In an effort to promote the local high-tech sector and enhance its access to the Israeli capital market, senior ISA staff prepared a document at the request of the Chair of the ISA, which analyzes the Israeli high-tech industry. The document highlights (a) the segments that are expected to be future industry leaders in this industry; (b) the main players in the local capital market, including reference to the scope of their investments in local high-tech companies; (c) the capital sources currently available to Israeli high-tech companies seeking capital; and (d) the main obstacles preventing institutional investors’ greater involvement in the local high-tech sector. The document also reviews the various extant investment vehicles in other countries, and various steps that have been taken in the past and in the past year.
Thinking on potential solutions for promoting the local high-tech industry and enhancing its access to the Israeli capital market entails two main challenges:
One, why do many local technology companies choose to raise capital, mainly from foreign investors and not from Israeli investors, and whether the local capital market can be relevant for growing technology companies?
Two, why do local institutional investors have few or no investments in Israeli high-tech companies and/or in venture risk capital funds?
We invite the general public to send their comments on these questions of principle, potential solutions, and on the series of ideas mentioned in this document including:
· Is it important to expose the Israeli public to the success of the local High-tech industry?
· Should a secondary exchange or additional exchanges for local high-tech companies be established?
· Should incentives (including tax incentives) be given to investors in small and middle-sized high-tech companies?
· Should investment instruments such as those available in England, Australia, or Canada, be promoted in Israel, or should existing instruments be adjusted in view of the experience accumulated over time?
· Should we allow the operations of tradeable debt funds whose aim is to provide credit to high-tech companies in general, or high-tech companies in the sale stage?
· Would a public fund of funds should be established in Israel?
· What barriers should be removed in order to enhance the capital market’s access to the local high-tech industry?
We invite the public to express its opinion and comment on the contents of this document, until January 7th , 2019.
To view the report click here
Contacts: Eli Daniel, Adv; Avi Laor, Adv; Danielle Shimonov, Adv