TLV Partners: If Democracy Is Affected, Startups Will Flourish Elsewhere

Tel Aviv-based venture capital firm TLV Partners this week joined a raft of companies and entrepreneurs who warned that the judicial review planned by the new government of Benjamin Netanyahu was a threat to democracy and would undermine the thriving local technology industry.

“If Israeli democracy is undermined, the industry high tech shall wither–or flee abroad. The best brains will leave; Israeli entrepreneurs will establish their start-up outside the country’s borders, Israel’s rating will be affected (S&P [Standard & Poor’s] already announced that the planned reform could downgrade Israel’s rating), and so on,” warned the firm’s four partners – Rona Segev, Shahar Tzafrir, Adi Yarel Toledano and Eitan Bek – in a letter to the public.

“An entire industry that carries the country on its back will be forced to seek other places to flourish,” they wrote. “The damage to come will be enormous and will affect everyone without exception – the left, the right, the religious, the secular, the Arabs and the Jews.”

Get our free daily issue by email so you don’t miss any of the best news Free Subscriptions!

TLV Partners is a company founded in 2016 by two entrepreneurs and venture capitalists, Segev and Bek, who until then worked with the venture capital firm Pitango. They are joined by Tzafrir – formerly of Magma Venture Partners – as Managing Partner and Yarel-Toledano, also formerly of Magma, who has become Partner and Chief Financial Officer. So far, the company has raised nearly $1 billion, invested in at least 45 Israeli companies working in fintech, deep tech, healthcare, cybersecurity, and e-commerce, among others. Startups that have received funding from TLV Partners have raised more than $4 billion and employ more than 4,000 people.

The company’s portfolio includes medical imaging company Aidoc, insurance company Next Insurance, data technology start-up Datagen and Quantum Machines, which has developed a universal language for quantum computers and a unique platform that helps them operate. .

“The great flows of capital invested in our industry are its rays of sunshine and its waters”, explain the company’s partners. “But no flower can bloom on rotten soil.”

Funds raised by Israeli startups nearly halved last year, dropping to $15.5 billion from a record $27 billion in 2021, with funds coming mostly from Israel. This represented 18.64 billion of the total capital or 73% – a similar share to those registered in 2019 and 2020.

NICE Ltd. CEO Barak Eilam. (Credit: Screenshot: CNBC)

Earlier this week, Barak Eilam, CEO of Nice Ltd., a software provider in cloudswarned that judicial review would likely have irreparable consequences for Israel as a commercial hub that attracts investment.

The concerns raised by these prominent business figures come when Justice Minister Yariv Levin last week proposed a highly controversial overhaul of the country’s judicial system, which is expected to severely limit the Supreme Court’s ability to strike down laws and allow the Knesset to rule. – enact legislation previously overturned by judges. The reforms also include giving Prime Minister Benjamin Netanyahu’s government control of the commission responsible for selecting judges and would allow ministers to appoint their own legal advisers.

Proponents say the changes are necessary to rein in a judicial system they say undermines the will of the people, while critics say they will remove a critical check and balance on the legislative and executive branches.

“Israel’s technology ecosystem was built on freedom of expression and support for creative and innovative thinking. It flourishes in places where people have rights and freedoms – after all, what is the entertainment industry? high tech if not a mosaic formed by all those who work in this sector? These are the values ​​that the current government is trampling,” writes TLV Partners in the letter. “The initiatives that are being taken today and that aim to paralyze justice and dangerously disturb the balance between the different authorities are causing great damage to democracy”.

Critics of the reform also say it will remove all checks and balances that hold back the government and that endanger the rights of minorities and society’s most vulnerable populations.

“An unbalanced system is a dangerous system for everyone, whether collectively or individually. It is a dangerous system for the majority and for the minorities. It’s a dangerous system for right and left. And it is our duty to prevent this,” the TLV Partners post continued. “We say all this with a heavy heart and in great pain, and we remain hopeful that these actions of destruction are stopped before it is too late.”

You are one of our faithful readers!

That’s what we work for every day: to provide discerning readers like you with relevant media coverage of Israel, the Middle East and the Jewish world. Unlike many other media, our content is accessible for free – no paywalls from the first paragraph. But our work is proving to be more and more expensive. That’s why we invite readers, who can and for whom Israeli times in French has become important, so support us by joining the Community of Israeli times in French. For the amount you choose, once a month or once a year, you too can contribute to this quality independent journalism and enjoy ad-free reading.

Join the Community Join the Community Already a member? Sign in to stop seeing this message

Leave a Comment