Following an article from last week’s Jerusalem Post regarding Israel’s “much-hyped” venture capital market, which noted the favored status of the growing cleantech sector, Globes has reported two cleantech venture fund announcements out of Israel. Terra Venture Partners LP has raised its first $15 million, which it plans to invest in 10 startups, including IQWind, makers of a high-efficiency wind turbine gearbox, and Phoebus, a water heating company. Also, Greylock Partners and Israel Cleantech Ventures said they are forming a joint platform for investment in early-stage cleantech startups.
“The hype surrounding cleantech in Israel continues to increase. And yet one thing is missing — deals,” Asher Mechlovich, partner and head of the division focused on technology media & telecommunications industry at Deloitte Brightman Almagor, told the Jerusalem Post. Terra and the Greylock-Israel Cleantech partnership are both just starting to make deals and Terra plans to raise between $40 million and $50 million by the end of the year.
These announcements come as the fourth annual Water Technologies & Environmental Control Conference (WATEC), hosted by Ernst & Young Israel, CleanTech Venture Network and Morrison Foerster, kicks off. Serving as a showcase for Israel’s rapidly expanding water technology sector, the conference seeks to solidify “the position of Israel as the ‘Silicon Valley’ of the global water and environmental technologies market,” WATEC Chairman Booky Oren said in his welcoming remarks on the event’s web site. According to the Jerusalem Post, Israeli water-tech exports are expected to top $1 billion by the end of the year, up from $850 million in 2006.
Hype or no hype, only recently have deals between Israeli venture capitalists and Israeli cleantech entrepreneurs been gaining momentum. Mechlovich says “one of the major causes for the gap between the markets expectations and actual investments is lack of cleantech investment knowledge.” The WATEC conference can do a lot to bridge this gap and is slated to have many veteran cleantech speakers, including CEOs and government ministers from all over the globe.
This conference comes at a time when water scarcity is making global headlines — from Australian droughts to Californian wildfires to Chinese aerobic rice. Governments are sending delegates to look for water technology solutions; the gathering could net companies lucrative government contracts. Between the Terra and Greylock/Cleantech Venture and the potential windfall of investments from WATEC, those missing cleantech deals in Israel may appear sooner than expected.