Israel

8 Israeli Fintech Unicorns to Keep an Eye On

Israeli fintech unicorns (those based in Israel as well as US-Israeli companies) have made a splash this year amidst soaring valuations, record-breaking fundraises and a number of SPAC listings as well.

This comes in the backdrop of Israel’s emergence as a fintech nation, with Tel Aviv becoming the fifth most popular city for fintech in the world.

Israeli-founded fintech companies raised US$2.3 billion in venture capital and private equity just in H1 this year. Of this, over US$800 million was raised by six Israeli fintech unicorns. The total funding represents a growth of 3x over the same period last year.

It also highlighted the dominance of payments in Israel’s fintech sector, much like its MENA neighbours. Payments startups contributed 35% of the total Israeli fintech funding in H1 2021.

But Israeli fintech unicorns have emerged in other spaces as well, including insurtech, payroll and SME financial management. Here’s a list of eight Israeli fintech unicorns to watch out for.

Israeli fintech unicorns

1. Rapyd

Year founded: 2016
Year of unicorn: 2019
Headquarters: London, UK
Founders: Arik Shtilman, Arkady Karpman, Omer Priel
Industry: Payments
Valuation: US$8.75 billion

Rapyd is a “fintech-as-a-service” that offers integrations with a global payments network. This includes payments, local and cross-border disbursements, a white-label ewallet and card issuance as well.

The company raised US$300 million in a Series E round in August this year. The round, led by Target Global, valued the company at US$8.75 billion. Other investors in the round included a mix of old and new investors – Fidelity Ventures, Altimeter Capital, Whale Rock Capital, BlackRock, Dragoneer, General Catalyst, Latitude, Durable Capital Partners, Tal Capital, Avid Ventures and Spark Capital.

2. Next Insurance

Year founded: 2016
Year of unicorn: 2019
Headquarters: Palo Alto, US
Founders: Alon Huri, Guy Goldstein, Nissim Tapiro
Industry: Insurtech
Valuation: US$4 billion

Next Insurance is an AI-based SME insurtech solution provider. It offers insurance for different classes of SME workers. Policies are backed by German multinational insurance company Munich Re.

Next Insurance raised a US$250 million funding round in April this year at a valuation of US$4 billion. The round doubled its previous valuation of US$2 billion, which it reached after a US$250 million fundraise in September last year. The round was led by FinTLV Ventures and Battery Ventures.

3. Melio

Year founded: 2018
Year of unicorn: 2021
Headquarters: Tel Aviv, Israel
Founders: Maton Bar, Ilan Attias, Ziv Paz
Industry: Payments
Valuation: US$4 billion

Melio is a B2B payments platform that provides digital payables and receivables management solutions for SMEs. Features of the Melio platform include automated reconciliation and digitised payment approval workflows.

The company raised a Series D for US$250 million in September this year, taking it to a valuation of US$4 billion. The round was led by Thrive Capital and General Catalyst, and came after a US$110 million Series C2 raised just in January this year (which resulted in a valuation of US$1.3 billion).

4. Papaya Global

Year founded: 2016
Year of unicorn: 2020
Headquarters: New York, US
Founders: Eynat Guez, Ruben Drong, Ofer Herman
Industry: Payroll
Valuation: US$3.7 billion

Papaya Global provides automated software for global payroll, payments, and HR management. Its cloud-based solution uses business intelligence and analytics to automate payroll, manage several employee types, and enable onboarding and workplace engagement.

In September this year, the company raised US$250 million in a Series D round led by Insight Partners and Tiger Global. The round was raised on the heels of a US$100 million Series C round in March that took its valuation to US$1 billion. The round was raised in March and was led by GreenOaks Capital Partners.

5. Tipalti

Year founded: 2010
Year of unicorn: 2020
Headquarters: San Mateo, US
Founders: Chen Amit, Oren Zeev
Industry: SME financial management
Valuation: US$2 billion

Tipalti offers a global cloud-based payables automation solution that helps to streamline accounts payables and payment management workflow on one platform. The platform’s features include supplier onboarding and vetting, tax and regulatory compliance, invoice processing, global payments, supplier payment status communications, and reconciliation and reporting.

Tipalti raised US$150 million in October last year at a valuation of over US$2 billion. The round was led by Durable Capital Partners, with participation from Greenoaks Capital and 01 Advisors.

6. Sunbit

Year founded: 2016
Year of unicorn: 2021
Headquarters: Los Angeles, US
Founders: Arad Levertov, Ornit Dweck-Maizel, Tal Reisenfeld, Tamir Hazan
Industry: Buy Now Pay Later (BNPL)
Valuation: US$1.1 billion

Sunbit provides a BNPL solution that is available both in-store and online, across locations including auto dealership service centres, optical practices, dentist offices and specialty health care services.

The company raised US$130 million through a Series D round in May this year. The funding round, led by Group 11, took the company’s valuation to US$1.1 billion. Other investors in the round included Zeev Ventures, Migdal Insurance, Harel Group, AltaIR Capital, and More Investment House.

7. HoneyBook

Year founded: 2013
Year of unicorn: 2021
Headquarters: San Francisco, US
Founders: Oz Alon, Naama Alon, Dror Shimoni
Industry: SME financial management
Valuation: US$2.4 billion

HoneyBook builds financial management tools for service-based SMEs. The company combines tools like invoices, contracts and project management features on a single platform.

In May this year, HoneyBook raised US$155 million at a valuation of over US$1 billion. The round was led by Durable Capital Partners. It then raised US$250 million in Series E round just this month, doubling it’s valuation to US$2.4 billion. The round was led by Tiger Global Management.

8. Earnix

Year founded: 2001
Year of unicorn: 2021
Headquarters: Givatayim, Israel
Founders: Sammy Krikler
Industry: Insurtech and banking
Valuation: US$1 billion

Earnix offers an AI solution that helps to provide rating, pricing and product personalisation services for insurance and banking enterprise customers. Its offerings include behaviour-based personalisation, real-time engagement, AI-based analytical pricing, and enterprise rating.

The company raised US$75 million in growth funding at a valuation of US$1 billion in February this year. The round was led by Insight Partners, along with Jerusalem Venture Partners, Vintage Partners, and Israel Growth Partners.