Israel Seed Partners closes fourth fund: $200M

From Israel Seed Partners

April 4, 2000
New fund is 5 times larger than last fund which closed in March 1999; includes some of the world's leading companies, financial institutions and entrepreneurs.

Lead investor is Horsley Bridge: backer of leading venture funds such as Benchmark, Oak, and Mayfield.

Major New Investors also include IBM, America Online, Inc., UBS Capital, MIT, AXA, and Broadview together with prior investors DeutscheBank, Silicon Valley Bank, Flag, and the founders of Yahoo, Ebay, and Netscape. Israel Seed Partners today announced the closing of Israel Seed IV, the largest fund in Israel focused on seed money investing in early stage Internet and communications companies. Capital raised was $200,000,000, which is five times the size of the $40M Israel Seed III which closed just one year ago in March 1999, and which is now invested in 16 portfolio companies. This brings the total number of Israel Seed portfolio investments to 34, and funds under management to $258,000,000 in the four funds.

New Strategic Investors
Investors in this fund include a mix of strategic partners, leading financial institutions, and Internet entrepreneurs. Corporate investors IBM and America Online, Inc. are new investors with Israel Seed. Jon Medved, partner at Israel Seed, stated that, "We are delighted that IBM, one of the world's leading technology companies, and America Online, the world's leading interactive services company, have chosen to invest in seed money for Israeli start-ups. Seed investing is the highest risk, highest reward venture capital activity and we believe that our relationship with IBM and America Online will provide enormous strategic value to our companies." "Israel Seed IV has proven to be a great scout of Internet talent with companies like DealTime, Earthnoise, and GuruNet, and we look forward to working with them in the future," said Len Leader, President of AOL Investments. David Chaffetz, Business Development Executive at IBM, said "our focus on Business-to-Business and Internet infrastructure is right in sync with Israel Seed's investments. Israel Seed is focused on building the next generation of e-Business".

New Lead Investor
Horsley Bridge, the lead investor in Israel Seed IV, is a San Francisco and London based fund-of-funds, who backs the world's leading Venture Capital funds. It has invested in Benchmark, Oak, Mayfield, IdeaLab, TA Associates, IVP, Brentwood, Redpoint, Matrix, and other leading venture funds. Guy Fraser-Sampson, Managing Director at Horsley Bridge said: " We have watched how Israel Seed have rapidly built their operation over the last several years and we are proud to be their lead investor because we are bullish on their future growth and that of the Israeli technology market."

Leading financial Institutions
Some of the world's largest financial institutions have also joined the funding of Israel Seed IV including: UBS (Union Bank of Switzerland) Capital, DeutscheBank , AXA, Invesco, Silicon Valley Bank, Flag, etc. According to Neil Cohen, partner at Israel Seed, "the fact that we have such a fine group of "world class" financial institutions provides us with an expanded network of high level contacts and relevant investment experience which is invaluable."

Focus Remains on the Internet
Israel Seed plans to continue its focus on Internet Investments. Some of the world's leading Internet entrepreneurs have funded Israel Seed IV, including Jerry Yang, the founder of Yahoo!, Pierre Omidyar, the founder of Ebay, and Marc Andreesen, the founder of Netscape. Michael Eisenberg, partner at Israel Seed, stated, "we are pleased to have Jerry, Marc and Pierre return as investors in Israel Seed IV. We have worked hard to emerge as a leading Internet-oriented fund in Israel and will continue to seek out the best ideas and entrepreneurs who are working to build out the next generation of great Israeli Internet companies. We are convinced that there are many more companies out there like Tradeum where we can go from seed funding to a major exit in Internet time". Several founders and managers from Israel Seed internet portfolio companies such as DealTime and XaCCT are also investing in Israel Seed IV.

Providing more than just money
With its expanded arsenal of funds, Israel Seed will continue to provide very early stage seed funding and work closely with its companies, utilizing its growing Investment team, which now numbers 15 people. Alan Feld, who recently joined Israel Seed as its newest partner from Vertex, explained: "In today's market money is fast becoming a commodity. At Israel Seed we focus on providing much more than just money- we provide real assistance to our companies in the critical areas of strategy, team building, high-level marketing, and finance. Each of the Israel Seed partners are on the road with our companies in the US about once a month."

About Israel Seed Partners
Israel Seed Partners manages four funds focused on early stage investing in Israeli technology companies. Founded in a Jerusalem garage in May 1995 with $2M in capital, it has grown rapidly to be one of Israel's leading venture capital organizations with $258M in capital under management in four funds. The Partners include Jon Medved, Neil Cohen, Michael Eisenberg and Alan Feld. Investment focus is on the Internet: business-to business, ecommerce, infrastructure and broadband communications. Current portfolio companies number 34 and include leading Israeli technology companies: Tradeum (sold to VerticalNet), DealTime( in Nasdaq registration), XaCCT (in Nasdaq registration), Compugen, Mercado, NewChannel, Business Layers, Chiaro, Lynx Networks, One Path Networks (formerly Foxcom), Alchemedia, Earthnoise, GuruNet, Banter, and Foxcom Wireless. More information is available at the website: www.israelseed.com.

Back to list of news