Backed by Microsoft and Cisco, Israel’s Team8 raises $500m to help build startups
Venture group plans to use fresh funds for building and investing in 30 startups in the areas of cyber, data infrastructure, fintech, digital health and AI
Sharon Wrobel is a tech reporter for The Times of Israel.
Israel’s Team8, a venture capital group that develops and spins out tech companies, has raised $500 million for new funds that will invest in about 30 cyber, data infrastructure, fintech, digital health and artificial intelligence (AI) startups.
The new funds bring Team8’s total assets under management to well over $1 billion, the venture group said on Tuesday.
Out of the fresh capital, $235 million was raised for Team8’s second venture capital fund, which invests in seed and Series A rounds of startups. Another $110 million was raised for its third venture creation enterprise fund, in which Team8 collaborates with serial founders to jointly build and invest in 1 to 2 new startups a year in the fields of cyber, data infrastructure and AI.
An additional $70 million was raised for the launch of a new digital health fund, which strives to partner with entrepreneurs to invest in seed financing rounds of 1 to 2 new startups a year.
Nadav Zafrir, a former commander of the Israeli army’s tech and intelligence Unit 8200, founded the Team8 venture group in 2014 with 8200 veterans Israel Grimberg and Liran Grinberg. Its investors include Walmart, Microsoft, Cisco, Temasek and Moody’s.
The fundraising comes as Israel is almost five months into a war with the Hamas terror group and many local startups are struggling to attract essential funding. That’s after local political uncertainty around the government-led judicial overhaul at the start of 2023 pushed foreign investors into a wait-and-see position about deal-making and led to a sharp slowdown in investments.
“Team8 is an integral part of the Israeli ecosystem, and the new funds we are announcing today are a positive sign for the industry and our country as a whole,” Team8 Managing Partner Yuval Shachar told The Times of Israel in emailed comments. “Israeli high-tech innovators are as resilient and driven as ever.”
“We know that this $500 million investment shows that savvy global investors know that as well,” Shachar added.
Over the past decade, Team8’s activity has spurred the development of 20 companies, and investments in 21 others, including Sygnia, Claroty, Illusive Networks and Hysolate.
The Tel Aviv-based venture group typically invests $5 to $10 million in each startup, and has so far achieved eight exits, including the sale of Talon Cyber Security and Israeli startup Dig Security to Palo Alto Networks for a combined $1 billion.
