Three members of the senior investing team at Genesis Partners, a major Israeli venture firm, are stepping out with a new, early-stage fund of their own called F2 Capital.
For the unfamiliar, Genesis Partners’ portfolio companies have been acquired by the likes of Apple, IBM, Microsoft and Sapiens over the past decade, and have gone public on the Nasdaq exchange in the U.S. as well.
Some that may be familiar to U.S. tech professionals include the 3D sensing company PrimeSense which Apple acquired for a reported $360 million, and a newer startup called Seebo that helps corporations operating outside of tech, especially toy companies, to create smart, internet-connected products.
While Genesis Partners was a $600 million fund for growth-stage deals, F2 Capital, founded by Eddy Shalev, Jonathan “Jonny” Saacks and Barak Rabinowitz, is in the midst of closing a $50 million debut fund to back seed stage companies.
Limited partners in F2 are mostly family funds based in Israel, the U.S. and Australia, Rabinowitz told TechCrunch.
The newly spun out firm is taking over the management of an accelerator program that was also started by Genesis Partners called The Junction. Founded in 2011, the Junction used to focus on connecting entrepreneurs with their first big enterprise customers. HP Inc, SAP, MunichRe, Enel, and Tesltra are among the accelerator’s strategic partners.
Since 2011, the Junction’s program has evolved. It is generally modeled after the Israeli military selection process for elite units known as the “Gibbush,” according to a press statement from F2. Two hundred and fifty applicants pitch and only five companies enter the six month bootcamp program.
F2 now provides $100,000 of funding on a convertible note to those top five companies. The firm maintains an option to invest more in their later rounds.
Previous participants in the Junction have included: Appsflyer, Honeybook, Simplee, ClarityRay (acquired by Yahoo!), KitLocate (acquired by Yandex) and Moment.me (acquired by Wix).
The newly admitted batch of Junction companies includes:
- RegulusX: a firewall and antivirus solution for drones and other small robots.
- Convexum: a provider of counter-drone perimeter security.
- PrintCB: a developer of 3D printers that make circuit boards.
- TestCraft: a cloud-based quality assurance testing system.
- ClanPlay: a messaging app for gamers that synchs with in-game chats.
Rabinowitz told TechCrunch that outside of its deals from The Junciton, F2 Capital will not invest in any business to consumer apps, content or biotech companies.
Instead, the firm will focus on what VC’s are calling “frontier” technology today, or tech that’s beginning to transform existing industries or create new ones.
Rabinowitz said, “People sometimes think of frontier tech as hobbyist drones and VR games, the cool fun consumer stuff. But we are thinking about the cross-section of big data, AI and connectivity across multiple segments.”
More specifically, the investor said he’s looking for startups developing sophisticated insurance technology, technology that can improve the user experience and development of virtual reality and augmented reality products, drones that do more than take a picture, connected vehicles and cybersecurity.