TechNation: IAI Did $100 Million of Cybersecurity Business in 2016

Treasury plans law on peer-to-peer lending; Geektime report points to tech slowdown; InovyTec raises $3m from Chinese firm for emergency-medical devices.

A man types on a laptop computer in an arranged photograph taken in Tiskilwa, Illinois, U.S., on Thursday, Jan. 8, 2015.
Daniel Acker, Bloomberg

IAI did $100 million of cybersecurity business in 2016

Cybersecurity has emerged as an important new growth sector for state-owned Israel Aerospace Industries. IAI said Monday that sales of cybersecurity technology reached $100 million last year, as its board approved forming a unit inside its Elta subsidiary to manage the growing business. “We see cybersecurity as a strategic sector and growth engine for the company,” said CEO Yossi Weiss. “We expect the growth to continue over the next several years. Launching our new cyber unit will provide the foundation for further growth.” Esti Peshin, who was running cybersecurity operations at IAI, was named the new unit’s chief. IAI offers intelligence, defense, monitoring and identification technologies to cope with cyber threats, and operates research and development centers in Singapore and Switzerland, as well as in Israel. It leads the Israeli Cyber Companies Consortium, which also includes Check Point Software Technologies, Verint Systems and a host of startups offering customers end-to-end solutions. (Ora Coren)

Treasury plans law on peer-to-peer lending

Israel’s Finance Ministry released a draft version of a proposed law Monday that would encourage online peer-to-peer lending by creating a regulatory framework for it. The new law will also create protections for the people lending money through P2P websites, as well as for the borrowers – a move the treasury hopes will give the nascent industry more legitimacy and enable it to become a more serious competitor to the banks and credit card companies. P2P lenders already exist, such as eLoan, which is part-owned by the Meitav Dash investment house. To date, though, borrowers are in short supply. “Loans between people on the internet is a win-win model: higher rates of interest for the lender and lower rates for the borrowers [than they could get at a bank] via loans made quickly and without bureaucracy,” said Finance Minister Moshe Kahlon, who has been working to create more competition in the consumer-lending sector. The Capital Markets Authority will be responsible for enforcing the proposed regulations. (Assa Sasson)

Geektime report points to tech slowdown 

Record fundraising by Israeli startups last year belied an emerging downturn in the industry, which began in the second half, the high-tech website Geektime said in its annual report last week. “In the first half of 2016, it looked like Israel was on for a record year in startup funding, raising almost as much financing in the first half of 2016 ($2.32 billion) as in all of 2015 ($2.8 billion). But by the second half of 2016, it appears the Silicon Valley bubble burst that occurred in the fall of 2015 came to Israel’s sandy shores,” Geektime wrote. Fundraising slumped to $1.85 billion in the second half of 2016. Geektime said the cybersecurity sector showed signs of “maturity” and slowing momentum last year, with M&A activity down 82%, but it predicted that autonomous cars still had strong growth prospects over the next 4-5 years. (TheMarker Staff)

InovyTec raises $3m from Chinese firm for emergency-medical devices

Just two weeks after three Israeli biotech startups saw Chinese investors back out of deals, InovyTec said Sunday that a Chinese company had invested $3 million in it. The company is a maker of emergency-medical devices that can be used by nonprofessionals. The Hod Hasharon-based firm said it had sold a 15% stake to Vincent Medical, a medical-devices maker traded on the Hong Kong Stock Exchange. Vincent Medical is the second strategic investor the company has lined up in the past three months after Germany’s Rhön-Klinikum. In addition to providing capital to develop new products, the two investors will also help the company enter the Chinese and European markets. InovyTec’s products are designed to provide out-of-hospital, noninvasive emergency treatment; its LUBO device is used to open a patient’s airway. The device has been approved by the U.S. Food and Drug Administration. InovyTec was formed in 2012 and received seed funding from China’s Guangxi Wuzhou Pharmaceuticals. (Yoram Gabison)