1. Israel Venture Capital The Israeli Case

2. June 2006 IVA Overview The IVA is the organization representing the Israeli venture capital community. Venture Capital is a major source of financing for start-up and early stage technology companies. Israeli VCs have played a major role in making Israel an important global source of innovation.

3. June 2006 3 Israel’s High Tech Ecosystem Ingredients for Innovation:

4. June 2006 4 Multi Nationals with R&D Centers in Israel (Partial List) Alcatel Analog Devices AMCC Avaya BMC Software Boston Scientific Broadcom Computer Associates CEVA Cisco Conexant Freescale Semiconductor GE Medical Systems HP (including HP Labs) IBM Infineon Intel Interpharm KLA-Tencor Kollmorgen Servotronix Marvell Semiconductor Microsoft Motorola National Semiconductor Oracle Pfizer Phillips QUALCOMM Samsung SAP Siemens Silicon Graphics Sun Microsystems SunGard Texas Instruments Veritas Software

5. June 2006 5 Foreign VCs Investing in Israel Accel Partners Advent International Alice Ventures Alta Berkeley Amadeus Capital Ampersand Venture Management Apax Partners BancBoston Ventures Battery Ventures Benchmark Capital Bertelsmann Ventures Bessemer Venture Partners Boston Capital Ventures Global Catalyst Partners Greylock Partners HarbourVest Partners Hummer Winblad Venture Partners JAFCO Kodiak Venture Partners Lightspeed Venture Partners Menlo Ventures Mercator Ventures Meritech Capital Partners Merlin Biosciences Merrill Lynch Venture Capital Mission Ventures MPM Capital 133 Foreign VC Funds Invested in more than one company in Israel from 2000-2004 (Partial List) Cont.

7. June 2006 7 Capital Raised By Israeli VCs Source: IVC research center

8. June 2006 8 Capital Raised By Israeli Companies - 2006 $1.62 billion

9. June 2006 9 Israeli High Tech Companies Newly Established, by Sector 2001-2005 In 2004, more companies were established in life sciences than in any other industry for 4th consecutive year Source: IVC online database

10. June 2006 10 Capital Raised by High Tech Companies, Israel & US ($M) Source: Israel – IVC Research Center, US – Venture One

11. June 2006 11 Capital Raised by High Tech Companies, Israel & Europe ($M) Source: Israel – IVC Research Center, Europe – Venture One

12. June 2006 12 Cont. M&A Transactions (1996-2005) 9 12 21 38 63 28 65 61 58 34 389 Total Number of Deals 456 666 1,306 4,267 16,065 581 2,273 1,189 1,834 2,475 31,112 Total Volume ($M)Year 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Total

13. June 2006 13 Selected Hi Tech M&A 2005 Foreign Acquirers Acquirer HP Cisco System Broadcom McKesson eBay Juniper Networks Alcatel Intel Kodak Cadence Design UGS Israeli Company Scitex Vision Sheer Networks Siliquent Technologies Medcon Telemedicine Shopping.com Kagoor Networks Native Networks Oplus Technologies Orex Verisity Technomatix Industry Printing Technology Communications Medical Devices Internet Communications Enterprise Software Value of Acquisition 230 122 84 105 634 67 55 100 62 315 227

14. June 2006 14 Selected Hi Tech M&A 2005 Israeli Acquirers Israeli Acquirer Teva Comverse Amdocs Checkpoint Amdocs Retalix M-Systems Nice Foreign Acquirer Ivax CSG (GSS Division) DST Innovis Sourcefire Longshine TCI Solutions IDS Microelectronica Espanola Fast Video Security Dictaphone Industry Pharmaceutical Communications Enterprise Software Communications Enterprise Software Communications Value of Acquisition 7.400 251 238 225 30 34 44 40 21 38

15. June 2006 15 Selected Hi Tech M&A 2006 Foreign Acquirers (Partial List) Acquirer PMC- Sierra Johnson & Johnson EMC Stryker BMC Microsoft Dentsply TA associates Epix CA Microsoft Israeli Company Passave ColBar Kashya Sightline Identify Gteko Uri-Dent Alma Lasers Predix Xosoft Whale Industry Communications Life Science Enterprise Software Medical Devices Enterprise Software Medical Devices Pharmaceutical Enterprise Software Value of Acquisition 300 159 153 150 120 100 90 80-120 76

16. June 2006 16 Selected Hi Tech M&A 2006 Foreign Acquirers (Partial List) Acquirer Lucent Francisco partners LSI Logic Zerox Solutions 180 Fitserv AMS EMC Pricer EMC Unity Israeli Company Mobilitec Ex Libris Storage XMPies HotBar InsureWork MedImpulse nLayers Eldat ProActivity Celletra Industry Communications Enterprise Software Communications Enterprise Software Internet Enterprise Software Medical Devices Enterprise Software Communications Enterprise Software Communications Value of Acquisition 75 62 55 54 52 50 40 30 20

17. June 2006 17 Potential Co-operation Human Capital Large Markets for Israeli Products Capital for Israeli VC’s R&D and Innovative infrastructure Experienced VC Industry

18. June 2006 18 Спасибо за внимание