Early-stage VC firm Hetz Ventures just raised a $77 million fund focused on enterprise software as the pandemic fuels a massive appetite for AI and other emerging tech
- Hetz Ventures raised $77 million for a second fund dedicated to early-stage emerging tech startups, according to a Tuesday announcement.
- Overall, the Isreal-based venture capital firm has $130 million under management and has invested in startups like Trigo, Granulate, and Codota.
- The announcement is a reflection of the fact that, despite the economic headwinds caused by the coronavirus, enterprises are keen on investing in tech like artificial intelligence.
- "The crave for these types of technologies has quadrupled overnight," Managing Partner Judah Taub told Business Insider.
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Israel-based, early-stage VC firm Hetz Ventures has raised $77 million for a second fund to invest in enterprise software startups, according to a Tuesday announcement, signaling an enthusiasm for cybersecurity, artificial intelligence, and other emerging technologies despite the coronavirus crisis.
While sectors like oil and gas, airlines, and hospitality have been decimated by the fallout from the pandemic, the interest in enterprise technologies has accelerated, Hetz Ventures managing partner Judah Taub said.
"The crave for these types of technologies has quadrupled overnight," he told Business Insider. "We're seeing faster turnaround times. We're seeing things that we never saw before about large corporations opening up, making decisions swiftly, willing to take risks that they never did before."
The latest raise — Hetz' first since securing a $55 million fund in February 2018 — brings Hetz Ventures' overall funds under management to $130 million. Taub declined to name any of the investors in the latest round, but noted that Hetz is backed by "some of the very, very largest international institutions," along with "the most successful international entrepreneurs."
Hetz has already used the new funds to invest in two companies, but Taub declined to name them publicly. The firm has previously invested in 10 startups, including Trigo, Granulate, and Codota.
Trigo, an AI-backed startup that provides software to enable touchless checkouts, is valued at $69 million, according to PitchBook. Codota, which simplifies the coding process, is valued at $13.7 million, and computing optimization firm Granulate is valued at $9 million.
Cybersecurity, AI, and DevOps (a term that combines development and operations, and refers to tools that help engineers do their jobs more efficiently) are three technologies that are a particular focus for Herz, but Taub also said it has a deep interest in quantum computing. While still very early days, the technology has the potential to revolutionize industries like healthcare given its ability to process applications deemed impossible by today's standards, according to Taub.
"We're big believers in quantum providing big value down the line," he said. But "some of the quantum aspects, we're likely to see the fruits of it sooner than others."
Overall, Taub related the appetite for emerging tech like AI to the e-commerce revolution, arguing that the companies that invested early are reaping the rewards now.
"There's no question that AI holds the future," he said. "The question is how quickly we're going to get there and how quickly those who don't adopt AI and don't utilize its vast potential will fall behind."
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