The leading tech investments in Israel in 2020

M51 Editorial


Israel has always been known for its entrepreneurship and innovation, and 2020 perhaps best exemplified it. In the year full of uncertainties and constant slowdowns, the Israeli startup scene was nothing short of stellar in its dealings with the global crisis. 

Year after year, Israeli tech companies raised record amounts of funding, and last year was no exception. Israel’s tech scene flourished throughout the year, raising a record amount of capital ($10.2 billion) and proving once again that innovation flows in our veins despite all the pressure. In fact, it’s more likely because of it. 

2020 was also the year where 15 Israeli-founded companies achieved the unicorn status, providing yet another benchmark of success. Some of those added to the prestigious club were companies that raised the most capital, which we’ll focus on in this post. In total, the top 10 fundraising tech companies raised $2.44B – slightly under one-quarter of the total amount raised for 2020. Impressive, right?

So, without further ado, here are the top 10 fundraising tech companies for 2020:

  1. SentinelOne $467 million
  2. Via $400 million
  3. Snyk $350 million
  4. Next Insurance $250 million
  5. AppsFlyer $210 million
  6. Gong $200 million
  7. Tipalti $150 million
  8. BioCatch $145 million
  9. Bizaboo $138 million
  10. CATO Networks $130 million

Let’s get to know them a bit and delve into their fundraising successes.

1. SentinelOne – $467 million

The “only cybersecurity platform purpose-built for the remote workforce”, SentinelOne managed to rake up almost half a billion in funding in two takes. In February, it scooped $200 million, gaining back then the entry to the unicorn club with a valuation of $1 billion. In November, it managed to add $267 million to its funding efforts, ending up with the highest funding tally for any Israeli company and a $3.1 billion valuation – three times more compared to February. 

Generally speaking, cybersecurity was one of the biggest winners of 2020, along with fintech and IoT, where the country’s deep tech experience excelled once more. The pandemic gave this branch of industry a significant boost as more employees shifted to working from home. This created numerous opportunities for cybercriminals (it’s not like 2019 was a quiet year in that regard) but also for companies that fight them.

SentinelOne, the developer of an AI platform to secure endpoints such as laptops, servers, and IoT devices on an enterprise level, was just one of the companies that profited from an increasingly distributed workforce. In what is becoming a more complex online threat landscape by the day, companies that provide immediate solutions are in high demand right now, perhaps more than ever before. Endpoint security solutions could be worth as much as $18.4 billion by 2024 so it’s safe to assume the cybersecurity market will experience increased revenues in 2021, especially since the changes that took place in 2020 will likely stick around for the foreseeable future. 

2. Via – $400 million

An on-demand shuttle startup, Via hit it big in March when it totaled $400 million in a Series E funding round. It also earned the company a $2.25 billion valuation, despite the pandemic wreaking havoc on the global transportation industry.

What’s interesting here is that Via isn’t your classic, Uber-like ridesharing company as there are two sides to its business. Yes, there is the commercial shuttle service side in the US but most of Via’s business comes from its underlying technology which it sells to public transit agencies and other transportation authorities for their own shuttles. Thanks to the company’s software, these organizations are able to make transit more responsive to demand by implementing timely changes like more efficient booking, route changes, and all that jazz.

But demand proved to be an uphill battle with COVID-19 as consumer spending on ridesharing took a dive. Hence, we might see even more of Via’s transition to a SaaS company from a mobility one. Concerns about sharing rides will not subside so figuring out new ways to broaden its appeal and adapting will be very important. We predict Via will grow and make partnerships and acquisitions (something it already started last year) in 2021 in an effort to accommodate more flexible and varied consumer expectations.

3. Snyk – $350 million

As mentioned, 2020 was a busy year for online security and Snyk was another example in a long line of companies that capitalized on the accelerated shift to the cloud. The pandemic proved to be an accelerant to the cybersecurity space, as many companies made the move at a faster rate than initially expected. Such a scenario certainly worked in Snyk’s favor as the company started the year with a $150 million investment on a valuation of over $1 billion. It added another $200 million in September and upped its valuation to $2.6 billion, further cementing its recently acquired unicorn status.

What makes Snyk stand out in the field is its unique approach to security, incorporating it into the development process instead of securing a product after it’s built, as is usually the custom. In other words, the company targets developers as opposed to cybersecurity professionals, helping them identify and remedy flaws in their source code. As a result, risks are mitigated faster and easier.

With its mission to “modernize the security industry by empowering developers to integrate security into the complete software development lifecycle”, Snyk will continue to gain momentum as the digital transformation of projects accelerates in the wake of the looming coronavirus. Having an extra line of defense and a helping hand in prioritizing more serious flaws is a rather appealing proposition. More so, companies get to save time and resources on certain cybersecurity issues, which will likely further proliferate the DevSecOps movement.

4. Next Insurance – $250 million

In the world of insurtech, Next Insurance was a huge story. The company raised $250 million in a Series D round in September, effectively getting closer to its goal to become the go-to insurance provider for a broad spectrum of small businesses and the self-employed in the US. As a bonus of sorts, Next Insurance was valued at over $2 billion, more than doubling its valuation from 2019.

So how did a tech-driven insurance company manage to raise so much money?

The simple answer would be to say it made buying insurance easier and more personalized to business needs – but there’s more to it. For starters, it’s a huge, active market where IPOs of insurtech unicorns Lemonade and Root only sped up its development. Some estimates put the business insurance market in the US at $225.2 billion in 2021 so there’s plenty of money in play.

Perhaps more importantly – the market is up for grabs. Historically speaking, small business insurance has been at the mercy of large carriers that offered generic, one-size-fits-all solutions that failed to address the distinct requirements of micro and small businesses. By building its product from the ground up and modernizing it via machine learning and data science, Next Insurance is able to provide a more customized and affordable solution.

And if the unicorn company is to be believed, its tech-first approach reduces costs by up to 30% compared with traditional policies – so who wouldn’t want to invest?

5. AppsFlyer – $210 million

The mobile attribution company opened 2020 with a bang by securing $210 million in a Series D funding round at a $1.6 billion valuation, making it at the time the first and only unicorn in the attribution category.

As mobile attribution is slowly turning into one of the key elements of the marketing tech stack, it seems investors (led by General Atlantic, in this particular case) are recognizing the value of having an accurate measurement of mobile ad spending. In the US alone, it accounts for more than two-thirds of total digital ad spending and is expected to bounce back to pre-pandemic levels. 

AppsFlyer has expanded into other hot-topic areas such as fraud prevention, attribution across platforms, and marketing analytics, among others. The breadth of its offerings certainly played a role in raising the company’s appeal to investors. In fact, in November, AppsFlyer raised a new round of funding from Salesforce Ventures but didn’t disclose the funding amount so we’re sticking with the $210 million mark.

Considering the ongoing COVID-19 crises and Apple’s imminent IDFA changes in iOS 14 both hammering app developers and the mobile measurement industry at the same time, we’ll have to see if the same positive funding sentiment will carry on to 2021. So far, it looks like investors are willing to bet on companies they feel will end up being the resilient ones.

6. Cato Networks – $207 million

Cato Networks is a cybersecurity company that has developed a cloud platform called SASE – secure access service edge. It centralizes the management of security on a company-wide level across all of the networks and remote access points. 

Cato secured $130 million in an investment round in November, which earned it the unicorn status along with a hefty sum of cash. As you can imagine, the swift shift to remote working during the pandemic skyrocketed the demand for the company as businesses all of a sudden sought to provide remote access to everybody. By acting as a centralized hub through which all traffic goes, Cato helps quickly optimize and scale existing security systems.

The company previously raised a $77 million round in April, enjoying a steady growth for several years. Investors believe Cato’s SASE will transform the multi-billion-dollar markets for enterprise networking and security, one of the fastest developing sectors of the IT industry. When the idea is to provide safe customer access to networking resources and network security no matter where they are, it’s tough to argue against that sentiment. 

7. Gong – $200 million

The “AI revenue intelligence platform” raised $200 million in a Series D funding in August, bringing the company’s valuation to $2.2 billion. The investment came on the heels of a 2.5x revenue growth year-to-date in 2020 (according to the company reports), boosted by the shift toward working from home and the growing importance of remote selling.

Gong’s rising status in the sales software industry is attributed to its application of natural language processing in all the conversations held via email, phone call, and video call. It analyzes these conversations and provides insights and suggestions on which deals are about to close or at risk of being lost, how to improve closing a deal, and so on. So, the platform also shaves off significant clerical work away from salespeoples’ routines.

In the eyes of investors, AI-based sales enablement software company with a fast-growing and highly reputable clientele (PayPal, LinkedIn, Slack, and Shopify are just some of the big names) represents a calculated bet that Gong will benefit long-term from the new normal. And this new normal implies that people will be working and selling remotely, where the likes of Zoom will replace a lot of the field sales. 

The coronavirus unlocked a new stage in the evolution of work and sales, and Gong is superbly positioned to see it through. Plus, the baseline AI function of capturing words directly (as opposed to indirectly via a sales rep) has a potentially far broader application beyond CRM, something the company will likely explore in the near future.

8. BioCatch – $165 million

Back in April, the behavioral biometrics company BioCatch closed a $145 million Series C investment round. The company’s tech, used to monitor user behavior throughout every online session to determine if a user is real or a fraudster, includes some of the world’s largest global financial institutions as customers.

Arguably, the top tier client list is certainly one reason why BioCatch was able to attract such a hefty sum, added to it by the $20 million raised from four major global banks (Barclays, Citi, HSBC and National Australia Bank) in late September. The Covid-19 pandemic has acted as a catalyst for digitalization of banking services, which meant institutions like banks had to quickly scale and adopt digital transactions.

That’s only one reason why cybersecurity in the fintech space “profited” in 2020. More people using online banking opened more doors to fraud and illegal activity. The ability to identify fake accounts and/or stolen identities at the onboarding stage, as well as recognize and flag account takeovers and social engineering fraud (a cybercriminal posing as a representative of a trusted institution) – BioCatch’s core business – is super valuable. 

While regulatory bodies continue to fight financial fraud, they will have to deploy even smarter tech to fight online thievery. This is where biometrics steps in: to further secure online assets used to access an organization’s network. So, we can expect security and anti-fraud to remain among top fintech investment areas in the coming years, driven by customer expectation, regulation, and safeguarding reputation. 

9. Tipalti – $150 million

Dubbed the leading global payables automation solution, Tipalti raised $150 million at an over $2 billion valuation in October. The company’s USP is automating common payment tasks via a cloud-based end-to-end platform that provides all the requisite infrastructure and AI and machine learning usage to reduce risks and errors. In other words, it’s taking care of one of the most time-consuming and taxing functions in finance today which can hamper growth and scalability for fast-growing businesses.

The need to centralize apps was a staple in the ongoing digital transformation, particularly in the enterprise environment. However, the sudden increase in remote teams and a global economic crunch only accelerated the need to pay closer attention to where money is coming in and going out. Tipalti was there to capitalize on the unsexy but definitely necessary area of payments automation, and investors recognized it.

The company whose name aptly means “I’ll handle it” in Hebrew already saw a lot of business from various organizations that were scaling fast and looking for a solution that could integrate easily into their current systems. The pandemic amplified such a scenario with companies that needed to pay far more attention to how money is moving around than previously. This is a large total addressable market with massive growth potential and Tipalti’s valuation is a sign that there will be more of the same to come.

10. Bizzabo – $138 million

A late entry to the list, Bizzabo managed to raise $138 million in Series E funding in December. Coming from a new breed of hybrid events platforms where organisers create, manage and measure events online, offline, or some combination of the two, it’s clear Bizzabo is another company that got a significant uplift from the pandemic.

The events industry suffered huge setbacks in 2020 and many businesses were practically forced to adapt and adopt a digital way of doing things – events very much included. The pivot to a virtual format was met with extremely high engagement in some cases (Bizzabo says that the number of attendees registering for events with its platform was up 500% and overall usage was up 150x in 2020), enough to justify a widespread retention of these digital elements in a traditionally not-so-digital environment.

Bizzabo’s growth and momentum started pre-pandemic and went off the charts during it with the launch of the industry’s first end-to-end event technology solution. With a hybrid model in place that covers every stage of event planning and running, Bizzabo offered an attractive option both from a revenue and engagement perspective. From a sponsor perspective, it’s a potent mix of in-person networking that salespeople simply adore with a measurable set of digital KPIs that are easily available.

For the company, an added bonus was the fact that the virtual conference market was basically non-existent. Right now, bets are that COVID-19 has permanently transformed the professional events category.


With massive groups of workers and consumers turning to the good old Internet last year to interact, get things done, and entertain themselves, it created an equally massive blessing for some businesses but also cyber criminals.

As a result, it seems that the cybersecurity market particularly appealed to investors who recognized its growing importance during times of crisis. This wasn’t just the case with the Startup Nation – the global cybersecurity market outperformed 2020’s panic-stricken expectations.

However, investors have demonstrated a high level of enthusiasm when it comes to the growth of the country’s tech ecosystem, with no indicators that the enthusiasm will subside. 

Case in point: Rapyd’s recent 300 million mega funding deal, lifting its valuation to $2.5 billion which is more than double what it was worth previously. So, it’s a safe bet that sectors such as cybersecurity and fintech will remain extremely relevant as the digital transformation continues at a fast(er) pace. On top of that, emerging areas like AI are drawing up a lot of excitement, as usual.

Furthermore, Israeli startups once again showed their remarkable ability to adapt, especially in uncertain and volatile times of 2020. In fact, more than half of the startups changed their product due to COVID-19, while more than one-third pivoted their sales to the online world and 69% kept the same or increased their sales budget. That type of behavior won’t change any time soon.

There is a consensus that a lot of the changes brought about by the pandemic are here to stay, even when the outbreak comes to a stop. This will favor companies that “speak” to the COVID-era, which is everyone on the list above, for starters. Companies that focus on helping people continue their lives unaffected and those that aim to reduce the impact (if not erase it altogether) on the business side will be very much in demand. The remote capabilities of Israeli tech will play a crucial role in creating a long-term competitive advantage.

That’s where we see the biggest advantage of Israel’s tech scene and why we believe 2021 will top 2020 in capital raised.

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