In the midst of Israel's ongoing conflict with Hamas in Gaza, 1948 Ventures has emerged as a potential catalyst for the nation's tech sector. The US-based venture capital firm, known for its commitment to innovation and impact, has expedited its launch to invest in early-stage Israeli companies with dual-use applications.
Founder Aaron Kaplowitz discussed the strategic decision, the sectors drawing the firm's attention, and the distinct challenges and opportunities associated with investing in Israeli tech during times of crisis.
Named in homage to the State of Israel's founding year, 1948 Ventures specializes in early-stage investments in Israeli companies with applications in both civilian and defense sectors. Operating with a target check size ranging between $100,000 and a million, the firm focuses on opportunities in pre-seed, seed, and post-seed stages.
"I realized that if I was going to have not just opportunities in my investment but the ability to make an impact, we had to move up the launch date to October," shared Kaplowitz, referring to the decision to expedite the launch after the October 7th attack on Israel.
Helping Israeli companies during difficult times
Since its early launch, 1948 Ventures has actively engaged with the Israeli tech ecosystem, meeting with 56 companies during two trips to Israel. Kaplowitz provided insights into the diverse sectors the firm is exploring, spanning cybersecurity, homeland security, robotics, UAV, and even med-tech companies with defense applications.
While specifics about deals remain undisclosed due to compliance restrictions, Kaplowitz emphasized the firm's focus on companies with immediate and urgent needs arising from the current geopolitical situation. Expressing optimism about investing in technologies addressing the most pressing challenges, he highlighted the potential for Israeli tech to lead the way in innovation post-conflict.
"I believe that Israel is going to be at the forefront of innovation for the next several years because of what the country is going through now," stated Kaplowitz.
The founder went on to encourage more US players to enter the space despite challenges posed by the ongoing conflict.
“Israel has a really long road ahead,” he admitted. “This isn't going to be a war that ends tomorrow. And the tech sector is really hurting. So my call to US investors is that there are really good investment opportunities in Israel right now. There's still amazing technology coming out. There are still amazing teams there that are working 24/7 on their solutions.”
One of the challenges mentioned by Kaplowitz is the need to deploy capital quickly while maintaining rigorous due diligence. 1948 Ventures aims to strike a balance between speed and thorough evaluation to ensure strong investments for their stakeholders.
“For me, the biggest challenge is holding the line on making the investment to make sure that I complete the due diligence process as thoroughly as it needs to be completed,” he explained. “The challenge is getting money quickly to these companies while also making sure the investment is as strong as possible for my investors.”
1948 Ventures stands at the intersection of innovation and urgency, leveraging its unique position to contribute to the growth of Israeli tech during challenging times. As geopolitical dynamics continue to evolve, the venture capital landscape in Israel remains dynamic, offering opportunities for investors willing to navigate the complexities of the region.