TechNation: Lawmakers Approve Crowdfunding Rules

Israel launches bank cybersecurity center; Reduxio raises first $22.5m for storage tech.

Israeli startup technology.
Gil Shwed warns that the danger to banks from mobile devices is substantial. Bloomberg

Lawmakers approve crowdfunding rules

Israel’s startup entrepreneurs will be able to raise money through online crowdfunding platforms for the first time after the Knesset Finance Committee on Monday approved rules for the system. “The crowdfunding rules will enable the high-tech entrepreneurs of Startup Nation to realize their dreams,” said Shmuel Hauser, chairman of the Israel Securities Authority, which lobbied for the measures. Under the new rules tech startups will be able to raise up to 4 million shekels ($1.1 million) annually through authorized platforms for crowdfunding – raising money usually from small investors for new businesses or projects from a large number of people over the internet. Investors with declared income of 350,000 shekels annually or less will be authorized to invest 10,000 shekels per investment and a combined cap of 20,000. For those with higher incomes, the ceiling grows so that those with income of 750,000 to 1.2 million can invest up to 5% of their annual income. (Uri Tomer and Eliran Rubin)

Israel launches bank cybersecurity center

The Bank of Israel quietly launched a banking cybersecurity center a few weeks ago amid concerns about the sector’s vulnerability to attacks as it adopts apps and other technology. Banks Supervisor Hedva Ber told a banking conference on Monday that the new center aimed to reduce the number of cyberattacks, enable banks to react faster when they occur and create a mechanism for banks and government to cooperate in case of a nationwide attack. Gil Shwed, CEO of the network-security company Check Point Software Technologies, warned that the danger from mobile devices was especially big. “The risks from mobiles are not just from the bank’s app – even when a bank customer is talking to a bank clerk, someone can listen in on the call and record the details,” he said. “The level of readiness for threats by Israeli banks is much higher than the world average, but there are places not well protected, like mobile.” (Michael Rochvarger)

Reduxio raises first $22.5m for storage tech

Reduxio Systems, a U.S.-Israeli storage and data management startup, said on Monday it had secured $22.5 million of a funding round that could grow to as much as $32 million. The round was led by London-based C5 Capital. All existing investors, including Jerusalem Venture Partners, Carmel Ventures, Intel Capital and Seagate Technology, joined in the round that Reduxio said already doubles the amount of capital invested in the company. Proceeds will be used to fund research and marketing of the company’s leading software-defined storage platform. Headquartered in San Francisco with research and development operations in Israel, the company was founded in 2012 at the JVP Media Quarter in Jerusalem by Canadian Mark Weiner, who is now CEO, together with Israelis Nir Peled, who acts as chief technology officer, and Amnon A. Strasser, vice president for research. The company has 80 employees, 50 of whom are in Petah Tikva. (TheMarker Staff)