New York City home to 26 tech unicorns founded by Israelis — report
14 Israeli-founded companies based in Manhattan have achieved $1b valuation, US-Israel Business Alliance data shows since mid-2021; 9 listed publicly
Ricky Ben-David is The Times of Israel’s Tech Israel editor and reporter.
Following a record funding year in 2021 for Israeli tech companies, proceeded by a battering on Wall Street for those whose shares are traded publicly and a tumbling in tech valuations in recent months, New York is now home to 26 Israeli-founded unicorns — privately held companies valued at $1 billion or more — according to an annual report released Wednesday by the United States – Israel Business Alliance (USIBA).
Each of these companies’ global or US headquarters is based in Manhattan, making New York the city with the second most Israeli-founded unicorns in the world behind Tel Aviv, the organization said.
Since last year’s report, which tallied 21 Israeli-founded tech unicorns, 14 companies were added to the list, having reached a valuation of $1 billion or more, and nine companies listed their shares on the public markets (making them no longer private companies).
One of the reasons New York is such a top tech hub for Israeli entrepreneurs, suggested USIBA president Aaron Kaplowitz, is because the metropolis “supplies strategic resources that no single city can truly match,” offering “access to seemingly endless sources of capital, a well-traveled path to the rest of the America and global markets, a highly sophisticated workforce, cultural synergies – the list goes on.”
Given the travel disruptions brought on by the COVID-19 pandemic for two years, followed by other world events, the New York area “is the only place in the country with two airports that offer direct flights daily to Tel Aviv, so from the perspective of the executive who needs to travel back and forth frequently, New York has even more appeal,” he added.
Kaplowitz noted that since 2018, when the organization released its inaugural tally of Israeli tech unicorns based in New York, the list has grown tremendously.
In 2018, “New York had five and we thought that was a tremendous number,” Kaplowitz said. “Now that we’re at 26 we’ve had to recalibrate our thinking on Israelis’ contributions to the local economy and all the jobs these massive companies are creating.”
Among the 14 new tech unicorns added since last year, half of them in the last quarter of 2021, were biotech startup Immunai, which taps single-cell biology and artificial intelligence to fuel discoveries of new therapeutics and accelerate drug development; mechanical diagnostics platform Augury; OpenWeb, a developer of online community engagement and content solutions for publishers, which recently nabbed an investment from The New York Times at a $1 billion valuation; robotics firm Fabric, which recently secured a $200 million investment from Singapore-based Temasek and Koch Disruptive Technologies; Israeli-founded hospitality startup Selina (in the midst of securing a SPAC merger after which it will no longer be a private company); Veho, a delivery logistics company founded by Israelis that recently relocated to New York from Boulder, Colorado following a funding round in December that valued it at $1 billion; and transcription from Verbit, which joined the unicorn club last June and has since doubled its valuation.
These companies join existing New York-based, Israeli tech unicorns including Via, Axonius, BigID, Forter, K Health, Melio, Papaya Global, Yotpo and Vast Data.
Previous tech unicorns founded by Israelis that have gone public since mid-2021 were Kaltura, Monday.com, Outbrain, Payoneer, Riskified, Similarweb, Taboola, Talkspace and WeWork.
Some of these companies listed their shares publicly at higher valuations that have since decreased, alongside global counterparts.
Analysts have warned of a correction in 2022, following an investment bonanza in 2021 where Israeli companies raised an astonishing $25 billion, shattering all previous records.
On the funding side, USIBA said New York-based venture capital firms Tiger Global Management and Insight Partners “proved to be among the most active investors in Israeli technology in 2021.”
According to Start-Up Nation Central finder database, Tiger Global participated in 16 funding rounds for Israeli companies (including Melio, Papaya Globa, and others) and Insight Partners invested in 49 firms last year.