Weekly #FIRGUN Newsletter

It's #Firgun time.

The word "Firgun" (Hebrew: ??????/ pronounced 'feer-goon')?is an informal modern Hebrew term and concept in Israeli culture (originally Yiddish), which describes genuine, unselfish delight or pride in the accomplishment of the other person. It's the opposite of "schadenfreude". Firgun is all about genuinely feeling and expressing happiness, pride, or admiration for someone else's accomplishments, good fortune, or well-being. More about Firgun and why it matters on VC Cafe: https://lnkd.in/dg2a86p

433 days since Oct 7 2023. The talks about a potential deal are intensifying, providing the families of Israelis taken from their homes with cautious optimism and hope. Hanukkah is the time for miracles ,after all. We must not forget them and we need to #BRINGTHEMHOME now.

I was having lunch with a senior investor in London, who asked me: how long until business in Israel returns to normal? The answer is: it already has. Israeli exits are up 78% (!) from 2023, reaching $13.4 billion, according to a new report by PWC Israel. Funding for startups is also up 35% in the first 9 months of 2024 compared to the equivalent period in 2023, pre-war. Israeli Cybersecurity startups raised over $4 billion in 2024 led by Wiz and Cyera , and AI accounted to over 30% of all investments. Finally, the Israeli stock market outperforms global peers despite war, surging 27% in 2024. 苹果 's first AI server chip to be engineered in Israel and 亚马逊 ’s supercomputer and server technology is powered by Israeli Annapurna Labs , which was acquired in 2016. The trend of investment and Israeli innovation is likely to strengthen in 2025. It's time to build and I'm excited to play a small role with Remagine Ventures .

In the wider tech world, 谷歌 has released a new quantum chip called Willow, Willow performed a standard benchmark computation in under five minutes that would take one of today’s fastest supercomputers 10 septillion (that is, 1025) years — a number that vastly exceeds the age of the Universe. Willow also ‘indicates that multiple universes exist’... we live in truly incredible times. Google also announced Gemini 2.0, its most powerful model yet with advances in multimodality and the ability to analyze (and 'see') video in real time. The search giant also launched project Mariner, AI agents that can use the web for you (similar to Anthropic's computer use mode).

OpenAI continued with their 12 days of announcements - they've launched Sora, their much anticipated AI video generator (not yet available in the UK or EU) and also ChatGPT Vision, where paying users can point their phones at objects and have ChatGPT will respond in near real time. xAI launched a new image generator called Aurora and made Grok available to all X users. Meta launched LLaMa 3.3 and the ability to watermark AI generated videos. Stability AI is debt free and growing again. Midjourney launched Patchwork, a virtual world building tool. Devin, the AI coding Agent by Cognition is now generally available. ServiceTitan went public with a $9 billion valuation - is the IPO window opening?

QUOTE OF THE WEEK

I meet Israeli entrepreneurs every day and continue to be astounded at the level of innovation and quality of startups this tiny nation produces. Every major investor who knows the industry will tell you the same thing: Israeli high tech is primed for continued growth and innovation, and remains the envy of every other nation.

Adam Fisher , Bessemer Venture Partners

NEW FUNDING ROUNDS

• Congratulations Gal Moav and team Evinced on your $55M series C to provide accessibility tools to software developers!
• Way to go Alon Jackson and team Astrix Security on your $45M series B to provide visibility into all non-human identities and prevent supply chain attacks!
• Well done Nadav Keyson and team Riverside.fm on your $30M series C to enable media companies and content creators to record high-quality audio and video content directly from their browsers!
• Great stuff Dor Sasson and team Stigg on your $17.5M series A to build the first unified monetisation platform to help SaaS startups get better at dynamic pricing!
• Mazel tov Israel Krush and team Hyro on the $15M series B extension to tackle healthcare’s AI needs!
• Kol hakavod Alan Bekker, PhD and team eSelf AI for coming out of stealth with a $4.5M seed round to build live, interactive AI assistants!
• Thumbs up Michal Beressi Golomb and team Celleste Bio on raising a $4.5M seed round to produce natural cocoa ingredients by cultivating cocoa cells in controlled environments!

EXITS

• Congrats Yoram Salinger and team Perception Point on the $100M acquisition by Fortinet to boost AI security and email and SaaS apps!

NEW FUNDS

• Well done Lital Leshem and Lee Moser and team Protego Ventures on the launch of a new $70M defence tech fund focused on Israeli startups!

LINKS FOR YOUR BROWSER

ISRAEL

1. Israel's tech paradox - by The Times of Israel
2. Israeli company Odysight.ai, a leader in AI-powered video sensor solutions, has been selected by NASA to integrate its cutting-edge visualisation systems into future aerospace vehicles.
3. On the worrying rise in Antisemitism in Canada and Australia

Bonus: please check out Next October - a moving initiative by former tech minister and experienced investor Izhar Shay who sadly lost his son Yaron on October 7th and is now looking to honour ALL the Israeli victims of this war by pairing them with a startup. Truly inspiring. https://www.nextoctober.org/

GLOBAL

1. On SuperAgency and AI adoption going forward - based on a talk that Reid Hoffman gave in London this week and his new book on AI agents - by me on VC Cafe
2. AI in 2025: Building Blocks Firmly in Place by Sequoia Capital
3. How AI is fuelling innovation in financial services - by Insight Partners

MEDIA OF THE WEEK

According to Yaron Weizenbluth , Hi-Tech Partner and Assurance Leader at PwC Israel , 2024 appears to be the best year for mergers and acquisitions in the last decade. (source)

Sacra estimates that Wiz hit $500M annual recurring revenue (ARR) in July 2024, up 103% YoY. After declining a $23B acquisition offer from Google and repositioning its product to directly go after Snyk, Palo Alto Networks and CrowdStrike, Wiz is now projecting it will cross $1B ARR before going public in 2025.

114 companies created 43% of all exit value for VCs in the last decade. We looked at ~5600 exits (IPOs and acquisitions) over the last decade in the US, Europe, Australia, and Israel. Of those 5600 exits, only 79 (1.4%) of these companies exited for $5B+, and if you look across the top 1% of exits each year, that includes another 35 companies. (source: Felicis )

Europe’s top 50 SME Vertical SaaS scale-ups according to Eight Roads (source)

The Prosumer top 50 startups, according to German VC fund Headline includes 3 Israeli startups! Kudos Sequence , Guidde , timeOS (source)

Here's a shocking stat about the concentration of capital in venture capital: 74% of capital raised in 2024 went to just 30 VC firms

Companies leading in digital and AI outperform financially from 麦肯锡 , 2024 the year in charts

The LLM model war is a much closer race now (source) OpenAI Anthropic 谷歌 亚马逊 Meta Mistral AI Perplexity

130+ AI Agents that are Y-Combinator backed (by Michael Tefula , source)

87% of the Fall 2024 batch are AI startups—with 83 of 95 companies explicitly mentioning "AI" in their name, tagline, or description. Been tracking this AI trend for YC batches over the past two years: - 77% in Summer 2024 - 70% in Winter 2024 - 57% in Summer 2023 - 32% in Winter 2023 (source)

How AI is Shaping the Future of Design and Optimization by Hitachi Ventures Partech and DTCP

Andreessen Horowitz big ideas for tech in 2025 (source)

Check out this conversation between Michael Eisenberg and Adam Fisher

That's all for this week. There's a lot to celebrate in our "small" community! Keep on creating!

Eze Vidra

#tech #israel #startups #venturecapital #founders

#innovation