Israel punches well above its weight on the world stage when it comes to tech startups. As I detailed back in October 2017, the DNA of the region lends itself to success, though it’s not without its own challenges.
Today, at OurCrowd‘s Global Investor Summit in Jerusalem, the organization revealed the extent of its effect on Israeli startups with the announcement that it has raised $650 million for 145 startup companies and 12 funds since its inception in 2013.
“We’re trying to change the brand of equity crowdfunding,” founder and CEO Jon Medved told me in an interview from the event. “This is not like Kickstarter or any other typical crowdfunding process. We are investing over and over again. People ask us if we’re really going to follow our bets like normal venture people, and we say a resounding ‘yes.’ We don’t have a fixed fund that limits us.”
Unlike Kickstarter or Indiegogo, where you invest in a project in return for gifts, merchandise, and other benefits, OurCrowd allows investors to take a stake in the company they’re backing. While there is nothing new about equity crowdfunding, the twist is that OurCrowd only allows accredited investors to take part.
The company forecasts that it will exceed $1 billion in managed assets during 2018.
“We’re proud of the fact that we’ve got to this $650 million mark, but that’s nothing,” Medved said. “We’ve been doubling the business every year, and if that continues for the next few years, we’ll be in excellent shape. We have 550 different VCs coming to our conference from 250 funds — we’re working closely with the VC community to bring in new money and open up a new asset class.”
What’s in the DNA of an OurCrowd-funded startup? And what does it take to be accepted into the program and gain access to crowdfunding?
“A great story,” Medved said. “It could be an outstanding business, but if it is completely unintelligible to a crowd, we’ll probably have to pass. It’s a shame, but that’s the nature of the beast. You’ll see probably a higher percentage of social impact investments because of that, but it comes down to the story. By the way, that’s great investment advice, in general.”
The equity crowdfunding platform now has over 25,000 registered investors from 112 countries. It has offices in 10 countries, having opened in three new locations in 2017 — London, Hong Kong, and Madrid. Notable investments in 2017 include Airobotics (autonomous drones for industry), BrainQ (AI for treating neuro-disorders), Arbe Robotics (vehicular radar systems), and Dreamed (artificial pancreas).