Israeli entrepreneurs are increasingly attracting foreign banks’ investments by offering innovative technologies.
The Santander InnoVentures fund, which has $100 million available to invest in the next two years, plans to make one or two annual investments in Israel.
Even though there are no Santander banks in Israel, the company has shown significant interest in Israeli technology. Santander has already made its first investment in an Israeli start-up, the MyCheck mobile payment solutions company.
Other banks, such as Citi and Barclays, have also started investing or mentoring start-ups in Israel due to the Jewish state’s expertise in security, big data analysis, and mobile communications.
Citi has invested tens of millions of dollars in Tel Aviv’s high-technology hub, while Barclays focuses on cyber security, the Bitcoin digital currency, and compliance solutions in Israel. Barclays has also initiated a program to mentor 10 Israeli start-ups.
“We realized…unless we go with open innovation rather than internally developed solutions, the way banks previously did, [then] banks will lose out to the technology companies,” Michal Beinisch, chief operating officer of Barclays Israel, told Reuters.