Article preview reprinted from Start-Up - June, 2009
Israel's Xenia Venture Capital is an early-stage technology incubator with an unusual model for getting medical technologies out of the nest and on the wing. Read more...
Xenia's Public-Private Blend Fosters Early-Stage Medtech
Article preview reprinted from Start-Up - June, 2009
Israel's Xenia Venture Capital is an early-stage technology incubator with an unusual model for getting medical technologies out of the nest and on the wing. Xenia is a publicly traded firm that invests in private start-ups with the assistance of government funding. The company began in 2003 with a franchise from the Office of the Chief Scientist in Israel. Faced with a glut of PhDs, and one of the world's most productive cultures in terms of inventing and patenting medical devices—Israel has the highest number of patents per capita—the OCS recognized that Israel was not as good at turning those ideas into strong companies. The OCS accordingly set aside start-up funding to be granted to accredited technology incubators.
Today, 20 incubators operate with grant money from the OCS and such privatized incubators account for more than 50% of the funding for all the new companies started in Israel. Xenia is one of only three such incubators that are publicly traded. With a focus on information technology and medical devices, Xenia CEO Anat Segal believes its unusual structure gives its early-stage portfolio companies access to capital; experienced management; transparency that encourages future investment; and perhaps most importantly, a model for value creation that's not necessarily focused on driving a company to an exit.
Segal, once an investment banker with Robertson Stephens working on the Evergreen Capital Fund and the former head of corporate finance at Tamir Fishman Group, founded Xenia. She was joined by several high-tech heavy hitters: Avishai Noam, the founder and CEO of NovaCom (Xenia's largest investor, both before and after the IPO) and NovaNet Semiconductor; Haim Mer, chairman and founder of the mobile telecommunications firm C. Mer Industries; and Eran Bendoly, the former CFO of NovaCom.
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