Multinational Corporations - Contribution to the Israeli Tech Eco-system

December 2020

REVIEW BY IVC RESEARCH CENTER

Overview in Numbers

• 387 active multinationals in Israel in 2020.

• 137 IT & Enterprise Software active companies – the leading sector with the highest number of MNCs.

• Leading Sub-Sectors: Enterprise Applications, Security, Industrial Technologies and Mobile Applications.

• Approx. 68,000 employees are employed by MNCs in Israel.

• Leading cities in Israel with MNC presence: Tel-Aviv-Yafo, Herzliya, Petach Tikva and Haifa.

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Number of MNCs Established by Year: 2010–2020

• Number of active multinationals in Israel in December 2020 – 387.

• The last decade was significant for multinational corporation activity in Israel.

Data for 2020 is not final and is subject to change in the coming months as more information becomes available

215236 244

261

295

327348 346 351

375 387

26 30 23 32 40 42 4115 24 33

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2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

# of Active MNCs # of Established MNC's

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5333

2928

2319

121212

1010

98

7666666

Enterprise Applications

Security

Industrial Technologies

Mobile Applications

Medical Devices

Business Analytics

Biotechnology

Digital Health

Enterprise Infrastructure

Miscellaneous Software

Design & Development Tools

Agrotech

Online Advertising

Enterprise Networking

Online Entertainment

Video, Image & Audio

Broadcast

Content Delivery Platforms

Mobile Infrastructure

Manufacturing Equipment & EDA

Top Sub-Sectors - Active MNCs in Israel – 2020The four top technology verticals in MNCs in Israel are: Machine Vision, IoT,Artificial Intelligence and Cyber Security, similar to 2019 figures.

Source: IVC Data and Insights

Data for 2020 is not final and is subject to change in the coming months as more information becomes available

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MNCs by Sector: Established 2010-2020

1 3 1 14 2 1 2

87

6 5

7 109

45

3

5

10

3 4

710

2

3

5

5

9

7

5

12

14

14

21

7

9

15

3

1

2

3

7

3

3

3

1

3

3

2

1

1 2

3 3

1

2

2

1

5

1

23 2

3

1

1

2

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Cleantech Communications InternetIT & Enterprise Software Life Sciences Miscellaneous TechnologiesSemiconductors

Data for 2020 is not final and is subject to change in the coming months as more information becomes available

30%

30%

20%

20%

2020

Communications

IT & Enterprise Software

Life Sciences

SemiconductorsSource: IVC Data and Insights

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Notable MNCs - Established & Ceased in recent years81 Multinational Corporations opened new R&D activity in Israel between the years

2017 and 2020; 49 MNCs ceased to operate in Israel in the same period.

New MNCs Ceased MNCs

(an Intel company - 2017) 2018

(a Ribbon Communications company - 2020) 2020

(A Midea company - 2017) 2017

(a Contentsquare company - 2019) 2017

(a Nuvei company – 2019) 2018

(a Powerfleet company - 2019) 2017

(a NortonLifeLock company - 2017) 2019

(Attunity Ltd. – a Qlik company - 2019) 2017

(a Canon company - 2018) 2018

(a Perforce company - 2018)

(a ChemChina company - 2019) Source: IVC Data and Insights

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Number of Employees in Active MNCs in Israel – 2020• Most MNCs in Israel employ between 10 and 50 employees and serve as R&D centers for the parent company

abroad.

• The largest number of employees is in a manufacturing facility (Intel Fab in Kiryat-Gat) and not an R&D center.

23

163

62 5942

2110 1

Less than 10 Between 10 and 50 Between 50 and 100 Between 100 and 200 Between 200 and 400 Between 400 and 1000 Between 1000 and5000

5000 or More

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Number of Employees in Active MNCs in Israel – 2020Top 15 companies with the highest number of employees:

12,000 1,400

3,000 1,200

2,000 1,150

1,600 1,000

1,650 1,000

1,550

1,500

EmployeesEmployees

Source: IVC Data and Insights

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Number of Active MNCs in Israel by Location – 2020

• Of the 381 active MNCs operating in Israel in 2020, more than 41% have branches located in central Israel: TelAviv-Yafo, Herzliya and Petah Tikva.

• However, in terms of the number of employees, KiryatGat, with its Intel and HP manufacture facilities is much more significant.

# of Active MNCsMNC Location

115Tel Aviv

43Herzliya

33Petach Tikva

27Haifa

18Raanana

16Ramat Gan

16Netanya

15Caesarea

14Jerusalem

13Kfar Saba

12Rosh Haayin

12Rehovot

9Hod Hasharon

7Yoqneam

7Lod

109Other Source: IVC Data and Insights

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Number of MNCs by Country of Parent CompanyThe majority of MNCs in Israel are U.S. based corporations, accounting for 60% of the 381 companies.

227

18 1812 11 9 9 8 6 4 4 4 4 3 3 3 3 1 1 1 1 1 1 1 1 1

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The presence of US tech companies was trending historically around 50% of newly established MNCs per year. While there was a noticeable German presence in 2016 and Chinese during 2017, currently, there is no other country with any significant presence other than US, yet.

Newly Established MNCs by Country of Parent Company

13

1 1 2

2

23

113

131

2

42

32

1

11

2

11

1

2

2

1

1

1

3

1

1

1

27

24

22

8

16

18

8

3

1

6

2

4

2014 2015 2016 2017 2018 2019 2020

Canada China France Germany India Japan Spain The Netherlands United Kingdom United States Other Countries

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Foreign Corporate Investments* in Israeli High-Tech 2014–2020

*Each funding deal contains one or more investments according to the number of investors that took part in this transaction.**All corporate investments include Israeli & foreign corporate investments.***Data for 2020 is not final and is subject to change in the coming months as more information becomes available.

331 421 466 668 715 1098 1079484 557

863 749

13281148

900

1066

1200

16341733

2930

2801

4219

89

128 154191

239237

248

138

191 185223

295

234

251

442

531563

645

811

691726

2014 2015 2016 2017 2018 2019 2020

Foreign CVC Investments $m Foreign Corporates Investments $m Corporate Investments $m

# of Foreign CVC Investments # of Foreign Corporates Investments # of Corporate Investments

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MNCs M&A Activity in Israel: 2014–2020Most global companies acquiring Israeli startups are from the US, with a steady number of more than 50 exit deals each year

3 3 2 2 3 4 31 2 4 4 2 4122 1 1

1 1 12

22

11 7

142

11

7

1

4

3 3

1

1

2 11 2 1

1

1

1

1

2

2 1 2

1

1

12 1

31

2

1

122

2

27 9 5

3

45

47

56 58

58

56

70

45

5

2 2

7

1

3

2

2014 2015 2016 2017 2018 2019 2020

Canada China Denmark Finland France Germany Hong KongIndia Isle of Man Japan Luxembourg Singapore Sweden SwitzerlandTaiwan The Netherlands United Kingdom United States Other Countries

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Number of Israeli HT Companies with Overseas Activity137 active Israeli high-tech companies in growth stages (with over 300 employees) have opened several

branches overseas, most of them in North America and Europe.

* Overseas company activity derives from the geographic spread of a company’s branches

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2

35

13

46

58

1511

30

18

42

3

47

18

Africa Asia Central & South America Europe Middle East North America Oceania

Active Private Active Public

Active Israeli Tech Companies with Overseas Activity

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* Overseas company activity derives from the geographic spread of a company’s branches

104

59

41 4035 34 33

29 2724

1916 15 14 14 12 11 10 9 8 7

89

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