A Hewlett-Packard tablet computer. As American and Israeli schools shift from textbooks to tablets, entrepreneurs from the “startup nation” are hoping they can bank on the trend. Photo: Janto Dreijer via Wikimedia Commons.

CTech – The Israeli tech sector is maturing and so are entrepreneurs who now have more patience and are able to build significant market-leading companies, according to Boaz Dinte, managing partner at Tel Aviv-based late-stage venture capital firm Qumra Capital.

Qumra will participate in Calcalist’s fourth Mind the Tech conference, which will take place in New York between March 30 and April 1. The conference will be held in partnership with Israel’s Bank Leumi and the Jerusalem Development Authority. Qumra will showcase 10 promising startups at the event, chosen for demonstrating the greatest potential for growth.

At last year’s event, Qumra presented a list of 10 promising companies its partners believed had the potential to reach over $10 million in annual revenues. Of the companies selected in 2019, eight raised substantial rounds and one company was acquired over the past year.

The most significant leap was made by Tel Aviv-based cybersecurity startup Snyk, which started 2020 with an announcement of a $150 million round at a valuation of more than $1 billion. The announcement came just several months after Snyk raised $70 million. At the time, the company also stated its annual revenue quadrupled in 2019 and it has recruited significant clients like Google, multinational cloud company Salesforce.com, and software company Intuit.

Another company that managed to squeeze in two impressive rounds in less than a year is New York-based cybersecurity company BigID, whose data protection enterprise software uses machine learning algorithms to track and guard customer and employee data. BigID announced two consecutive $50 million rounds in the past six months.

Another of the companies selected by Qumra last year, Tel Aviv-based industrial infrastructure cybersecurity company Indegy, was acquired in late 2019 by Nasdaq-listed Tenable Holdings for $78 million in cash.

The other companies on the list also did not disappoint: Tel Aviv-based gut microbiome startup DayTwo raised $31 million; New York-headquartered enterprise cybersecurity company Siemplify, incorporated as Cyarx Technologies, raised $30 million; and predictive maintenance company Augury Systems and compostable plastic company TIPA Corp have each raised $25 million.

“There are great entrepreneurs out there with excellent skills to build companies that employ hundreds of people and bring in over $100 million in annual revenue,” Dinte said in an interview with Calcalist. “Available funding allows companies to hold off on any early exit plans and invest in growing the company, organically and inorganically. We see a lot more companies today making significant acquisitions as part of their growth process.”

“In the past few years there has also been a shift in the business models of software companies, with software-as-a-service (SaaS), land and expand, and inbound sales,” Dinte said. All of these developments work in favor of Israeli companies, helping them establish a substantial and efficient sales base quickly, he added.

At this year’s conference, Qumra will present a similar list of 10 companies. Registration is open to startups working in all fields that have more than $2 million and less than $8 million in annual revenues. In the upcoming month, candidates will be screened and examined with an emphasis on the quality of their product and technology, the potential size of their market, their competitive advantage, and their potential growth rate.

Some of the candidates will be invited to present their companies in front of a professional committee, composed of Qumra partners and executives from Ernst & Young (EY), Qualcomm Ventures, Leumi’s technology banking arm Leumitech, Scale Venture Partners (SVP), and Israel-based law firm Meitar Liquornik Geva Leshem Tal. The winners will be announced on March 31 at the Mind the Tech conference in New York.