Appendix 1 –
Methodology for the Innovation Authority Surveys
Surveys’ Objective
Following the challenges faced by the Israeli high-tech sector in 2023 and ahead of the launch of the ‘Yozma 2.0’ Fund, the Innovation Authority conducted several surveys among Israeli high-tech companies and Israeli venture capital funds. The objective was to attain an updated situation report on the Israeli economy in order to plan its investment policy. In the future, these surveys are expected to be conducted by the Innovation Authority with the aim of monitoring market expectations.
The High-Tech Companies Survey
The “State of High-Tech Companies in Israel” survey has been conducted twice so far and targeted Israeli high-tech companies at various stages. The first round of the survey was conducted from November to mid-December 2023 while the second round was conducted from late March to late April 2024. The surveys were sent to all the CEOs and CFOs found to have a valid email in the IVC database and data was collected by self-reply email. Because response to the survey was voluntary, there may be a bias due to the nature of the respondents.
The first round exclusively targeted young startups and included active companies that were founded in the years 2021-2023 or raised capital in funding rounds defined as Pre-Seed, Seed, First Round, and Second Round during this period, according to IVC data. The survey’s population in the first round numbered about 2,900 companies. The second round targeted all the high-tech companies active in Israel that existed in the database – a total of approximately 8,500 companies. The level of participation in the first round was 18% (522 companies) and in the second round 6% (489 companies). In each round, the population was divided into layers according to the company’s sector of activity and its funding stage. After gathering the data, a correction was made to account for non-respondents whereby the results of those who responded were weighted for each layer by calculating the number of companies in that layer divided by its number of respondents.
Venture Capital Funds Survey
The “Venture Capital Funds in Israel” survey was conducted in conjunction with the IATI (Israel Advanced Technology Industries) Association. The survey targeted venture capital funds that are members of the IATI. The survey’s population includes Israeli venture capital funds, private investment funds and global venture capital funds with a presence in Israel. 31 funds responded to the survey. An examination of the data reveals that the Israeli funds that responded to the survey represent about a third of the assets under management (AUM) of active Israeli funds.
Distribution of the survey to the various funds began in January 2024 and some of them (7 funds) responded immediately, however, most of the respondents (24 funds) completed the survey in April 2024. Most of the respondents were Israeli funds (27 respondents) but there were also a few international funds (4 funds). The funds responding to the survey represent a diverse variety of sizes and areas of activity. No correction or inflation of the results was made to account for non-respondents and the survey solely represents the respondents.
Appendix 2 –
Innovation Authority Activity in 2023
The Israel Innovation Authority endeavors to provide a solution to the different challenges facing the Israeli innovation hub via three operational units called “divisions”. Each division is mission-oriented and offers a unique toolbox that is adapted to the various challenges in the technological lifecycle.
The Innovation Authority’s divisions undertook a variety of initiatives during 2023 with the aim of advancing the growth of the Israeli innovation hub. The table below details the different divisions’ activity last year, according to the programs they operate:1Descriptions of the different tracks and programs appear on the Innovation Authority website and in previous reports published by the Authority.
Growth Division
| Area of Activity | Program | No. of Requests Submitted in 202328-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of Approvals Given in 202338-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of New Companies Approved4The requests and approvals are presented according to files submitted. Some companies have several submissions and even several approvals in the same program or in several programs. Accordingly, companies that first received grants from the Authority in 2023 and which received more than one grant in the same program, are counted once under the definition “new companies in the same program”. Companies that first received grants from the Authority in 2023 in two different programs, are counted in each of the programs as “new companies”. Accordingly, a total of 383 new companies were approved in 2023. | Total Grants Approved (millions of shekels) |
|---|---|---|---|---|---|
| High-tech Industry | R&D Fund | 507 | 241 | 67 | 491.77 |
| Fast-Track Grants | 510 | 91 | 17 | 144.83 | |
| Pilots | 157 | 54 | 19 | 62 | |
| Disruptive Initiatives | 6 | 2 | 0 | 8.41 | |
| International Collaboration | 121 | 39 | 9 | 28.8 | |
| TOTAL | 1,301 | 427 | 735.81 | ||
| Production Oriented Industry | MOFET (R&D in Industry) | 111 | 77 | 15 | 72.92 |
| From Development to Manufacturing | 59 | 27 | 5 | 53.28 | |
| R&D Preparatory Program | 72 | 68 | 46 | 4.83 | |
| סך הכול | 242 | 172 | 131.03 |
Startup Division
| Area of Activity | Program | No. of Requests Submitted in 202358-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of Approvals Given in 202368-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of New Companies Approved7The requests and approvals are presented according to files submitted. Some companies have several submissions and even several approvals in the same program or in several programs. Accordingly, companies that first received grants from the Authority in 2023 and which received more than one grant in the same program, are counted once under the definition “new companies in the same program”. Companies that first received grants from the Authority in 2023 in two different programs, are counted in each of the programs as “new companies”. Accordingly, a total of 383 new companies were approved in 2023. | Total Grants Approved (millions of shekels) |
|---|---|---|---|---|---|
| High-tech Industry | Incubators | 94 | 81 | 41 | 136.98 |
| Seed | 25 | 14 | 11 | 26.9 | |
| Technological Innovation Labs | 15 | 14 | 10 | 15.58 | |
| Encouraging High-tech Ideation and Entrepreneurship | 44 | 15 | 9 | 32.9 | |
| Haifa Entrepreneurship8The Haifa Entrepreneurship, Beer Sheva Entrepreneurship, Advancing Growth Engines, and Young Entrepreneurship programs in the Startup Division are initiatives in which a franchisee is chosen to run the initiative for several years. During each year of the franchise, the franchisee is required to submit a yearly work plan before approval of the grant. | 1 | 1 | 0 | 5.00 | |
| Beer Sheva Entrepreneurship9The Haifa Entrepreneurship, Beer Sheva Entrepreneurship, Advancing Growth Engines, and Young Entrepreneurship programs in the Startup Division are initiatives in which a franchisee is chosen to run the initiative for several years. During each year of the franchise, the franchisee is required to submit a yearly work plan before approval of the grant. | 1 | 1 | 0 | 7.50 | |
| Tenufa | 341 | 113 | 86 | 12.86 | |
| Cultivation and Guidance of Entrepreneurs | 23 | 14 | 8 | 8.24 | |
| Platforms Connecting Employers and Employees | 22 | 4 | 3 | 1.86 | |
| Advancing Growth Engines10The Haifa Entrepreneurship, Beer Sheva Entrepreneurship, Advancing Growth Engines, and Young Entrepreneurship programs in the Startup Division are initiatives in which a franchisee is chosen to run the initiative for several years. During each year of the franchise, the franchisee is required to submit a yearly work plan before approval of the grant. | 1 | 1 | 0 | 4.45 | |
| Young Entrepreneurship11The Haifa Entrepreneurship, Beer Sheva Entrepreneurship, Advancing Growth Engines, and Young Entrepreneurship programs in the Startup Division are initiatives in which a franchisee is chosen to run the initiative for several years. During each year of the franchise, the franchisee is required to submit a yearly work plan before approval of the grant. | 1 | 1 | 0 | 3.00 | |
| TOTAL | 568 | 259 | 255.27 | ||
| Human Capital | Human Capital for High-tech Fund | 105 | 39 | 11 | 45.27 |
| TOTAL | 105 | 39 | 45.27 |
Innovation Infrastructures Division
| Area of Activity | Program | No. of Requests Submitted in 2023128-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of Approvals Given in 2023138-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of New Companies Approved14The requests and approvals are presented according to files submitted. Some companies have several submissions and even several approvals in the same program or in several programs. Accordingly, companies that first received grants from the Authority in 2023 and which received more than one grant in the same program, are counted once under the definition “new companies in the same program”. Companies that first received grants from the Authority in 2023 in two different programs, are counted in each of the programs as “new companies”. Accordingly, a total of 383 new companies were approved in 2023. | Total Grants Approved (millions of shekels) |
|---|---|---|---|---|---|
| Research Knowledge | Applied Research in Academia | 285 | 138 | 15In the Innovations Infrastructures Division, the grants in the Applied Research in Academia and Knowledge Commercialization Programs as well as some of the grants in the MAGNET Consortiums are awarded to researchers in academia. The number of submissions and approvals in these programs relates to all those submitting requests, however the number of new companies approved relates exclusively to companies (and does not include researchers). | 92.89 |
| Knowledge Commercialization | 151 | 92 | 16In the Innovations Infrastructures Division, the grants in the Applied Research in Academia and Knowledge Commercialization Programs as well as some of the grants in the MAGNET Consortiums are awarded to researchers in academia. The number of submissions and approvals in these programs relates to all those submitting requests, however the number of new companies approved relates exclusively to companies (and does not include researchers). | 55.39 | |
| Consortiums within the Framework of the Europe Horizon Program (KDT) | 5 | 5 | 0 | 13.02 | |
| MAGNET Consortiums | 125 | 111 | 117In the Innovations Infrastructures Division, the grants in the Applied Research in Academia and Knowledge Commercialization Programs as well as some of the grants in the MAGNET Consortiums are awarded to researchers in academia. The number of submissions and approvals in these programs relates to all those submitting requests, however the number of new companies approved relates exclusively to companies (and does not include researchers). | 106.41 | |
| Applied Research in Industry | 38 | 30 | 0 | 74.47 | |
| Dual R&D | 83 | 38 | 9 | 44.04 | |
| TOTAL | 687 | 414 | 386.22 | ||
| Infrastructures | Infrastructures and Equipment for R&D | 53 | 23 | 6 | 59.48 |
| TOTAL | 53 | 23 | 59.48 |
International Division
| Area of Activity | Program | No. of Requests Submitted in 2023188-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of Approvals Given in 2023198-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of New Companies Approved20The requests and approvals are presented according to files submitted. Some companies have several submissions and even several approvals in the same program or in several programs. Accordingly, companies that first received grants from the Authority in 2023 and which received more than one grant in the same program, are counted once under the definition “new companies in the same program”. Companies that first received grants from the Authority in 2023 in two different programs, are counted in each of the programs as “new companies”. Accordingly, a total of 383 new companies were approved in 2023. | Total Grants Approved (millions of shekels) |
|---|---|---|---|---|---|
| Bilateral Funds218-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | 92 | 11 | 30.43 | ||
| Europe Horizon Assistance Fund | 37 | 38 | 0 | 1.23 | |
| סך הכול | 129 | 49 | 18 | 31.66 |
TOTAL – Direct Authority Funding
| Area of Activity | No. of Requests Submitted in 2023228-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of Approvals Given in 2023238-12 weeks elapse in most requests between the time a request is submitted and the time it is brought to the committee for approval. Accordingly, the figures for 2023 approvals also include requests submitted at the end of 2022, and some of the submissions for 2023 (those submitted at the end of the year) which were only discussed by committees in 2024. Specifically, in the Bilateral Funds, over 40 of the submissions during 2023 were only discussed in 2024. | No. of New Companies Approved24The requests and approvals are presented according to files submitted. Some companies have several submissions and even several approvals in the same program or in several programs. Accordingly, companies that first received grants from the Authority in 2023 and which received more than one grant in the same program, are counted once under the definition “new companies in the same program”. Companies that first received grants from the Authority in 2023 in two different programs, are counted in each of the programs as “new companies”. Accordingly, a total of 383 new companies were approved in 2023. | Total Grants Approved (millions of shekels) |
|---|---|---|---|---|
| TOTAL – Direct Authority Funding | 3,085 | 1,383 | 1644.74 |
TOTAL – Including the R&D Program of the EU
| מסלול / תוכנית | סך מענקים שאושרו במיליוני ש”ח | |
|---|---|---|
| Horizon Europe – The R&D Program of the EU | The Authority’s share of the annual payment to the EU, that is allocated to funding the local industry.25The Authority pools resources from the participating government entities – The Committee for Budget and Planning, The Ministry of Innovation, Science and Technology, and the Innovation Authority – and transfers the annual participation payment to the EU. The total participation payment in 2023 was 1,512 million shekels – approximately EUR 378 million. | 604.68 |
| TOTAL – Including the R&D Program of the EU | 2,236.51 |
Appendix 3 –
Work Plans in 2023
Startup Division
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Formulation of a methodology for identifying new ecosystems and obstacles to their growth | Fully met |
| Successful operation of entrepreneurial programs for women and Arab society | Partially met |
| Approval of programs for the new startup fund | Fully met |
Growth Division
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Approval of programs for the new startup fund | Fully met |
| Raising the number of submissions in the international collaboration fund for development of pilots | Fully met |
| Formulation of a methodology for identifying mature ecosystems | Not met |
| Update of the MOFET Program | Partially met |
| Mapping the value chain of complete Israeli companies and formulation of recommendations for increasing their influence | Fully met |
InfrastructuresDivision
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Identification and incentivization of emerging technologies | Fully met |
| Approval of plan to enhance effectiveness of the programs for incentivizing and commercializing applied research in academia | Fully met |
| Mapping of knowledge gaps in the Israeli innovation hub and approval of a program to import relevant knowledge from overseas | Partially met |
Strategic Division
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Formulation of methodology for assessing the standing of the Israeli innovation hub in global terms | Fully met |
| Launch of at least three disruptive initiatives | Partially met |
| Formulation of a sectorial risk model for investors and for funding according to technology and market fields | Fully met |
| Presentation of insights from three studies (internal and external, together with academia) for measuring effectiveness of the Authority’s activity | Fully met |
Technology Division
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Completion of selection, hiring, and training of new expert evaluators and a refresher program for veteran evaluators | Fully met |
| Assimilation of unstructured data analysis capability in historical expert opinions | Fully met |
International Division
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Enhanced effectiveness and relevance of bilateral funds | Fully met |
| Approval of multi-year plans of action from the steering committee of the Horizon Program for optimal utilization | Partially met |
| Formulation of strategic plan of action with the US, with an emphasis on the field of semiconductors | Fully met |
Artificial Intelligence Program
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Implementation of first phase | Fully met |
| Definition of the second phase out of agreement with all partners in the TELEM Forum | Partially met |
| Incentivization of three initiatives via Authority tools | Fully met |
Bio-convergence Program
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Approval of the program’s full outline in the TELEM Forum | Fully met |
| Publishing of a tender to establish bio-devices infrastructures | Fully met |
| Incentivization of three initiatives via Authority tools | Fully met |
Climate Program
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Definition of climate-tech clusters with an advantage to Israel and mapping of relevant obstacles | Fully met |
| An increase of at least 15% in direct submissions of climate companies in all Authority programs | Fully met |
Operational Division
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Compliance with the Authority’s SLA (submission until response; response until operation; reporting until payment; final report until final accounting; request for changes until decision) | Partially met |
| Meeting the goal of collecting royalties | Fully met |
Organizational Development Division
| Goal / Achievement | Met (Fully / Partially / Not Met) |
|---|---|
| Upload of four improved versions to the organizational computer system | Fully met |
| Formulation and approval of a data strategy for the Authority | Partially met |
| Formulation of multi-year carbon footprint plan | Partially met |
| Achieving Grade 4 (out of 5) in client satisfaction survey | Fully met |
Appendix 4 –
Work Plans in 2024
Startup Division
- Launch of startup fund, pre-seed program
- Validation and activation of the new incubators model
- Accompaniment of the innovation centers’ first year of operation
- Operation of programs to increase entrepreneurial demographic diversity
- Operation of at least three Authority tools to rehabilitate and develop the Tekuma (Rebirth) region
Growth Division
- Launch of startup fund, Seed and “Round A” programs
- Launch of the ‘Yozma 2.0’ Fund
- Improvement in the effectiveness of the pilots’ programs in Israel and overseas, including coordinated initiatives
- Update of the MOFET Program
- Operation of five coordinated initiatives
Infrastructures Division
- Identification and incentivization of emerging technologies
- Increase in the influence and competitiveness of research in academia and industry programs
- A growth in transfer of knowledge from overseas academia to industry in Israel
- Encouraging the use of R&D infrastructures established and monitoring their performance
Strategic Division
- Identification and incentivization of emerging technologies
- Increase in the influence and competitiveness of research in academia and industry programs
- A growth in transfer of knowledge from overseas academia to industry in Israel
- Encouraging the use of R&D infrastructures established and monitoring their performance
Strategic Division
- Economic-financial-research accompaniment of the startup fund
- Formulation of an outline for the ‘Yozma 2.0’ Fund
- Launch of the innovation hub competitiveness index
- Presentation of study results in conjunction with academia in a professional seminar
Technology Division
- Preparation of a team of expert evaluators for launch of the startup fund
- Formulation and operation of a feedback model for evaluators
- Execution of a pilot for an AI-based system to support the expert evaluation process
International Division
- Improvement of the Horizon Program’s utilization – an increase of 5% in the number of Israeli submissions
- Increase in the chances of success when participating in consortiums by joining leading institutes in Europe
- Implementation of global business development
Artificial Intelligence Program
- Completion of first stage – infrastructures for training models and scientific calculation, accelerated execution of the human capital
- chapter and language model activity
- Initiation of at least three activities as part of the second stage
Bio-convergence Program
- Initiation of at least three activities as part of the national program
- Incentivization of research, germination, growth, and international activity of the Authority that integrates bio-convergence
Climate Program
- Incentivization of research, germination, and growth activity of the Authority in climate fields
- Removal of three growth obstacles in the nine clusters of activity identified last year
Organizational Development Division
- Completion of plan for the authority’s business continuity after physical, cyber damage etc.
- Completion and approval of the Authority’s data strategy
- Assimilation of the Authority’s new values
- Achieving Grade 4 (out of 5) in client satisfaction survey
- Building a training program
Additional articles in the magazine that may interest you
Preface
Introduction and Main Points
Part 1: Situation Report: Israeli High-Tech in 2024
Part 2: Issues Related to the Future of Israeli High-Tech