Drivenets Employees to Share in $40-50 Million Payout
Translated & summarized from Globes by baba
Israeli communication server company Drivenets is facilitating a secondary share sale expected to yield $40-50 million for its employees. This move allows staff to cash in on their stock options before a potential IPO or acquisition, spurred by the company's growth in AI servers. Drivenets, founded 11 years ago, has seen its valuation soar, recently reaching $8.5 billion. The company projects over $1 billion in revenue in the next five years.
The story in 5 lines · by baba
- Drivenets employees will receive $40-50 million in a secondary share sale.
- The transaction allows employees to cash out before a potential IPO or sale.
- The company's expansion into AI servers has driven recent growth and valuation.
- Drivenets was recently valued at $8.5 billion, making it a top Israeli high-tech private company.
- The company expects to generate over $1 billion in revenue within the next five years.
Employees of Drivenets, an Israeli communication server company, are set to receive between $40 million and $50 million in a secondary share sale to a new institutional investor. This transaction will allow long-term employees who have converted options to shares, as well as senior staff, to access cash before a potential IPO or sale. The company's significant expansion into AI servers has driven this opportunity.
Founded 11 years ago by Ido Sussen and Hillel Kobrinsky, Drivenets is a veteran high-tech firm with over 500 employees. The company periodically conducts share sales to reward long-serving employees awaiting an exit. This is reportedly not the company's first secondary round; last year, a transaction involving investors like Pitango, Bessemer, and Harel sold 15% of investor shares to AT&T for $750-800 million, valuing the company at $5 billion.
Drivenets has gained momentum in recent years due to its entry into AI processing, attracting new clients and investors. This has positioned it as the third-highest valued private company in Israeli high-tech, following a funding round four months ago that valued it at $8.5 billion. The company develops communication routers using cost-effective chips that enable reliable AI data processing, competing with established players.
Following its expansion into AI, Drivenets anticipates accumulating at least $1 billion in revenue over the next five years. Key investors include Bessemer Venture Partners, represented by Adam Fisher, and Atreides, represented by Gavin Baker. New investors like AMD and Red Dot have joined, alongside existing ones such as Pitango and D1. The company has been profitable with positive cash flow for the past 18 months, securing over $1 billion in signed deals, with projections for the AI server networking market to reach $200 billion by 2030.