Two Israeli-U.S. Startups Raises Combined $90 Million

JFrog secures $50 million, BlueVine $40 million, amid a surge of tech investment.

Inbal Orpaz
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JFrog employees at the company's research and development center in Netanya.
JFrog employees at the company's research and development center in Netanya.
Inbal Orpaz

Two Israeli-American startups said Wednesday they had raised a combined $90 million from investors, bringing the total for the local tech sector for the year to date to well over $300 million, just three weeks into 2016.

JFrog, a developer of open source software distribution tools, said it secured $50 million from new investors Scale Venture Partners, Sapphire Ventures, Battery Ventures, Vintage Investment Partners and Qumra Capital, as well as from existing investors.

BlueVine, which provides working capital to small businesses online, said it had closed $40 million in funding in a round led by Menlo Ventures. A second new investor, Rakuten FinTech Fund, also joined in the round as did existing investors Lightspeed Venture Partners, 83North and Correlation Ventures and private investors.

The latest capital brings fundraising by Israeli startups to nearly $340 million so far this year, a pace that could make it the biggest quarter for the industry in many years. Other big funding rounds this month include $50 million for Sisense and $35 million for Elastifile.

The rapid pace stands in contrast to the United States, where fundraising slowed in the fourth quarter of 2015. The U.S. investment research firm CB Insights said that funding to private U.S. companies fell to $27.3 billion in the quarter, down from $38.7 billion in the previous quarter and $27.7 billion a year ago. Fourth-quarter data for Israel are not yet available.

JFrog, which was founded in 2008 by CEO Shlomi Ben Haim, Chief Technology Officer Yoav Landman and Chief Architect Fred Simon, had raised just $12 million before the latest round. It will use the proceeds to double its employee numbers from 100 — around 75 at the company’s research and development center in Netanya and the remainder at its Santa Clara headquarters and at a sales office in France.

JFrog did not disclose financial figures on its operations, but it said it has over than 1,500 paying customers, including seven of the top 10 U.S. financial services companies, seven of the top 10 telecommunication companies and eight of the top 10 Internet and software companies.

BlueVine, which raised $18.5 million just a year ago, said the latest round brought its total funding since it was founded in 2013 to $64 million. It added that the round included a debt facility from Silicon Valley Bank.

BlueVine said it would use the proceeds to hire more managers, develop new features and develop new markets. BlueVine, which provides short-term loans of from $5,000 to $150,000 to small business through a process called invoice factoring, said the value of invoices it funded grew twelvefold last year and that the company is on track to fund more than $200 million in working capital in the next year.

The company’s 60 employees are divided equally between offices in Palo Alto and in Tel Aviv. The new capital will enable it to hire 30 to 40 new people, including between 10 and 20 in Israel, BlueVine said.