Israeli Startups Report Steep Decline in Early Stage Investments in March
So far in 2020, only 50 seed and series A rounds were raised, a decrease of more than 30% in the number of deals compared to the first quarter of 2019
Two weeks before the end of the first quarter of 2020, it is already clear that the Coronavirus pandemic (Covid-19) is taking a substantial toll on Israeli startups. According to new data published Thursday by IVC Research Center Ltd., a Tel Aviv-based research center focused on the Israeli tech industry. According to IVC's figures, so far in 2020 only 50 seed and series A rounds were raised, a decrease of more than 30% in the number of deals compared to the first quarter of 2019.
The effect of the pandemic is more evident when considering IVC’s data for March. So far this month, only two early-stage deals were raised, compared to 28 deals in March 2019.
New companies are encountering a serious obstacle because they cannot meet investors face-to-face today due to the pandemic, and investors may be hesitant to back companies they’ve only communicated with through Zoom, Yossi Vinitski, Bank Hapoalim's head of tech, said in a Thursday interview with Calcalist.
Tel Aviv's skyline. Photo: Shutterstock
Since coronavirus (Covid-19) hit Israel’s economy at the beginning of March, 330,000 Israelis registered for unemployment, 13-times the number of people who registered in February, which saw 26,000 people register, according to government data.