Alibaba Invests in Israeli Startups to Increase Cybersecurity Defense

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(For Chinese Version, please click here)

In December 2014, Chinese E-commerce giant Alibaba Group Holding Ltd. made its first ever investment in an Israreli startup. Two months after its first investment, in March 2015, Alibaba is investing in a venture capita firm JVP (Jerusalem Venture Partners), to work with Israeli cybersecurity startups and protect its payment system from hackers.

Alibaba’s investment comes after EBay Inc.’s PayPal agreed to buy JVP-backed startup CyActive Security for about $60 million. CyActive guards against potential cyber attacks by using algorithms borrowed from evolutionary biology. Alibaba wants to defend itself against cybersecurity threats as companies including Apple Inc. and Google Inc. seek to gain share in the mobile-payment industry.

JVP is in line with Alibaba’s mission to supporting innovation and startups. JVP is an international venture capital firm, which specializes in investments in startup companies, focusing on Digital Media, Enterprise Software, Semiconductors, Storage and Cyber Security, having raised close to a billion US Dollars across nine funds.

In the past, most of the companies and startups JVP invested come from Europe and the United States. JVP has never invested Chinese companies in the past. Mr. Haim Kopans, Partner & CTO of JVP believed that cultural, language and legal barriers hindered both inbound and outbound investment between Israel and China.

Cybersecurity is fast becoming one of the biggest marketplace challenges for Chinese E-commerce businesses and most pressing issues facing consumers today. Israel is building what Prime Minister Benjamin Netanyahu plans will be a global hub for technologies that defend against hackers. In the past five years, the pace of tech deals between Chinese and Israeli firms has been picking up, spurred by the efforts of both governments.

To contact the author on this story: Amit Ben-Yehoshua at +86 13761360176 or amit.ben-yehoshua@dachenglaw.com.

Amit Ben-Yehoshua is a dual citizen of the United States and Israel and is licensed to practice law in California and Israel. Amit has over sixteen years of legal experience and holds a Master Degree in Chinese law from Tsinghua University in Beijing. Amit is a co-founder of the Israeli Chamber of Commerce in China and the Israeli Chamber of Commerce in Shanghai and served as a member of their respective Board of Directors. Amit served as Senior Consultant for Dacheng Law Offices in Shanghai, China’s biggest law firm, and specializes in international investments between China, Israel and USA.  

 

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