The inflow of venture capital to Israeli startups is extremely high compared to other countries — one only has to take a look at the posts I’ve written for this blog since I’ve started it. According to Israel Venture Capital Research Center, however, a drop is expected in VC funding of new startups in 2008, compared to 2007.
The economic downturn in the U.S. and internationally is undoubtedly one of the reasons. “When something happens in the U.S. and Europe, it happens here”, says Efrat Zakai, the center’s director. “It’s not an Israeli issue” of politics or security.
While some funds are closing and others are having trouble raising more money, there is still some $2 billion in capital that needs to be put to good use. 60% of that is targeted for new startups and the rest as follow-on funding for current portfolio companies. Despite the downturn, a few new funds, like AquAgro, SCPVitalife and MGIC have been successful in raising new capital.
Get the full scoop from Market Watch.
