Three Israeli Startups Raise a Combined $180m in Single Day

Compass leads pack with $100 million, with Yotpo secures $51m and Mitrassist $30m

Yotpo CEO Tomer Tagrin in Tel Aviv, March 23 2017
Ofer Vaknin

Three Israeli or Israel-founded startups announced fundraisers totaling more than $180 million on Wednesday.

Compass, whose hyperlocal information networks match buyers and renters to homes, said it had won a $100 million investment from a group led by Fidelity Investments, with previous investors Institutional Venture Partners and Wellington Management joining in.

The new round values Compass, which is based in New York City and was founded by Israeli Ori Allon, at $1.8 billion. The company has raised a total of $325 million since its founding four years ago, including $75 million in August 2016. Moreover, it expects to generate $350 million in revenues this year.

But the 37-year-old Allon, who owns the Hapoel Jerusalem basketball team and founded two startups previously, said the new funding was needed to accelerate growth.

“Every year we assess the market situation from a new with our investors – it’s important to keep our finger on the pulse,” he said. “The fundraising will enable us to double our investment in development and to expand our operations to all the leading markets in the United States.”

Compass’ search technology pairs people with homes that fit their needs, providing details to help them evaluate neighborhoods, and matches them with agents to complete a purchase. The company now employs 3,000 people and has plans to go global from its U.S. base.

Tel Aviv-based Yotpo, whose platform lets users of products and services generate their own marketing content, said Wednesday it had raised $51 million in new capital. Len Blavatnik’s Access Industries led the round, which includes earlier investors in the startup, and brings total funding since it was formed in 2011 to $101 million.

Unlike user-generated content that focuses on reviews or photos, Yotpo’s platform lets brands collect, curate, manage and respond to all kinds of user-generated content from a single platform. The content is free and in many cases viewers find it more authentic and reliable than professionally produced marketing material.

“We’re living in a post-Amazon world where even big, established brands are collapsing because it’s impossible to compete with Amazon on price or fulfillment,” said Yotpo Chief Executive Tomer Tagrin. “The only way commerce brands can win is through customer experience and building an authentic brand that people truly care about and talk about.”

Tagrin said Yotpo will have generated revenue in the tens of millions of dollars in 2017. Proceeds will be used to double research and development staff.

Meanwhile, Mitrassist, an Israeli startup that has developed a valve to help people suffering from mitral regurgitation, was expected to announce on Wednesday that it had raised $30 million from Chinese investors.

The pharmaceutical arm of Fosun will lead the round, joined by PingAn, China’s biggest insurance company. The round will be in two stages – the first for $16 million at an $80 million company valuation (before the money) now and the rest at a $136 million when Mitrassist’s device is successfully used on a human patient sometime in the next 14 months.

Some 250,000 new cases of mitral regurgitation are diagnosed each year in the United States alone. The startup’s valve implant is targeted for the approximately 50,000 sufferers who can’t undergo surgical treatment, potentially restricting their daily activities and even shortening their lives.

The Mitrassist valve is placed on top of the natural valve to work in unison with it. The company was founded in 2009 by Chief Executive Gil Naor.

Fosun Pharma has invested in Israeli companies before, buying Alma Lasers for $240 million in 2013 and cosmetics company Ahava for $80 million last year. And in 2015 it invested $25 million in Ornim Medical.