Number of Israeli Gen AI startups more than doubles in six months
Number of Israeli Gen AI startups more than doubles in six months
The total amount raised by Israeli generative AI startups so far has reached $2.3 billion, a 2.5x increase compared to the total figure from April of this year
So much has happened in the generative AI space globally, and in Israel, since we published the previous version of the Israeli generative AI landscape, almost exactly five months ago. We’ve seen new foundational models, open source LLMs, and all sorts of new companies building the co-pilots for every category. The technology is advancing at a breathtaking pace and it’s enough to look at Hugging Face’s LLM leaderboard to understand that generative AI is much more than just ChatGPT. So far in 2023, generative AI startups have raised $16 billion, according to Dealroom.
In the past 5 months, the number of Israeli Gen AI-related startups in Israel has more than doubled from 67 to 144 companies, as seen in the current landscape below. The total amount raised by Israeli generative AI startups so far has reached $2.3 billion, a 2.5x increase compared to the total figure from April of this year (This is not all new funding, as it includes companies that were established prior but were not on the first landscape).
Israeli startups were largely ‘skipped over’ in the mega rounds that occurred in this space. The largest round so far in Israeli generative belongs to AI21 Labs, which recently raised a $155 million Series C. (Source: SNC, IVC, public data and Remagine Ventures’ data)
At Remagine Ventures, we’ve been interested in tools for content creation, distribution and monetization from day one. While we called it ‘Synthetic media’, or ‘Creative Automation’, we made our first generative AI investment in 2019, writing the first check for Hour One, the company building foundational models for text to video based on human and animated avatars. We’ve since invested in 6 more startups in the generative AI space, mainly at the intersection with entertainment and gaming. For example, Munch, providing automated vertical video clips from long form content, or KwaKwa, the latest product by Piggy, powering communities. Our most recent investment in June of this year was Playo, a company developing foundational models to power full game experiences created from a text prompt.
We believe that Israeli founders have the necessary ingredients to be successful in the generative AI space:
- Talent - The strength of AI and ML talent (coming from both Academia and tech military units such as 8200), has earned Israel a spot as one of the top 10 AI hubs globally.
- Multidisciplinarity - Israeli startups are applying generative AI on a great range of fields, from cybersecurity to health, gaming, etc., and founders aren’t afraid to disrupt old industries.
- Culture - Israeli founders benefit from a ‘lack of disregard to the impossible’, and are rooted in a culture of problem-solving, resilience, and adaptability.
While Gartner confirmed that generative AI has reached the peak of the hype cycle for emerging technologies, at Remagine Ventures we believe that LLMs and generative AI technologies are game changers that have the potential to change entire verticals and that large companies will be built in this space. We are excited to continue to be the first backers of Israeli founders re-inventing the future with generative AI and see exciting opportunities in vertical SaaS (co-pilots for specific industries), task oriented models, and tooling for low-code/no-code Gen AI-based applications.
Eze Vidra and Kevin Baxpehler are Managing Partners of Remagine Ventures and Amit Revivo is an Investment Analyst.
