Jerusalem Global Ventures is preparing to launch JGV Growth Equity Fund, a USD200m tech-focused fund.
Jerusalem Global Ventures is preparing to launch JGV Growth Equity Fund, a USD200m tech-focused fund. The fund will invest in private Israeli-related technology companies that are on a trajectory to IPO within three years and have a proven business model.
First closing is scheduled for April 2008. Dr. Shlomo Kalish, who founded Jerusalem Global in 1994, notes that, "Unlike the early stage VC investment model, where one expects multiple write-offs for every ‘home run’, this fund’s business model should produce quicker turnaround of money, lower risk, and more predictable returns."
In 2007, Dr Kalish was the only Israeli in the Top 50 of the Forbes Midas list. Jerusalem Global currently manages two sector funds launched in 1999.When compared to peers of the same vintage, one of those funds is at the top in terms of both cash distribution and internal revenue return.
Dr Yoseph Linde, who co-manages the prior funds, says, "Over the last several years, in the course of making investments for our early-stage VC fund, we were offered numerous opportunities to invest in late-stage technology companies. Although we rejected most of these offers as they did not fit our primarily early stage focus, we did make two such investments resulting in two successful exits.’
‘Our portfolio company, Mellanox, which had a successful IPO earlier this year, would be a perfect example of companies we would fund."
The fund expects to invest USD5m-20m in companies which late-stage financing needs of USD10m-50m.
Dr Kalish says, "Think of this fund as a barbell. On one end we have foreign financial institutions that do not have staff on the ground in Israel but have expressed interest in co-investing with us. On the other end we have investment banks that would like to establish a strategic relationship in order to help prepare our portfolio companies for an IPO. The fund is the connecting rod in the middle, using the manager’s network and expertise to source and invest in quality deals."
Dr Kalish adds, "There are some interesting things going on in Israeli technology. The number of private companies with revenue of more than USD10m has exploded, and we see more in the pipeline. Yet, there is still pressure for such firms to exit too early. This fund will help successful companies bridge that gap and get to a point where they can realize their full value."
A number of investors in the prior fund have committed to this fund. In addition, Jerusalem Global will be marketing the fund to major financial institutions, fund of funds, university endowments, and pension funds.
Jerusalem Global Ventures Global began in 1994 and was soon recognized as the leading technology investment bank in Israel. It produced an internal revenue return to investors of 84 per cent, and underwrote some of the largest offerings in Israel, including Galileo and Creo. The earlier fund, mentioned above, was begun in 1999 and also had some notable exits, including Mellanox and Kashya.
Drs Kalish and Dr Yoseph Linde, senior investment professionals, have been together over nine years. Rounding out the investment team are Ranan Grobman,who has been with the firm for five years. Robbie Citron is the CFO, and Paul Lowenstein has joined the firm as director of investor relations.
