A typical hi-tech ecosystem consists of various stakeholders, each contributing their expertise to create a vibrant community, with both internal activity and a relationship with the external world.
Some of the most obvious constituents include academia – providing in-depth research and training for human capital; the government – aimed at creating infrastructure, facilitating and easing expansion, incentivizing and easing regulatory and bureaucratic bottlenecks; and large corporate, which provides ongoing business infrastructure and serves as a training ground for management. And finally, any ecosystem wouldn’t be disruptive without applied innovation, a function typically fulfilled by startups and early-stage investors.
Five years ago, Jerusalem Venture Partners (JVP), Israel’s leading VC, decided to expand its winning model and double-up on cyber-security as its next major focus area. In line with JVP founder and current Knesset Member Dr. Erel Margalit’s vision of creating seven regions of innovation excellence in Israel, we’ve created JVP Cyber Labs – our early stage investment arm for cyber-security startups— in the burgeoning tech hub of Beersheba. Our unique model incorporates a number of different elements: a day-in and day-out, hands-on approach with startups, an emphasis on collaboration with strategic partners (e.g., Cisco, GE, Deutsche Telecom, Alibaba, Siemens, Orange and others), partnerships with Ben Gurion University to create companies based on Intellectual Property devised in BGU labs, large seed investments, and emphasis on our pivotal role in the ecosystem. Utilizing this strategy, JVP Cyber Labs has invested in over 10 new cyber-security startups over the last 3.5 years of operation. Tens of millions of dollars have been invested in these unique companies, creating more than 250 new jobs and generating shareholder value in the hundreds of millions of dollars. Teaming up with the best entrepreneurs has yielded disruptive startups such as Morphisec, SDO, Coro.net and others and has resulted in exits such as PayPal’s acquisition of CyActive.
We continue to look for new opportunities, aiming at three new companies every year. Some of our key areas of interest are cloud security (e.g., serverless and SDx security), privacy, security automation and more.
At JVP, “double bottom line” activities, contributing both to the “greater good” of the ecosystem as well as to the success of our funds, is part of our DNA. That is why we are proud to be one of the founding members of CyberSpark (together with EMC, BGU and Lockheed Martin/Leidos), which continues to play a key role in developing the ecosystem further, paving the way for new stakeholders to play a role in what is turning out to be the most vibrant cyber-security ecosystem in the world.