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					                     The VC Industry in Israel:
An Empirical Analysis of Economic Potential



                                    October 2010
                                  Analysis of Data Included in Notes

E.G.P Applied Economics Ltd. Research and Consulting in Economics, Marketing and Social Sciences.
        48 Menachem Begin Rd., Tel-Aviv 66184, Phone: 972-3-6375000, Fax: 972-3-6390001
                                     Table of Contents
 Chap. 1 VC Investments – A Worldwide Comparative Analysis:
     Diversification & Specialization
     Maturity of Markets
     Evolution Process – From Initial Investment
     Exits – M&As or IPOs

 Chap. 2 Human and Intellectual Resources in Israel:
     R&D Personnel - International Comparison
     Entrepreneurial Activity
     Patents – International Comparison

 Chap. 3 International Recognition:
     High-Tech Related Multinational Corporate Presence in Israel

 Chap. 4 The Contribution of Israeli VC Firms to the Hi-Tech Sector and the Israeli Economy:
     Hi-Tech Contribution
     Israeli VC As Anchor
     Israeli VC Funds – Activity by Investment Levels
     Israeli VC in Exits - IPOs and M&As.
     VC Backed Employment
     The Impact of VC Investments on the Business Sector


                                                                                                2
           The VC Industry in Israel:
  An Empirical Analysis of Economic Potential




VC Investments Worldwide:
  Comparative Analysis



                                                3
                                Diversification & Specialization
                         VC Investments by Industry – 2008, US & Israel




US Total VC Investments $28.3 Billion                     Israel Total VC Investments $1.4 Billion
               Zoom in                                                              Zoom in


                                                            Source: PricewaterhouseCoopers’ Money Tree Reports


                                                                                                          4
                          Maturity
       VC Investments by Company Development Stage
                         US, Israel




 $b
Year



                                   Source: PricewaterhouseCoopers’ Money Tree Reports


                                                                                        5
             Maturity
VC Median Investment Round Size –
        US ,Israel ,Europe




                                Source: Dow Jones VentureSource (E&Y)


                                                                        6
                                        Evolution
            Current Status of VC Backed Companies by Year of Initial Financing
                                    US, Israel, Europe




Companies

     Year



                                                                Source: Dow Jones VentureSource (E&Y)
                                                                                                        7
                                             Evolution
                 Current Status of VC Investments ($m) by Year of Initial Financing
                                         US, Europe, Israel




Investments $m

         Year




                                                                     Source: Dow Jones VentureSource (E&Y)   8
               Exits – by M&A
M&A Transactions (Numbers) - US, Europe, Israel




                                            Source: Dow Jones VentureSource (E&Y)


  To Number Of Companies Initially Funded   To M&As Normalized
                                                                                    9
           Exits – by M&A
Median Time To M&A - US, Europe, Israel




                                Source: Dow Jones VentureSource (E&Y)


                                                                        10
                 Exits – by M&A
Median Equity Raised Pre-Exit - US, Europe, Israel




                                    Source: Dow Jones VentureSource (E&Y)


                                                                            11
          Exits – by M&A
Median Amount Paid - US, Europe, Israel




                               Source: Dow Jones VentureSource (E&Y)


                                                                       12
                            Exits – by M&A
         Median M&A Exit Ratios - US, Europe, Israel
Exit Ratio Equals the M&A Amount Paid Divided by Total VC Invested Prior to Exit




                                                             Source: Dow Jones VentureSource (E&Y)


                                                                                                     13
                Exits - by IPO
IPO Transactions (Numbers) - US, Europe, Israel




                                           Source: Dow Jones VentureSource (E&Y)


 To Number Of Companies Initially Funded   To IPOs Normalized
                                                                                   14
             Exits by IPO
Median Time To IPO - US, Europe, Israel




                               Source: Dow Jones VentureSource (E&Y)


                                                                       15
                    Exits by IPO
IPOs Median Equity Raised Pre-Exit - US, Europe, Israel




                                      Source: Dow Jones VentureSource (E&Y)


                                                                              16
                 Exits by IPO
Median Pre-Money Valuations - US, Europe, Israel




                                  Source: Dow Jones VentureSource (E&Y)


                                                                          17
                                 Exits by IPO
            Median IPO Exit Ratios - US, Europe, Israel
Exit Ratio Equals the IPO Pre-Money Valuation Divided by Total VC Invested Prior to Exit




                                                                     Source: Dow Jones VentureSource (E&Y)


                                                                                                             18
                                 The VC Industry in Israel:
                        An Empirical Analysis of Economic Potential




      Human & Intellectual Resources
   R&D Personnel - International Comparison


Definitions:
Europe: Denmark ,Finland ,France ,Germany ,Italy ,Netherlands ,Norway ,Spain ,Sweden.
Asia: Japan ,Korea ,Singapore.
Some missing data points were estimated as the average of prior and successive data points .



                                                                                               19
          Human & Intellectual Resources
R&D Personnel Per Million Capita – Israel, Europe, Asia




                                                          Source: OECD


                                                                         20
                                                Human & Intellectual Resources
                                                  Entrepreneurship in Israel




                     Entrepreneurs in Total 8,110                                            Founding Involvements 10,125



Source: IVC. Includes data as f ar as the 1950s but the mass of the data is f rom 1999 onwards up to March 2009.
Founders (entrepreneurs) include Israeli and Non-Israeli f ounders of Israeli and Israel-related high-tech companies.
VC Backed companies include companies that received f unding f rom an Israeli or f oreign VC f und(s).

                                                                                                                            21
                                               Human & Intellectual Resources
                                                  Entrepreneurship in Israel
                                 Number of Companies Founded - VC Backed and Non-VC Backed




            Total



Source: IVC. Includes data as f ar as the 1950s but the mass of the data is f rom 1999 onwards up to March 2009.
Founders (entrepreneurs) include Israeli and Non-Israeli f ounders of Israeli and Israel-related high-tech companies.
VC Backed companies include companies that received f unding f rom an Israeli or f oreign VC f und(s).

                                                                                                                        22
                                                Human & Intellectual Resources
                        Entrepreneurship in Israel- Number of Companies Founded & Company Status –
                                                 VC Backed and Non-VC Backed




             Total




Source: IVC. Includes data as f ar as the 1950s but the mass of the data is f rom 1999 onwards up to March 2009.
Founders (entrepreneurs) include Israeli and Non-Israeli f ounders of Israeli and Israel-related high-tech companies.
VC Backed companies include companies that received f unding f rom an Israeli or f oreign VC f und(s).

                                                                                                                        23
                                    The VC Industry in Israel:
                           An Empirical Analysis of Economic Potential




                Human & Intellectual Resources
                Patents – International Comparison



Definitions:
Europe: Denmark ,Finland ,France ,Germany ,Ireland ,Italy ,Netherlands ,Norway ,Spain ,Sweden ,Switzerland ,UK.
Asia: Japan ,South Korea ,Singapore .


                                                                                                                  24
       Human & Intellectual Resources
Patent Applications Per Million Capita - USPTO




                                                 Source: USPTO


                                                                 25
     Human & Intellectual Resources
Patents Granted Per Million Capita- USPTO




                                            Source: USPTO


                                                            26
                     The VC Industry in Israel:
            An Empirical Analysis of Economic Potential




                International Recognition
High-Tech Related Multinational Corporate Presence in Israel




                                                               27
                           International Recognition
        Corporate Investments in VC Backed Companies Prior to M&A
        Divided by Number of Companies Initially Funded in Same Year
                By Type of Corporate Entity, US, Israel, Europe




Total
Year




                                                                   Source: Dow Jones VentureSource


                                                                                                     28
                            International Recognition
         Corporate Investments in VC Backed Companies Prior to M&A
        Divided by Number of Companies Initially Funded in Same Year -
                 By Investor Country/Region, US, Israel, Europe




Total
Year




                                                                    Source: Dow Jones VentureSource


                                                                                                      29
                            International Recognition
Employment in Foreign R&D Units as a Share of Total Employment in R&D Companies -
        Israel and Selected European Countries, Selected Available Years




                                                                        Source: OECD


                                                                                       30
                                  International Recognition
                            Foreign R&D Units in Israel By Sector




Source: IVC Yearbook 2008


                                                                    31
                  The VC Industry in Israel:
         An Empirical Analysis of Economic Potential




     The Contribution of Israeli VC Firms
to the Hi-Tech Sector and the Israeli Economy




                                                       32
                               The VC Industry in Israel:
                      An Empirical Analysis of Economic Potential

              The Israeli Hi-Tech Contribution to the Economy

 This chapter is based on macro economic data from the Israeli CBS.

 Hi-Tech has been defined as precisely as possible:
      Manufacturing branches defined as highly technological by the OECD
       and CBS ;
      Service branches characterized by high levels of R&D activity.


 This classification has not been broadly used before in Israel
  because of data availability constraints;
   We believe that it’s adoption here is of high value to the analysis and the lessons to be drawn from it.




                                                                                                               33
                          Hi-Tech Contribution
          Share of Hi-Tech in Business Sector GDP, 1995 – 2007




Hi-Tech

  Year


                                                            Source: CBS


                                                                          34
                           Hi-Tech Contribution
      Share of Hi-Tech in Business Sector Employment, 1995 – 2007




Hi-Tech

  Year

                                                           Source: CBS


                                                                         35
                               Hi-Tech Contribution
          Share of Hi-Tech in Business Sector Wage Compensation, 1995 – 2007




Hi-Tech

  Year


                                                                     Source: CBS


                                                                                   36
                           Hi-Tech Contribution
      Share of Hi-Tech in Exports of Goods and Services, 1995 – 2007




Hi-Tech

  Year


                                                             Source: CBS


                                                                           37
                       Hi-Tech Contribution
Average Monthly Wage per Worker in High-Tech and the Business Sector
                           1995 – 2008




                                                 Source: CBS, US Bureau of Labor Statistics


                                                                                              38
                  Israeli VC as Anchor
        Investments in Israeli Hi-Tech Companies -




Total

Year


                                                     Source: IVC


                                                                   39
                   Israeli VC as a anchor
        VC Investments in Israeli Hi-Tech Companies -
        Share of Rounds with Israeli VC Participation




Total

Year


                                                        Source: IVC


                                                                      40
        VC Investments in Israeli Hi-Tech Companies -
                  By Development Stage




Total

Year


                                                        Source: IVC


                                                                      41
           Israeli VC as a anchor
VC Investments in Israeli Hi-Tech Companies -
         Israeli VC Share by Stage

                    Time Average




                                                Source: IVC


                                                              42
                          Israeli VC Funds
        Activity of Israeli VC Funds by Investment Level -
                         Number of Funds




Total

Year


                                                             Source: IVC


                                                                           43
                          Israeli VC Funds
        Activity of Israeli VC Funds by Investment Level -
                      Aggregated Investments




Total

Year

                                                             Source: IVC


                                                                           44
                   Israeli VC Funds
Percentage of Israeli VC Funds Making No Investments




                             Source: PriceawaterhouseCoopers’ Israeli Money Tree Report


                                                                                          45
                                 Israeli VC Exits - IPOs
                Share of VC Backed IPOs in Total Israeli IPOs, 1995 – 2008
                                    No. of Offerings




IPOs (Number)

        Year


                                                                             Source: IVC


                                                                                           46
                                  Israeli VC Exits - IPOs
                 Share of VC Backed IPOs in Total Israeli IPOs, 1995 – 2008
                                      Capital Raised




Capital Raised

         Year

                                                                              Source: IVC


                                                                                            47
                                 Israeli VC Exits – M&As
                Share of VC Backed M&As in Total Israeli M&As, 1995 – 2008
                                       No. of Deals




M&As (Number)

        Year

                                                                             Source: IVC


                                                                                           48
                               Israeli VC Exits – M&As
              Share of VC Backed M&As in Total Israeli M&As, 1995 – 2008
                                     Deal Volume




Deal Volume

      Year


                                                                           Source: IVC


                                                                                         49
                                                      VC Backed Employment
                                  Current Companies and Employment in Hi-Tech Companies in Israel -
                                 VC Backed and Non-VC Backed Companies Excluding Foreign R&D Units




                            3,859 Companies                                                                      207,963 Jobs



Source: IVC.
Data is for active private and public Israeli and Israeli-related high-tech companies. Includes non-Israeli employment.
VC Backed companies include companies that received f unding f rom an Israeli or f oreign VC f und(s).
Data ref lect data available as of March, 24, 2009.


                                                                                                                                50
                                                         VC Backed Employment
                                     Current Companies and Employment in Hi-Tech Companies in Israel -
                                      VC Backed and Non-VC Backed Companies and Foreign R&D Units




                          4,067 Companies                                                                                  244,784 Jobs


Source: IVC.
Data is f or active private and public Israeli and Israeli-related high-tech companies and f oreign R&D units in Israel.
Non-f oreign R&D units data includes non-Israeli employment.
Foreign R&D units data includes only Israeli employment (in Israel).
VC Backed companies include companies that received f unding f rom an Israeli or f oreign VC f und(s).
Data ref lect data available as of March, 24, 2009.


                                                                                                                                          51
      The Impact of VC Investments on the Business Sector, 1999 – 2008
                             Quarterly Data, Sources: Bank of Israel, CBS, IVC



 The impact of VC investments on Israel’s business GDP, wages and exports is
  high and statistically significant:

     1% increase in VC investments translates into a 0.03% - 0.04% increase in
        business GDP: In 2008 terms, an increase of 74m NIS to VC investments
        (7,428m NIS) translates into a 253m NIS increase in business GDP;

     1% increase in VC investments translates into a 0.09% increase in Hi-tech
        Employment: Xm NIS in 2008.

     1% increase in VC investments translates into a 0.05% increase in
        business sector wages: Xm NIS in 2008.

     1% increase in VC investments translates into a 0.14% increase in exports:
        403m NIS in 2008.

 The impact of VC investments on business sector employment is low but
  statistically insignificant.

 It follows that the impact of VC investments on business sector efficiency is   52
          The Impact of VC Investments on the Business Sector, 1999 – 2008
                                        Yearly Data, Sources: Bank of Israel, CBS, IVC



 The impact of VC investments on Israel’s business GDP, hi-tech employment, exports and productivity is high
   and statistically significant:

 1% increase in VC investments translates into a 0.07% increase in business GDP;

          This compares with a 0.05% increase for a 1% increase in R&D business expenditures excluding VC;

 1% increase in VC investments translates into a 0.37% increase in hi-tech employment;

          This compares with a 0.31% increase for a 1% increase in R&D business expenditures excluding VC;

 1% increase in VC investments translates into a 0.51% increase in total exports.

          This compares with a 0.53% increase for a 1% increase in R&D business expenditures excluding VC;

 The impact of VC investments on business sector efficiency is positive and statistically significant.

 The positive impact on business GDP and employment transmits into taxes.

 The above results have been estimated with a low number of observations:

          The statistical significance of the impacts of both VC and R&D expenses excluding VC is robust and can
           thus be relayed on with a high degree of confidence;

          The magnitude of the impact should be regarded carefully and the above estimates should be used only
           as indicators.

                                                                                                                    53
       Why is the VC sector important to the Israeli Economy?


  Contribution of VC Investments and Business R&D Expenditures
                      2007 Economical Impact

                                                                           R&D
 Growth in:                      VC Investments                   Business Expenditures
 (medium-long term)             Increase of $20m                 Excluding VC Investments
                                                                     Increase of $40m

 Business GDP                            $60m                                   $60m


 Hi-Tech Jobs                         800 Jobs                              1,000 Jobs

Note:
Raw data sources: Bank of Israel, CBS, IVC
The above results have been estimated with a low number of observations.
The numbers are point-in-time estimates and are therefore subject to variations in the economic variables they
refer to.
Therefore they should be regarded as indicators only.


                                                                                                                 54
                         Thank You


E.G.P Applied Economics Ltd. Research and Consulting in Economics, Marketing and Social Sciences.
        48 Menachem Begin Rd., Tel-Aviv 66184, Phone: 972-3-6375000, Fax: 972-3-6390001
         The VC Industry in Israel:
An Empirical Analysis of Economic Potential




Annex: More Data




                                              56
           Diversification
VC Investments by Industry – 2008, US




US Total VC Investments $28.3 Billion
                         Source: PricewaterhouseCoopers’ Money Tree Reports


                                                                              57
            Diversification
VC Investments by Industry – 2008, Israel




Israel Total VC Investments $1.4 Billion
                           Source: PricewaterhouseCoopers’ Money Tree Reports


                                                                                58
                                           The VC Industry in Israel:
                                  An Empirical Analysis of Economic Potential
The Industry Classifications used in the MoneyTree™ Report are as follows:
Biotechnology
         Developers of technology promoting drug development, disease treatment, and a deeper understanding of living organisms. Inclu des human, animal, and industrial biotechnology
         products and services. Also included are biosensors, biotechnology equipment, and pharmaceuticals.
Business Products and Services
         Offers a product or service targeted at another business such as advertising, consulting, and engineering services. Also incl udes distributors, importers, and wholesalers.
Computers and Peripherals
         Includes manufacturers and distributors of PCs, mainframes, servers, PDAs, printers, storage devices, monitors, and memory ca rds. Also included are digital imaging and graphics
         services and equipment such as scanning hardware, graphics video cards and plotters. Integrated turnkey systems and solutions are also included in this category.
Consumer Products and Services
         Offers products or services targeted at consumers such as restaurants, dry cleaners, automotive service centers, clothing, to iletries, and house wares.
Electronics/Instrumentation
         Includes electronic parts that are components of larger products and specialized instrumentation, including scientific instru ments, lasers, power supplies, electronic testing products
         and display panels. Also included are business and consumer electronic devices such as photocopiers, calculators, and alarm s ystems.
Financial Services
         Providers of financial services to other businesses or individuals including banking, real estate, brokerage services, and fi nancial planning.
Healthcare Services
         Includes both in-patient and out-patient facilities as well as health insurers. Included are hospitals, clinics, nursing facilities, managed care organizations, Physician Practice
         Management Companies, child care and emergency care.
Industrial/Energy
         Producers and suppliers of energy, chemicals, and materials, industrial automation companies and oil and gas exploration comp anies. Also included are environmental, agricultural,
         transportation, manufacturing, construction and utility-related products and services.
IT Services
         Providers of computer and internet-related services to businesses and consumers including computer repair, software consulting, computer training, machine leasing/rental, disaster
         recovery, web design, data input and processing, internet security, e-commerce services, web hosting and systems engineering.
Media and Entertainment
         Creators of products or providers of services designed to inform or entertain consumers including movies, music, consumer ele ctronics such as TVs/stereos/games, sports facilities
         and events, recreational products or services. Online providers of consumer content are also included in this category (medic al, news, education, legal).
Medical Devices and Equipment
         Manufactures and/or sells medical instruments and devices including medical diagnostic equipment (X-ray, CAT scan, MRI), medical therapeutic devices (drug delivery, surgical
         instruments, pacemakers, artificial organs), and other health related products such as medical monitoring equipment, handicap aids, reading glasses and contact lenses.
Networking and Equipment
         Providers of data communication and fiber optics products and services. Includes WANs, LANs, switches, hubs, routers, coupler s, and network management products, components
         and systems.
Retailing/Distribution
         Firms making consumer goods and services available for consumer purchase including discount stores, super centers, drug store s, clothing and accessories retailers, computer
         stores and book stores. Also included in this group are e-Commerce companies ---those selling their products or services via the Internet.
Semiconductors
         Design, develop or manufacture semiconductor chips/microprocessors ore related equipment including diodes and transistors. Al so includes companies that test or package
         integrated circuits.
Software
         Producers of bundled and/or unbundled software applications for business or consumer use including software created for syste ms, graphics, communications and networking,
         security, inventory, home use, educational, or recreational. Also included is software developed for specific industries such as banking, manufacturing, transportation, or healthcare.
Telecommunications
         Companies focused on the transmission of voice and data including long distance providers, local exchange carriers, and wirel ess communications services and components. Also
         included are satellite and microwave communications services and equipment.
Other
         If the classification criterion in all of the other categories does not appropriately describe the product or service offered , the firm may be categorized in this group.



                                                                                                                                                                                               59
 VC Investments by Main Country/Region - US, Europe, China, Israel




Total
Year



                                              Source: Dow Jones VentureSource (E&Y)


                                                                                      60
        VC Backed Companies by Year of Initial Funding –
                   US, Europe, China, Israel




Total
Year



                                                 Source: Dow Jones VentureSource (E&Y)


                     Back to M&As      Back to IPOs                                      61
                                    Exits
M&A Transactions Divided by Number of Companies Initially Funded in Same Year -
                              US, Europe, Israel




                                                       Source: Dow Jones VentureSource (E&Y)


                                      Back to M&As                                             62
                                    Exits
IPO Transactions Divided by Number of Companies Initially Funded in Same Year -
                              US, Europe, Israel




                                                       Source: Dow Jones VentureSource (E&Y)


                                      Back to IPOs                                             63
Worldwide VC Investments by Cluster - 2008




                              Source: Dow Jones VentureSource (E&Y)


                                                                      64
VC Median Investment Round Size, Start-Up Companies –
                  US, Israel, Europe




                                      Source: Dow Jones VentureSource (E&Y)


                                                                              65
VC Median Investment Round Size, Product Development Companies -
                       US, Israel, Europe




                                            Source: Dow Jones VentureSource (E&Y)


                                                                                    66
VC Median Investment Round Size, Revenue Generating Companies -
                       US, Israel, Europe




                                           Source: Dow Jones VentureSource (E&Y)


                                                                                   67
VC Median Investment Round Size, Profitable Companies -
                  US, Israel, Europe




                                        Source: Dow Jones VentureSource (E&Y)


                                                                                68
Higher Educations R&D Personnel Per Million Capita –
                Israel, Europe, Asia




                                                       Source: OECD


                                                                      69
Business Sector R&D Personnel Per Million Capita – Israel, Europe, Asia




                                                             Source: OECD


                                                                            70
                                Companies Founded by Entrepreneurs in Israel -
                                  VC Backed and Non-VC Backed Companies




                                                 5,629 Companies Founded By 8,110 Entrepreneurs


Source: IVC. Includes data as f ar as the 1950s but the mass of the data is f rom 1999 onwards up to March 2009.
Founders (entrepreneurs) include Israeli and Non-Israeli f ounders of Israeli and Israel-related high-tech companies.
VC Backed companies include companies that received f unding f rom an Israeli or f oreign VC f und(s).

                                                                                                                        71
             Companies Founded by Entrepreneurs in Israel - By Current Status -
                       VC Backed and Non-VC Backed Companies




        Total


Source: IVC. Includes data as f ar as the 1950s but the mass of the data is f rom 1999 onwards up to March 2009.
Founders (entrepreneurs) include Israeli and Non-Israeli f ounders of Israeli and Israel-related high-tech companies.
VC Backed companies include companies that received f unding f rom an Israeli or f oreign VC f und(s).

                                                                                                                        72
Patent Applications per Million Capita- EPO




                                      Source: EPO


                                                    73
   Patent Granted per Million Capita- EPO, 1998 - 2007




Source: EPO Asia does not include Singapore.
Its inclusion would probably lower Asia, but not too much.


                                                             74
Patent Applications to Patents Granted – USPTO
              Average 1990 - 2000




                                             Source: USPTO


                                                             75
Patent Applications to Patents Granted – EPO
            Average 1998 - 2005




                                               Source: EPO


                                                             76
                                     International Recognition
                            Foreign Companies With R&D Units In Israel
                              By Number of R&D Units per Company




Source: IVC Yearbook 2008


                                                                         77
Average Investment Levels in Israeli Hi-Tech Companies -
             VC Backed and All Companies




                                                       Source: IVC


                                                                     78
Activity of Israeli VC Funds by Investment Level -
       Average Investment Level per Fund




                                                     Source: IVC


                                                                   79
        Investments in Israeli Hi-Tech Companies -
                 Distribution by Sector




Total
Year


                                                     Source: IVC


                                                                   80
Investments in Israeli Hi-Tech Companies -
       Israeli VC Share by Sector

                   Time Average




                                             Source: IVC


                                                           81
                           Current Hi-Tech Companies in Israel by Technology Sector -
                     VC Backed and Non-VC Backed Companies Excluding Foreign R&D Units




             Total



Source: IVC.
Data is for active private and public Israeli and Israeli-related high-tech companies. Includes non-Israeli employment.
VC Backed companies include companies that received funding from an Israeli or foreign VC fund(s).
Data reflect data available as of March, 24, 2009.


                                                                                                                          82
           Current Hi-Tech Companies in Israel by Technology Sector -
        VC Backed and Non-VC Backed Companies and Foreign R&D Units




Total




         Source: IVC.
         Data is for active private and public Israeli and Israeli-related high-tech companies and foreign R&D units in Israel.
         Non-foreign R&D units data includes non-Israeli employment.
         Foreign R&D units data includes only Israeli employment (in Israel).
         VC Backed companies include companies that received funding from an Israeli or foreign VC fund(s).
         Data reflect data available as of March, 24, 2009.
                                                                                                                                  83
                  Current Employment in Hi-Tech Companies in Israel by Technology Sector –
                   VC Backed and Non-VC Backed Companies Excluding Foreign R&D Units




             Total



Source: IVC.
Data is for active private and public Israeli and Israeli-related high-tech companies. Includes non-Israeli employment.
VC Backed companies include companies that received funding from an Israeli or foreign VC fund(s).
Data reflect data available as of March, 24, 2009.


                                                                                                                          84
 Current Employment in Hi-Tech Companies in Israel by Technology Sector –
     VC Backed and Non-VC Backed Companies and Foreign R&D Units




Total




        Source: IVC.
        Data is for active private and public Israeli and Israeli-related high-tech companies and foreign R&D units in Israel.
        Non-foreign R&D units data includes non-Israeli employment.
        Foreign R&D units data includes only Israeli employment (in Israel).
        VC Backed companies include companies that received funding from an Israeli or foreign VC fund(s).
        Data reflect data available as of March, 24, 2009.
                                                                                                                                 85
Current Hi-Tech Average Jobs per Company - By Technology Sector -
             VC Backed and Non-VC Backed Companies




     Source: IVC.
     Data is for active private and public Israeli and Israeli-related high-tech companies and foreign R&D units in Israel.
     Non-foreign R&D units data includes non-Israeli employment.
     Foreign R&D units data includes only Israeli employment (in Israel).
     VC Backed companies include companies that received funding from an Israeli or foreign VC fund(s).
     Data reflect data available as of March, 24, 2009.
                                                                                                                              86
  Share of Wage Compensation in GDP –
High Tech and Business Sector, 1995 – 2008




                                             Source: CBS


                                                           87
        Hi-Tech GDP, 1995 – 2007




Total

Year


                                   Source: CBS


                                                 88
        Hi-Tech Employment, 1995 – 2007




Total

Year


                                          Source: CBS


                                                        89
        Hi-Tech Wage Compensation, 1995 – 2007




Total

Year

                                           Source: CBS


                                                         90
        Hi-Tech in Exports of Goods and Services, 1995 – 2007




Total

Year

                                                           Source: CBS


                                                                         91
The Impact of VC Investments on Business GDP, 1999 – 2007
                    Yearly Data, Sources: Bank of Israel, CBS, IVC




 lgdp = business GDP (natural log)
 lw = workers in business sector (natural log)
 linv = fixed assets investments in business sector (natural log)
 lrdnovc= business sector R&D expenditures excluding VC investments (natural log)
 lvc = vc investments (natural log)




                                                                                    92
The Impact of VC Investments on Hi-Tech Jobs, 1999 – 2008
                    Yearly Data, Sources: Bank of Israel, CBS, IVC




lw_hi = workers in hi tech sector (natural log)
lrdnovc= business sector R&D expenditures excluding VC investments (natural log)
Lvcy = vc investments (natural log)




                                                                                   93
The Impact of VC Investments on Total Exports, 1999 – 2008
                    Yearly Data, Sources: Bank of Israel, CBS, IVC




lw_hi = workers in hi tech sector (natural log)
lrdnovc= business sector R&D expenditures excluding VC investments (natural log)
Lvcy = vc investments (natural log)




                                                                                   94

				
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