odds, Loreen is still most likely to win this year's competition, and Kirel ranks sixth on the list.

Kirel's TikTok on the official Eurovision page garnered the highest number of views, 5.4 million, while Loreen's "Tattoo" was viewed 750,000 times.

On the official Eurovision Instagram page, Kirel's performance broke records with 4 million views and Loreen garnered 1.5 million views.

"Unicorn" was the most popular web search in Britain and was trending on Spotify in Finland, Iceland, Ireland, Latvia, Spain, and Britain.

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Israel went against the tradition this year and chose pop star Noa Kirel to represent the country at the 2023 Eurovision Song Contest. 

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Kirel has garnered immense popularity in Israel over the years and consistently surprises her fans with music and more. Most recently, she joined Reichman University's developmental psychology course. 

Q: What made you want to take this course? 

"I thought to myself what would challenge and enrich me as well as give me a normal experience in my crazy life? I contacted the university, and it turned out that there was such an option – to attend once a week in person and once a week online. It's amazing to have such an opportunity."

Q: And why psychology? 

"Psychology often ties in with what I do, to understand processes better, the ups and downs, what I feel in my career, and in general the things that I go through in life. I also feel that I'm good at this. When my friends ask me for advice I know how to give them the right advice."

Nevertheless, what takes up most of Kirel's time is preparing for the Eurovision Song Contest to be held in Britain in early May. Until 2023, Israel's representative in the competition was the winner of the Kokhav Nolad reality television show, the Israeli version of the American Idol. The fact that Kirel would represent Israel this year was announced in August 2023. 

Interestingly, the pop star initially turned down the proposal, only to change her mind later. 

My agent "Roberto Ben Shushan told me that for the 2023 competition, there was a committee that would choose Israel's representative and he asked me what I thought. And I first said no."

Q: Why? 

"First of all, I didn't know whether I would be chosen or not, and even if they did, I didn't want it because I felt unsure. I never thought about this situation, because I'm used to the Israeli representative being chosen through reality TV. I got very nervous. I learned about the change on the news and had a lot of mixed feelings.

"For me, there are some major things here: I was chosen for Eurovision, I have to represent Israel with honor, and for the first time in my life, I am in a position where I need to compete. Everything happened so fast. A minute after the announcement, I started getting so many messages that I didn't even have a moment to digest it. Robert and my dad straight away thought that I should do it, but I was nervous. It's funny that I'm saying this, but it's really a confidence issue. This came out of the blue. I was too nervous and turned it down."

Q: And what made you change your mind? 

"As an artist, I didn't want to feel like someone else was making the decision for me. I want to be a part of the decision, and this is quite the decision to make! I needed time to think. I weighed up the pros and the cons, what I would need to give up, how it could benefit me, and after I thought about this, we decided to go ahead with it." 

Q: So how did that thought process go? 

"A lot of things happened. First of all, the positive response from Europe to my being chosen. I'll admit that I did not understand the power of Eurovision fans, which turns out to be huge, and I also spoke with [songwriter] Doron Medalie and [singer and 2018 Eurovision winner] Netta Barzilai. As a singer, I want to achieve fame abroad as well, and here there is an opportunity to perform on the largest stage in the world and to represent Israel, and it's hard to say no. I know that I am taking a chance, but I am ready to take it, among other things to prove to myself."

Q: And what is the risk in performing at Eurovision? 

"When you get to a high point in your career, you are more scared to take risks because you have so much more to lose. With every proposal I get I start off by thinking about what I would stand to lose. I'm not the Noa Kirel I was in the past when I was just starting out. Back then, I would shoot in many directions and see what worked. But now, I want to stay in the Noa that I am now."

Q: But the Noa you are today is different in many aspects – status, grandeur, success.

"Yes, and of course there's what to lose, but I also have a lot to gain. When I first began to perform at the Park Hayarkon in Tel Aviv, it was a great risk for me. I had never before held a concert with tickets being sold, and my first concert was there. And when the tickets were sold out, who could guarantee that I could give a concert for an hour and 40 minutes? We practiced and recorded the entire concert beforehand because we weren't sure that I would succeed."

Q: You mentioned before that you feel insecure. It really doesn't go with the image of the Noa Kirel that we know.

"I am confident, I know my worth and my capabilities, but of course, there are also insecurities. Certainly in a competition like Eurovision. It rests on my career and I am also representing an entire country and that is huge. There were people who told me it's nothing I cannot handle, but I wouldn't say that."

Q: Are you scared about disappointing others? 

"Of course, especially when so much is expected of me. I know that there are these expectations and I cannot change that." 

Q: Have you considered the possibility of not making it into the Grand Final? 

"Anything can happen, but I hope that this will not occur. We've had talks about what would happen if I didn't advance, or if I did make it into the Grand Final but didn't rank high, or if I won. We've thought about everything, and at some point, we realized that such talks are never ending and also irrelevant. Two months ago, I spoke with my therapist and she asked me what would happen if I ranked 10th and was unhappy with the result. That is beyond my control, but if I do my utmost, then I've done all I could do. 

"I am very goal-oriented, and oi va voi [Heaven forbid] if I don't win, but slowly slowly I understand that I need to let go because when it comes to Eurovision, what depends on me is to bring a good song and a good performance, and the rest is not up to me. 

"If I stress all the time over something that is beyond my control, I will suffer. Artists from all over the world understand that Eurovision is a stage to promote their careers and that happens even if you don't win. The way I'm approaching this is that it doesn't matter where I rank, I am representing Israel with pride and getting worldwide exposure, that is my victory. If I do everything that I expect of myself, then I will have already won."

Q: Nevertheless, what place would you be content with? 

"If I rank within the first five, I would be happy, but then again, the true victory is my performance on stage."

Q: How did you prevent your song from being leaked? 

When working on it, "we all put our phones aside, including my parents, and suddenly I realized one of the employees in the studio was recording. When we asked him whether he was recording, he said no, and we checked and saw that he recorded everything and we asked him to delete it. After all that secrecy, I can work for the Shin Bet itself."

Q: Do you already have plans for after Eurovision? 

"I have a plan for the year ahead regardless of the results. Even if I fail in terms of the results, I am planning to persevere. It will be difficult, but it's part of the journey. The day after Eurovision I'm already giving a concert at a private bat mitzvah celebration." 

Kirel will be representing Israel with the song "Unicorn," which was released after great anticipation last month. Just hours after its release it broke records by becoming one of the most listened-to songs in Israel. It was also lauded by Israel's representatives to Eurovision from previous years as well as critics and social media users. 

Kirel recalled the process of creating the song, "I had complete artistic freedom. I didn't need to ask anyone to not get involved, rather from the very beginning I was given the freedom and the trust to do it.

"We made four songs, two of which were recorded abroad, and then another song, 'Unicorn.' They were put up for a vote and 'Unicorn' was chosen unanimously. I was very involved, both in terms of lyrics and the melody. It was also important to me that the song included some lyrics in Hebrew and that part I wrote myself. This is a song of empowerment to everyone – women, men, and all people. Everyone needs a unicorn in their life."

Q: And whose laughter can be heard in the middle of the song? It's quite unusual. 

"It was completely unplanned. When I first recorded the song and I got to the 'You wanna see me dance' part, I burst into laughter, and we kept it. This song is cheeky. It has everything. It has a Eurovision-like chorus, but it's not boring. One would also expect a repeat of the chorus in the end, but we didn't do that because it was important for me to showcase my dancing abilities. It was crucial for me that since I was already performing, to bring something unique that was never before."

Q: And what will the performance look like? 

"We are building it now. We're still thinking about whether it should be the same, or to add some oomph, but for me, it's important that it should be as wow as possible. Everyone already knows what the performances of other countries will look like, and I'm using that to my advantage because no one knows what mine will look like until rehearsals. For example, when I saw Sweden's performance, my jaw dropped, but we saw it two months before the competition, and at some point, you just get used to it."

Q: You are currently ranking fifth on the Eurovision forecast. How important do you think that is? 

"In the beginning, I cared about it, but the moment you understand what it's all about and the idea, you let it go. These forecasts change every hour, and I have no control over it. Why should I be upset about something that might affect my energy and motivation? Of course, being higher up is great, but it will go up and down, that's how it is." 

Q: A good performance can make all the difference. 

"Which makes it even more stressful because the performance is very important and, like you said, could make all the difference. But I also keep reminding myself that this is what I've done my entire life, and I'll keep working to make sure that the performance is as impressive as possible. I approach it as a Super Bowl performance with the conditions of Eurovision. I cannot fly above the stage and bring 40 dancers, but I will bring the best that I can. I will work very hard on the dancing, and I will have five dancers with me on stage."

Q: Did you receive any criticism against "Unicorn"?

"Some said the song is not good enough to represent Israel, but as with every song that I release, some love it and some don't."

Q: Your song is under 3 minutes, which is unusual for Eurovision. 

"It's currently 02:51 long. I believe there will be some changes and it will be 02:55 long. The song is full of elements and I don't want to overdo it, but there will also be a surprise in the middle, a pause. But we won't repeat another chorus. That's boring. I thought about what made me special, the fact that I dance, and that is how I will finish the performance. When you do something different, you have to take into account that not everybody will like or understand it." 

Q: And what about the outfit? 

"I was approached by all kinds of international designers, but we decided it was best to choose an Israeli one. When it comes to Eurovision, many think that the outfit has to be over the top, so we asked for a few sketches, and most performers have indeed chosen that kind of look, but that's not what I'm going for. My song is not a boring Eurovision song, and I want my outfit to not be boring either."

Q: Your boyfriend, Tomer Hacohen, will he be accompanying you?

"He's coming with me for two weeks for the preparations and the concert itself. He is very supportive, understanding, and happy for me, and it's great and important." 

Q: When it comes to Eurovision, one cannot help but think about the internal crisis in Israel. Do you think that might affect how you do at the competition? 

"Sure. I will even have briefings, as politicians do, on the matter. In general, I know that what I want to say is that I'm proud of my country, the most beautiful country in the world. And in any case, I am not representing Israel politically, but I represent it in music, and that is what I will do." 

One of Kirel's main competitors is Sweden's Loreen, who won the competition in 2012 with her hit "Euphoria."

"Loreen is amazing and it's stressful, but statistically speaking, to win twice is very difficult and has only happened once so far. I think her song is amazing and her performance is great." 

Q: Do you have any favorites? 

"England. Although it's not your usual Eurovision performance, it looks super cool and the song is good. Finland too caught my attention."

In August 2020, Kirel announced her intentions to achieve fame in America and signed with the US music label Atlantic Records. She has since released several songs, although they did not lead to the coveted breakthrough, and her international career has yet to expand. 

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"Eurovision came up and now the direction has changed a little and I'm flowing with it. Many artists achieved success in America through Europe, like Dua Lipa. You never know what could lead to what, so I'm open to the possibilities. Right now I'm focusing on Eurovision and am not releasing news songs in the US, but 'Unicorn' is in English and it's on all my platforms. Maybe through my Eurovision performance, I'll make it in the States as well. For now, I've changed the route a little and am focusing on Eurovision, but it's all happening at the same time. Atlantic Records were in favor from the very beginning. They loved the song and jumped on the idea." 

Q: Is it possible that you'll change your focus to Europe altogether? 

"Eurovision is a massive platform, and to first appear in Europe is a fantastic idea I think. Of course, the market is bigger in the States, but success in Europe is also international." 

Q: What are your plans in the meantime? 

"We don't want to overdo it, but to focus on the Eurovision performance. I will not be performing 'Unicorn' until then to keep it until the competition."

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Israel's high-tech sector experienced a record year in 2021 as startups raised $25.4 billion from January to November, while 33 companies reached unicorn status with valuations of $1 billion or more, according to a report published Monday by Start-Up Nation Central (SNC).

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Compared to $10.8 billion raised in 2020, this year's figure represents a 136% increase.

"Two years into the COVID-19 pandemic, the Israeli tech ecosystem is stronger than ever," said Avi Hasson, CEO of SNC.

"In a world where digital has become the default, Israel is a world-class source of solutions to global challenges."

Funding in Israeli startups and companies was 71% more than the global average, as shown by data compiled by the research firm Pitchbook.

"This… raises the question of whether Israel has made the transition from being the Start-Up Nation to the Scale-Up Nation," Hasson said.

Hasson also pointed out that Israeli companies were dealing with a shortage of qualified employees, with tens of thousands of high tech jobs unfilled. According to Hasson, SNC was extending a had to Israeli tech firms by launching training programs for high-tech workers and helping connect Israeli entrepreneurs to governments, corporations, and investors.

The three largest sectors in terms of funding were fintech, enterprise IT and data infrastructure, and security technologies, the SNC report said.

Israel also saw 33 privately-held technology companies join the billion-dollar club in 2021, bringing the total number of unicorns (companies valued at $1 billion or more) in the country to 53.

The new unicorns include biotech firm Immunai; robotics startup Fabric; cybersecurity startup Wiz; fintech firm Melio; and music app maker JoyTunes.

This article was first published by i24NEWS.

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TAU Ventures, the investment fund of Tel Aviv University, has announced raising a second fund of $50 million for investments in startups, with the opportunity to grow the fund to $70 million.

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The fund invests in early financing stages, often investing the first money in the company or after angel investment, a stage where there is a shortage in the industry.

The fund intends to invest in 15 to 25 companies founded by Israeli entrepreneurs, with investment amounts up to $1 million per venture as a first investment.

TAU Ventures emphasizes creating value for entrepreneurs with various university resources. The fund focuses on backing strong teams of entrepreneurs across a wide range of sectors, understanding that at an early stage the product is expected to change.

All investors from the previous fund have reinvested in the current fund. Both funds were led by Chartered Group, which brings together many leading entities from the Japanese industry, plus new investors, including Family Offices in the US, Canada and Europe.

TAU Ventures was established in 2018 by managing partner Nimrod Cohen in conjunction with Tel Aviv University. Cohen previously led first investments at companies such as HOUSEPARTY, Coralogix, WSC SPORTS, BRINGG & YOTPO.

Alumni of Tel Aviv University are ranked 5th globally as top university producing VC-backed entrepreneurs and 8th in the world in creating unicorn companies.

TAU Ventures' first fund, which included $20 million, launched in 2018 and made 18 investments in companies that included: SWIMM, Xtend, Gaviti, MyAir, Castor, Medorion and more. The first fund IRR is in the top 10% compared to all US funds from the same size and vintage.

According to Cohen, "We are in a period where a lot of money is circulating in the market. However, this can be misleading as there is still a shortage of investors in the early stages in Israel. More investors are operating in A or post-seed stages. They do not talk to entrepreneurs in the initial stages and rather want to see a product that has already reached the market. We are covering this critical stage enabling new companies to emerge."

Tel Aviv University President Ariel Porat said, "As part of Tel Aviv University's strategic plan, we have made it a central goal to strengthen ties with industry here as well as promoting an international and multidisciplinary campus. TAU Ventures provides for entrepreneurs a platform with significant opportunities in innovation and making academic progress beyond the campus boundaries. It enables students to integrate practical experience with leading startups during their studies, and at the same time, it enables entrepreneurs to enjoy the diverse qualities of the campus. I'm happy in the given trust of the investors in TAU Ventures and I'm sure that combining forces between academia and industry will provide in the near future significant technological achievements that will benefit the entrepreneurs, the university and society at large."

Eyal Agmoni, who heads lead investor Chartered Group, said, "We are happy and proud to be the lead investor also in the second fund of TAU Ventures. As a result of the success of the first fund, combining with proving the model in which we help young Israeli companies break into the Japanese market, it was natural to continue the successful cooperation and even strengthen it."

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Finding the right team is critical for a startup's success and most aren't taking the right approach, finds research from the University of Maryland's Robert H. Smith School of Business conducted in collaboration with researchers from the Technion-Israel Institute of Technology.

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With the right strategy – a mix that has founders both liking each other due to shared values and experiences and having the proper complementary skills and capabilities – startups can foster better team dynamics and have more success raising funds, being productive, and earning profits, the researchers found.

Maryland Smith professors Rajshree Agarwal, Gilad Chen and Brent Goldfarb collaborated on the study, published under the title "Forming Entrepreneurial Teams: Mixing Business and Friendship to Create Transactive Memory Systems for Enhanced Success" in the Academy of Management Journal, with co-authors Moran Lazar and Miriam Erez of the Technion and Ella Miron-Spektor of INSEAD.

The findings also are summarized via whiteboard animation: "What's the Best Way to Build a Startup Team?"

The research team, which Chen assembled using the approach the research prescribes, looked at how startup founders form teams and how their formation strategy affects the new venture. "Formation strategy is important for building strong transactive memory systems – the combined knowledge within the team of who knows what and how the team uses this shared knowledge to efficiently and effectively solve problems and make decisions," Agarwal says.

"New venture teams are really the whole entity of an organization in its infancy," Chen says.

There are basically two ways co-founders find each other, say the researchers. The first is all about interpersonal bonds created through prior experiences – perhaps college friends, former colleagues, or family members. The second is by seeking out people who have the capabilities and competencies needed.

A hybrid formation strategy works best, Goldfarb says, but few startups – about 1 in 10 – actually use it. That's likely because it is more difficult.

"To get the team with that perfect combination of having both the resources and the right mindset, and the right level of comfort that you share with each other, that's hard to do," Agarwal says. "Creating teams requires intentional thought and attention to these two things. It's going to be hard, and it's going to be rare, but if you do it, there are huge performance benefits."

In one study, the researchers looked at new technology startups on the crowdfunding platform Kickstarter and coded whether co-founders selected each other based on interpersonal attraction, resource-seeking, or both.

"We were able to link these strategies to the amount of funding they actually raised," says Chen. "A minority of those teams – about 10% to 15% – engaged in the hybrid team formation, but there was a huge dollar-value premium for those teams."

So why is the hybrid approach to team building so much more successful?

"Founding teams have a lot of key decisions to make and they need to swiftly come to agreement on the best alternative among many options," says Agarwal. "Each member is important not because they are just dividing and conquering all of these tasks, but also because they're brainstorming and problem-solving on what should be the right solution. For that, team members need complementary skills, but they also need to trust in each other."

The researchers ran another field study with an entrepreneurship competition and incubator program at Technion in Israel. Founders were asked to describe how they formed their teams as part of the application process. "We were able to show that hybrid teams were more successful, and we were also able to verify that it was the transactive memory system – that ability to really understand who knows what and integrate that differential knowledge better as a team – that explained why hybrid teams succeeded," Goldfarb says.

A third study was conducted at Maryland Smith in a series of entrepreneurship courses developed by Goldfarb in Smith's undergraduate and online MBA programs. The researchers experimentally seeded teams according to the different strategies, then followed them as they developed real businesses and raised funding throughout the class. Again, they found that the hybrid teams fared best because of stronger transactive memory systems.

"The chemistry is just as important as the capabilities," Agarwal says. "Ignoring one or the other will lead to fault lines later in the team's transactive memory systems."

Still, there's hope for new ventures that don't initially take the hybrid approach. As they bring on new team members, these startups should balance their initial strategy by using the other one. "It is an iterative process," says Chen.

The findings can also extend beyond startups to any organizational team, say the researchers. While the study deliberately focused on the embryonic phases of an organization with startup teams, the results apply in other contexts too.

In fact, as Agarwal, Goldfarb and Chen all noted, their own author team dynamics benefited from the hybrid approach.

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Israeli high-tech companies saw record capital investments in the first three quarters of 2021, raising $17.78 billion in 575 deals, the IVC-Meitar Israeli Tech Review report, published this week, reveals.

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The amount raised in Q1-Q3 2021 was 71% larger than in the same period in 2020, an increase mainly attributable to deals over $100 million, which accounted for a 51% share of the total amount raised in this tri-quarter period.

In Q3 alone, Israeli start-ups saw 177 investment deals worth a total $5.89 billion.

Attorney Mike Rimon, a partner at Meitar Law Offices, which co-published the report, noted that despite a "certain slowdown in IPOs for Israeli tech companies," his firm expected to see "significant equity financing activities as well as growth in M&A [merger and acquisition] transactions due to an increasing number of companies that have raised significant amounts."

Rimon said that recently, Israeli companies have been acquired by other Israeli companies – an exit channel that even a few years ago was marginal.

"We expect this trend to become more common in the near future," Rimon said.

The first three quarters of 2021 were notable for mega-founds of fundraising (defined as rounds yielding $100 million or more), with 53 such rounds completed in the same period worth a combined $9 billion.

Early fundraising rounds (seed and A) also increased in Q1-Q3 2021, with 293 such deals bringing in a combined $2.5 billion, 35% more than in the same period in 2020. Median amounts raised in seed and A rounds reached $4 million – evidence of growing capital intake in early rounds.

Later rounds raised $15.3 billion (85% of total) in 282 deals in Q1-Q3, due mostly to foreign investors involved in Israeli capital raising. Q3 saw $4.3 billion invested in later rounds alone, compared to a quarterly average of $1.86 billion in 2020. Israeli investors also upped their involvement in deal-making, although the increase was significantly more modest.

From seed rounds to exits

The first three quarters of 2021 also saw record Israeli high-tech exits, with 180 transactions accounting for a total $18.92 billion. The majority of capital volume derived from IPOs – 52% of total amount, exceeding M&A proceeds.

A total of 65 Israeli high-tech companies went public in Q1–Q3/2021 in IPOs that totaled $9.78 billion, a 225% increase in number and 506% increase in capital from 2020 annual figures. Their overall post valuation reached $76.4 billion. The two most prominent IPO proceeds in Q3 2021 were made by Riskified ($418 million) and REE Automotive ($288 million). A total of Israeli high-tech companies opted to go public on the Tel Aviv Stock Exchange.

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Attorney Shira Azran of Meitar Law Offices noted that the COVID pandemic continued to make its effects felt, explaining that "The technology sector accelerated with the world digitizing and transitioning to cloud in all areas, and along with the increased demand for cyber solutions."

"In addition to continued growth of mature companies, we see two main trends – first, the increase in early-stage and seed rounds, and second is the increased participation of US investors, in all stages of investments in Israeli companies. We expect these trends to continue for the remainder of this year and next year," Azran added.

Gilad Zwick contributed to this report.

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Despite the global COVID pandemic of 2020, which affected nearly everyone on the globe, Tel Aviv high-tech companies and startups flourished, according to a new report published by the Tel Aviv-Jaffa Municipality and the IVC Research Center, which reviewed data about the city's innovation ecosystem as of Jan. 15 2021.

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According to the Tel Aviv Innovation Ecosystem Report 2020, Tel Aviv-based tech companies accounted for 20% of the Israeli tech workforce and generated nearly half of the total volume of investments and exits value in 2020.

An assessment of the Tel Aviv tech ecosystem by technology type of technology shows that the city is in continuous transition, from start-up city to deep tech capital. The leading tech clusters in Tel Aviv in 2020 were AI (Artificial Intelligence), Fintech, Big Data and SaaS. AI was the leading tech cluster in Tel Aviv, capturing 43% of all Israeli AI companies, followed by fintech companies (42% of all fintech companies). AI and cyber security cluster were the leaders in terms of investments and exits' volume.

The report also found that in 2020, a record $6.839 billion was invested in 416 Tel Aviv companies. This is 48% of the total investments in Israel and reflects an increase of 34% from 2019. Tel Aviv-based companies comprised 48% of all investments in Israeli tech companies.

In addition, the average round tripled over the past three years from $5.1 million to $16.4 million.

The report found that 60% of the investments in Tel Aviv companies went to scale-up companies, and 30% of the investments to the pre-scale companies. Early-stage companies attracted just 10% of the volume of capital, in line with same trend across Israel.

Over two-thirds (68%) of all investment in Tel Aviv companies was made by foreign investors based in 35 countries, led by the US, followed by the UK, China, and Germany.

When it comes to exists, Tel Aviv tech startups and companies hit a record exit value of $4.43 billion in 53 deals in 2020, 46% of all Israeli exits for the year by value and an increase of 20% over 2019 and a huge leap compared to 2016, which saw $883 million in 36 exits.

Three Tel Aviv companies completed IPOs in leading stock exchanges: NYSE, Nasdaq and Euronext in 2020.

In addition, the report noted that of Tel Aviv's 20 tech unicorns (companies valued at $1 billion or more), 14 reached unicorn status during the pandemic year.

Tel Aviv Mayor Ron Huldai said that "The Tel Aviv-Jaffa innovation ecosystem enjoyed a remarkable year, breaking many records. Throughout the report, it is clear that outstanding human capital is one of the main reasons for the success of the ecosystem.

"Tel Aviv's talent is a magnet for multinational corporations and foreign investors who join the growing local scene of innovators. The tech industry demonstrated its value to our city and country throughout this challenging year, while its cutting-edge ideas and developments remain at the forefront of global innovation. Tel Aviv-Jaffa will remain an international center of attraction for human capital and financial capital," Huldai added.

Taking a broader look at the Tel Aviv tech scene, the report says that 29% of all tech companies in Israel are based in Tel Aviv, which also hosts 115 multinational R&D centers. In the past five years, the number of tech companies active in Tel Aviv grew by 25% compared to a 16% increase in all of Israel, the report notes.

Meanwhile, the years 2016-2020 have seen 44% growth in the number of Tel Aviv-based investors, notably in VC funds and investment groups. According to the report, Tel Aviv witnessed 89% increase in the number of VC funds and 70% increase in the number of venture capital management companies. Foreign investors, who account for 68% of all investors in Tel Aviv companies during 2020, are based in 35 countries, led by the US, followed by the UK, China, and Germany.

Guy Holtzman, founder and CEO of IVC Research Center said, "With 50% of Tel Aviv startups currently at growth stages of development, the city becomes very attractive for foreigners, as shown by the growing number of multinationals and investors involved in Tel Aviv's tech life."

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Not only is Israel shifting from "startup nation" to "scale-up nation," but the time it takes Israeli startup companies to scale up – even to "unicorn" (valued at $1 billion or more) status – is decreasing, according to a new report compiled by Jonathan Cohen of Catalyst Investments.

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Cohen investigated the numbers behind the recent change in the Israeli startup ecosystem, and found that the shift from "start-up" to "scale-up" reflected a change in the influence of US investors in Israel.

US-based corporate and financial institutions have increased their exposure in Israel and are now predominant, both in terms of investments and exits, Cohen explained.

"If we look at the investment rounds above $100 million, more than 70% (including all the rounds ever) occurred from 2019, and 27 rounds (i.e. 33%) were completed this year, from January to May 2021. Out of these 27 rounds above $100 million, 23 were led or co-led by American institutions. As comparison, only a third of the rounds were led by American investors prior to 2019," Cohen said.

"There are many reasons to explain the increasing amount invested by US investors: First, the Israeli VC and PE ecosystem is maturing, with more companies and experienced entrepreneurs succeeding in convincing US corporates and institutions to invest larger amounts in the country. Second, the 'startup nation' has developed a large number of companies valued between $300 million and $3 billion that are good targets of mid-cap and large-cap investors, for either large investments or buyouts. Third, American investors consider that Israeli companies are cheaper than US companies, and are willing to invest in them as they know that Israeli companies will relocate their headquarter in the US to help for the future exit.

"Lastly, Israel's ability to cope with crises such as COVID-19 was a great advertisement for the Israeli companies and its economy as a whole," Cohen continued.

According to Cohen, the development of the Israeli market also attracts investors from the rest of the world.

"Catalyst receives a lot of investments inquiries from Asia and the EU, as investors want to increase their exposure to the Israeli tech. The fact that the US is the first mover in terms of large investment rounds opens doors to other large international investors, notably Chinese players. With an increasing maturity of other regions such as Asia and the GCC, Israel could expect to be, one day, the home of more than 100 unicorns," he said.

According to the report, capital invested in Israeli high-tech increases every year and in 2020 reached some $10 billion. Over 80% of the investments in 2020 were directed toward growth-stage investments, from $2.5 billion to $8.5 billion over the last five years. In Q1 2021, the trend was similar, with $5.4 billion invested in Israeli high-tech. US institutions generally invest alongside leading local funds, as those funds offer a presence in Israel to support the company.

Meanwhile, the average time it takes for Israeli tech companies to become unicorns has decreased by half in the past decade. For Israeli unicorns established after 2008, it took an average of six years to reach a billion-dollar valuation, compared to an average of 15 years for Israeli unicorns established from 1999 to 2008. The number of Israeli unicorns has soared in recent years, from one in 2013 to 18 in 2019, and 65 in May 2021 – more unicorn companies than in all of Europe.

Exits for Israeli startups show a similar trend. From 2017 to May 2021, 70% of the 102 merger and acquisition deals over $100 million were completed by North American acquirers, compared to 13% from Europe, 7% from Asia, 9% from Israel and 1% from Australia.

IPOs also reflect the same development – with 77% of Israeli IPOs completed on the Nasdaq and New York Stock Exchange, with another 15% on the Tel Aviv Stock Exchange, and 8% on the Euronext.

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With Europe in coronavirus lockdown, venture capital fund manager Fergal Mullen told his investors in April he would find it hard to back a startup without first meeting its founders.

A couple of months later, the Geneva-based co-founder and partner of Highland Europe broke his own promise and invested in Meditopia, a mindfulness app with teams in Berlin and Istanbul that he got to know over some 40 calls on video app Zoom.

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"I had to eat my hat," said Mullen, looking back on a year of deal making that, after a sudden stop in the spring, came back to life in late summer and has gathered pace since.

Highland Europe has just raised 700 million euros ($850 million) for a fourth fund, its largest, and is preparing for the sale or flotation of around 10 of its portfolio companies next year.

And, according to interviews with more than half a dozen investors, the wider recovery in European tech investment activity looks likely to extend into 2021 as venture-backed startups achieve scale.

Proceeds raised by European venture funds have already hit an annual record 17.1 billion euros in the year to date, while the amount invested in startups has reached 39.7 billion euros, according to data platform Dealroom.co.

Taking into account reporting lags, the final sum invested is on track to beat last year's all-time high of 40.3 billion euros, said Tom Wehmeier, partner at Atomico and author of the closely-watched State of European Tech 2020.stateofeuropeantech.com report.

"The scale of those outcomes is getting bigger and bigger, and the velocity in which value is being created - it's getting faster and faster," said Wehmeier, pointing to the 115 venture-backed "unicorns" in Europe valued at more than $1 billion.

While Europe still lags North America by four to one in dollars invested in tech startups, the institutional money flowing into venture capital has grown threefold over the last five years.

Nearly two-thirds of venture capitalists and 70% of their investors expect European tech to gain ground on the United States and China over the next decade, according a survey by Atomico.

Early-stage and growth investor Index Ventures raised $2 billion just before the coronavirus pandemic hit, and soon discovered that remote working enabled it to review and do deals far more quickly.

"We never had a slowdown and had a lot of dry powder," said partner Martin Mignot. "With everyone remote we can see and meet more entrepreneurs."

Where deal flow has slowed is via exits onto public markets, with proceeds from initial public offerings (IPOs) by European technology firms less than half their 2018 peak even as a string of IPOs took US markets by storm.

That partly reflects the growing depth of private markets, however, say investors who point to Klarna, the Swedish financial technology company, achieving a valuation of more than $10 billion in its latest funding round.

UiPath, whose software helps automate routine business tasks, has achieved similar "decacorn" status while still private and, like Klarna, is eyeing an IPO in 2021.

The Romanian startup now has a US headquarters and plans to float there. That's a common route for European startups chasing rich US valuations and founder-friendly listing rules - and a challenge for Europe's tech ecosystem, investors say.

UiPath was backed in its infancy by Earlybird, whose emerging Europe fund turned heads in June when Istanbul-based Peak Games, in which it had invested, was sold to Zynga Inc for $1.8 billion.

Such deals are breeding new startups even in parts of Europe previously little known for home-grown tech entrepreneurship.

"Every liquidity event, every acquisition, every IPO ends up spawning groups of these talented people," said Earlybird's Cem Sertoglu.

While the remote working trend is helping founders take on global markets without having to relocate to Silicon Valley, it is also taking the edge off the near-term risks arising from Brexit − Britain's looming exit from the European single market.

"It won't affect the momentum that much in 2021, given how much pent-up demand there is, how much money is sitting on the sidelines, and how many conversations are happening," said Erin Platts, the London-based regional head of Silicon Valley Bank, a specialist lender to technology firms.

Britain has actually extended its lead this year in venture fund raising and its tech startups have attracted a third of total European investment, Dealroom.co data show.

It also remains the preferred landing zone for US software firms seeking to gain a foothold in Europe, said Stephen McIntyre of early-stage investor and advisory firm Frontline.

"The only people who are talking about Brexit are the Brits and Irish," said McIntyre. "With US CEOs, not only does it not come up – they honestly think it's done."

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