BDO LLP | INTERNATIONAL TECH HUB
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INVESTMENT CAPITAL AND EQUITY All the big PE players from Europe and North America have a presence in Israel. If you have a good product or idea, you will be able to find a way to fund it. It’s still the case that Israeli companies tend to be under-valued compared to, say, the US. This can be a good advantage to investors because it’s often possible to find strong IP to invest in that you might have had to pay much more for elsewhere. Of course there is some nuance to the landscape, as with any unfamiliar terrain, but there are many strong sources of professional advice on hand to steer investors to the right fit for them. Investors are sometimes too easily put off Israel because of the perceived complexity or risk, but the presence of all the big payers looking to invest in the next big thing here shows that this is a market not to be overlooked. But the professional consulting firms are very adept at helping investors find their way through the market, and can save you a lot of time and effort in terms of research. Long before you consider taking the steps of establishing an operation on the ground, they can direct you to strong possible investments and opportunities that would not be easy to access otherwise. It’s just a question of finding the right partner. Most of the local investment resources come from angels and private equity. Over the last two decades there have been a significant number of exits, and entrepreneurs have channelled some of the significant money released by these into small funds that have provided seed capital and startup resources for a new generation of entrepreneurs. International investors have a strong presence in Israel too – especially the US, China, Indian and Japan. There is of course a natural affinity between Israel and Jewish investors, wherever they live in the world. Where non-Jewish investors may have concerns about the stability of the country because of negative media images, more knowledgeable investors are aware of Israel as a territory that offers great judicial, democratic and financial stability.
Israel was one of the countries least affected by the global financial crisis of 2008, for example. A lot of international investors choose to build businesses in the Israeli market, and a lot of international companies perform IPOs on the Israeli Stock Exchange, because there’s a strong sense that their money will be safe here. ISRAEL AS A PLACE TO LIVE AND WORK Newcomers to Israel are often surprised to discover a highly developed economy with all the amenities and resources of European and North American countries. The cost of living could not be described as cheap, but the education system is very strong, crime levels are low, the nightlife is vibrant – Tel Aviv is known as ‘the city that never sleeps’ – and of course the country’s historical and cultural heritage is richly fascinating.
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