The venture capital fund's strategy is to forge a partnership with one major investor from each industry.

Microsoft serves as a founding corporate affiliate to the fund, which has already raised about half the capital it is seeking.

"The goal of the Orion Fund is to actively seek out and identify Internet-related technology companies in Israel and provide them with the capital, ongoing assistance and strategic support to enable them to prosper," said Eyal Levy, Orion's managing partner.

"Support from major international technology players such as 3Com will enable these companies to focus key technologies, products and services for the next generation of the Internet."