Andreessen Horowitz was absent from Israel for many years, as the venture capital firm preferred investments closer to home in the US. It was one of the largest investors in Facebook and in companies like Airbnb, Twitter, Stripe, Roblox, Coinbase and Lyft.
Cofounder Marc Andreessen is one of the biggest influencers in Silicon Valley, who famously said "software is eating the world." Now, according to the IVC-Gornitzky-KPMG-Israel Innovation Authority investors report for 2024, Andreessen Horowitz has become one of the most active foreign investors in Israel.
The report found that Andreessen Horowitz, which manages $45 billion, according to PitchBook, invested in seven new Israeli companies in 2024. A new investment in a company generally constitutes a long-term commitment to continue investing in additional rounds, and therefore the activity of an investment fund is measured by the rate of investments in new companies rather than follow-up investments in past portfolio companies.
Overall Andreessen Horowitz was one of the most active foreign venture capital investor in Israel after two Israel-oriented funds: NFX, whose partners include Gigi Levy-Weiss, Sarai Bronfeld, Omri Drory and US partners, which invested in nine new companies in Israel; and Ibex Fund, which invested in eight new companies but underwent a major upheaval towards the end of the year when most of the Israeli investment team left. In 2023, the report placed Andreessen Horowitz even lower with only four new investments in Israel. Despite the entry of new partners in funds such as Sequoia and Greylock in Israel, the funds did not significantly increase the pace of their new investments in Israel.
The major foreign funds that were active in Israel last year other than Andreessen Horowitz were Lightspeed Venture Partners with six new investments; and Insight Partners, Index Ventures and Bessemer Venture Partners with five new investments each.
Looking at the table of the most active investors in Israel, relatively small funds that make many small investments in a large number of companies – such as OurCrowd, Fusion and Iron Nation, are the most active investors in terms of new investments, followed by eHealth of Maccabi Health Fund and Amgen with 11 investments; NFX funds of Gigi Levy-Weiss and Jibe Ventures of Assaf Jacobi with nine investments each; Grove Ventures, On Ventures, Reichman and Ibex with eight investments each, and finally: AnD Ventures, Entree Capital, Andreessen Horowitz, Samsung Next, Tachles Fund, and Fresh Fund with seven investments each.
RELATED ARTICLES
Lowest point for over a decade
In summary, despite changes in the investment patterns of foreign funds, the data on the capital available for venture capital investments in startups is worrying. The volume of capital raised by Israeli venture capital funds reached a more than decade-low, with a total of $1.15 billion raised in 2024 for funds located in Israel – with most of the money raised by Vintage ($200 million), Red Dot ($200 million), V-Games ($142 million), Angular ($125 million) and Picture Capital ($110 million).
For comparison, in each of the years between 2017 and 2022, the volume of capital raised by Israeli funds exceeded $2 billion. Even a decade ago, in 2015, the amount was $1.662 billion. The performance of Israeli funds, which has been largely tepid in recent years, the lead taken by foreign funds, rising interest rates and the opportunities for more Israeli institutions to invest in foreign funds have led to the depletion of the resources of Israeli venture capital partners. According to the report, Israeli institutional investors allocated only $82 million and participated in 29 deals in all of 2024, a paltry sum, compared with $187 million in 44 deals in 2023.
Published by Globes, Israel business news – en.globes.co.il – on March 3, 2025.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.
