TechNation: Experts Laud New Tech Finance Rules, Say More Is Needed

Twiggle raises $12.5 million for eCommerce search engine | East Jerusalem gets first boys' technology high school; Two startups raise $2.5m for vehicle security, cancer detection technologies.

The Tel Aviv Stock Exchange (TASE) building in Tel Aviv.
Bloomberg

Experts laud new tech finance rules, say more is needed

Israeli tech finance leaders lauded new rules that make it easier for startup companies to tap the Tel Aviv Stock Exchange for finance, but faulted the country’s institutional investors for backing so little in high-tech.

“If overseas, institutions are ready and willing to expose themselves to the industry and invest a lot of money in its potential, in Israel institutions are pulling out of local tech companies,” Robby Suleiman, of the accounting firm PwC, told a conference on the subject Monday.

“Israeli regulations aren’t the main obstacle. We have to change the thinking.” Amit Dror, CEO of the publicly traded tech company Nano Dimension, said he thought the new rules would encourage startups to float shares on the TASE before moving up to the Nasdaq stock market, but Guy Preminger, also of PwC, warned that interest in initial public offerings went through cycles.

“Today, the situation in Tel Aviv and the world is bad,” he said. “The fact that they’re offering benefits for three years isn’t quite the right time. They need to extend the benefits for longer — 10 years.”

Hani Shitrit Bach, head of the TASE’s economic department, said the bourse wasn’t really competing with Nasdaq for small tech companies because the U.S. exchange is generally unwelcoming to IPOs for startups valued at less than $500 million. (Shelly Appelberg)

Twiggle raises $12.5 million for ecommerce search engine

Twiggle, an Israeli startup whose technology collects data from ecommerce sites to help online shoppers, said on Sunday it had secured $12.5 million from an investor group led by the South African Internet group Naspers.

Yahoo Japan and Sir Ronald Cohen also participated in the round, as did State of Mind Ventures as a returning investor, the company said. The round brings total funding to $14.7 million for Twiggle since it was founded in 2013 by CEO Amir Konigsberg, one of Google’s first employees in Israel before he became CEO of the price-comparison site MySupermarket.com, and Chief Technology Officer Adi Avidor, formerly a lead software engineer at Google Israel.

“Today search engines on shopping sites work by breaking up a sentence into words. Our system tries to learn exactly that the shopper wants by deciphering the sentence, not by single words,” Konigsberg explained. Proceeds from the fundraising will be used to add 20 employees to the Tel Aviv-based company's staff, most of them in research and development. (Elian Rubin)

East Jeruslem gets first boys' technology high school

East Jerusalem got its first boys' technology high school last week, with 100 boys in ninth and 10th grades studying electronics, refrigeration and air conditioning and computer maintenance.

Set up at a cost of 17 million shekels ($4.5 million), operated by the Sakhnin network and supervised by the Economy and Industry Ministry, the school aims to meet the needs of East Jerusalem students looking for a program that provides a professional and academic educations.

About 20 such schools serve Israeli Arabs in Israel and a technical high school for girls in East Jerusalem opened about a year ago.

“The new school fill two important roles integrating the Arab population into the economy and job market, which will help narrow social gaps, and secondly providing an alternative to the Education Ministry’s academic high schools where not every student can find a place for themselves and end up dropping out,” said Shuli Eyal of the Economy Ministry. (Ora Coren)

Two startups raise $2.5m for vehicle security, cancer detection technologies

Karamba Security, which protects Internet-connected cars from hacking attacks, emerged from stealth mode last week and said it raised its first $2.5 million of outside capital.

The startup, which has been focused on developing its technology after validating it extensively with leading automotive companies, said the investors for the round were the U.S.-Israel venture capital fund YL Ventures and GlenRock, Leon Recanati’s private investment vehicle.

Meanwhile, Biop Medical, a developer of tools for detecting cervical cancers without a biopsy, said it also closed a $2.25 million financing round with Shanghai Creative Investments, private U.S.-based investors and the Israeli government’s Office of the Chief Scientist. The proceeds will be used to develop its first product and for clinical trials of the company’s prototype device at Semmelweis University Hospital in Budapest and Rabin Medical Center in Israel. The final product design is expected to be completed by year end. (TheMarker Staff)