While in the past two years we have seen fewer Israeli companies pursuing an IPO on NASDAQ, US President Donald Trump’s reelection may reverse this trend.
For Israeli companies seeking to expand internationally, listing on NASDAQ offers a significant strategic opportunity. Its status as one of the world’s leading stock exchanges grants traded companies substantial advantages, from enlarging their potential investor base and significantly improving share liquidity, to opening new financing channels. The growing trend of Israeli companies choosing this route reflects the easing of regulations and the optimism regarding the future of the US capital market.
Many Israeli companies have previously chosen to list their shares on US exchanges, particularly NASDAQ, with the most prominent ones raising significant amounts and trading at high market valuations. Monday.com, which developed a leading platform for work management and collaboration, went public on NASDAQ in 2021, raised approximately $574 million, and currently trades (as of January 20, 2025) at a market value of about $12 billion.
In the cybersecurity sector, CyberArk, which went public in 2014 and is considered a global leader in information security, has a market value of approximately $17b. Fiverr, owner of the leading freelance services platform, went public in 2019 on the New York Stock Exchange, raised about $110m., and currently trades at a market value of approximately $1.22b.
Alongside these large companies, there are also smaller Israeli companies that have raised just tens of millions of dollars on NASDAQ, such as Rail Vision and Outbrain.
How to get listed on NASDAQ
Israeli companies seeking to enter trading on NASDAQ can choose one of three main routes: an initial public offering (IPO), a merger with a publicly traded shell company already listed on the exchange, or a dual listing that involves trading on both NASDAQ and the Israeli stock exchange. The choice of the appropriate route depends on the company’s characteristics, its stage of business development, and its long-term vision for the capital market.
The classic route for entering NASDAQ is through an IPO, which allows companies to offer their shares to the investing public for the first time. This process requires thorough preparation, including the drafting of a comprehensive prospectus, obtaining approval from the SEC (the American regulator), and implementing stringent corporate governance standards.
An alternative path to listing on NASDAQ is through a merger with a publicly traded shell company, which offers significant financial and operational advantages. This process allows the company to avoid the high costs of a traditional offering, while substantially reducing the timeframe required for completion. The success of this process requires thorough due diligence to ensure the chosen shell is free of liabilities and legal or financial risks.
The third option is dual listing, a process that allows Israeli companies to be traded simultaneously on the Tel Aviv Stock Exchange and on NASDAQ. Although this does not require a new public offering on NASDAQ, the company is still required to publish a prospectus.
However, this prospectus is relatively straightforward compared to US requirements, due to the similarity in disclosure and materiality standards. In addition, the financial statements require relatively few adjustments in order to be listed for trading in the United States.
In addition to the three routes offered above, companies also have the option to pursue a direct listing. This route, unlike a traditional public offering that raises capital by selling new shares, enables a company to register for trading based solely on its existing shares, without raising additional capital.
This process is especially suitable for companies already listed on stock exchanges outside the US, with substantial equity, positive operating results, and a high value of publicly held shares. A direct listing allows such companies to register for trading in the US to broaden their exposure to the American market, while preserving the flexibility to choose the timing of any future capital raising.
NASDAQ’s regulations share many similarities with those of the Tel Aviv Stock Exchange. This similarity serves as a solid foundation for technology, biomedical, and other industry companies aspiring to expand into international markets. NASDAQ, considered a leading arena for innovation and technology companies, provides Israeli companies not only with a trading platform but also with a prestigious status that demonstrates quality and reliability in the eyes of global investors.
The combination of regulatory similarity, significant growth potential, and high liquidity offered by NASDAQ presents a unique opportunity for Israeli companies. Whether it’s a young start-up seeking initial capital raising or an established company aiming to expand and strengthen its position in the international market, NASDAQ provides an ideal platform for achieving these goals.
Ilan Gerzi is a partner and the chair of the Israel Capital Markets and Securities Practice Group at Pearl Cohen Law Firm. Sahar Ezer is an associate in the Israel Capital Markets and Securities Practice Group at Pearl Cohen Law Firm.