Israeli Tech Fundraising Wave Continues: Three Startups Raise $75 Million

ClickTale leads the pack with $35 million round amid tide of startup cash.

Inbal Orpaz
Inbal Orpaz
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ClickTale CEO Tal Schwartz
ClickTale CEO Tal Schwartz
Inbal Orpaz
Inbal Orpaz

The wave of double-digit tech fundraising showed no signs of letting up; three Israeli startups saidyesterday they had raised or were about to raise amounts between $15 million and $35 million from investors.

At the top of the list was ClickTale, whose software enables website owners to see how users behave on their sites, which said investors led by the U.S. private equity firm KKR had agreed to put $35 million into the company. It was the U.S. private equity firm’s first investment in Israel’s tech sector.

Meanwhile, Addallom, a U.S.-Israeli cyber-security startup, is close to raising at least $25 million, TheMarker has learned. The round, which is being led by the U.S. data-storage company EMC, values Addalom at more than $100 million.

A third company, the U.S.-Israeli startup Kaminario, said on Wednesday that it has raised another $15 million, just a month after securing $53 million from investors in a funding round.

The three big rounds, plus two much smaller ones, come on the heels of a wave of fundraising last week that saw 10 companies raise a combined $140 million. Five of the rounds were in excess of $15 million.

The big funding rounds in Israel come as startups in the United States and Europe are also raising huge amount of cash, most notably the ride-sharing service Uber, which has taken in $40 million. Observers say demand to invest in startups has grown as nontraditional investors, such as hedge funds and private equity funds like KKR, look for ways to invest money at a time when interest rates are close to zero.

The Ramat Gan-based ClickTale said it would use the funds to expand globally, build its North American presence and to accelerate development of its customer analytics technology.

KKR joins existing investors Amadeus Capital Partners, a U.K. venture capital firm, Goldrock Capital and Viola Credit. The company, whose customers include Home Depot, Adobe and Walmart, has raised $53 million since it was founded in 2006.

ClickTale CEO Tal Schwartz said he expected the company to maintain an annual sales growth rate of over 50% in the next few years as companies seek to improve their customers’ experience. Competitors to ClickTale include giants such as IBM, which bought customer-experience management firm Tealeaf.

Addalom’s financing round, which will be completed within a few weeks, may end up exceeding $25 million because investors are so keen to buy a stake in it.

Investors include the U.S. venture fund Sequoia, Index Ventures and Zohar Zisapel, a long-time Israeli tech entrepreneur.

The round follows one for $15 million a year ago. Since then, however, Addalom has quadrupled its workforce to 80, including 50 employees at the company’s Tel Aviv research and development center.

The proceeds from the latest round will be used to double the R&D staff and to open sales offices in Europe and the United States, which is the company’s main market at present.

Addalom’s innovation is to move network security for big organizations into the Internet cloud.The company was founded in 2012 by CEO Assaf Rappaport, Vice President for R&D Roy Reznik and Chief Technology Officer Ami Luttwak. All three men served in the famed 8200 intelligence unit of the Israel Defense Forces.

Kaminario, a maker of flash-storage technology, said it raised the extra cash in response to investor demand. The latest round brings the total raised by the Newton, Massachusetts-based company since it was founded in 2009 by CEO Dani Golan together with Ofir Dubovi and Moshe Selfin to $143 million and values the company at somewhere between $400 million and $500 million.

Silicon Valley Bank, Lazarus Hedge Fund and an unnamed publicly traded company led the previous round of funding.

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