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Ok, we all know that things are not great with the economy and that VC firms need to be more careful with their spend, but if you read the TechCrunch article about it, you would think that call the VC firms in Israel are about to close down! Now I agree that if you are just launching your start-up or if you have a start-up with no revenue model, it could be a tough time to raise VC money, but that's not just in Israel, but anywhere in the world today. Now that doesn't mean you should not start a company, just be more innovative and build into your business plan the fact that you may not be able to raise serious capital from a VC based in Israel.

Here are some of the highlights: (TechCrunch)

• 92% of those surveyed predict at least 3000 people will be laid off.
• 92% also believe that companies who do not lay off employees will slash salaries.
• 74% predict that at least 10% of venture backed startups will be shutdown.
• 95% foresee harsh times in the fund raising department.
• 54% expect a slowdown in seed investments.
• 87% expect a decrease in company valuations.
• 26% are confident that commitments by limited partners will not be withdrawn, while 51% believe they might.

Personally I still feel that if you have the right idea with a proven revenue model and have shown that you can execute, then you still have a good chance of raising VC funds from an Israeli VC. But you should know that even if an Israeli VC won't invest in you, there are still plenty of VC's in the USA that has and will continue to invest in Israeli companies.