Israel’s technology ecosystem is no longer defined only by the number of startups it produces. More companies are reaching scale, multinational activity continues to expand and experienced founders are building new companies after acquisitions.
In an IsraelTech interview hosted by Yoel Israel, Hila Shitrit Nissim and Yariv Lotan of Startup Nation Central discussed this shift, the growing concentration of capital in established companies and the sectors that remain underdeveloped. They also explained how Startup Nation Central connects Israeli companies with investors, governments and corporate partners around the world.
The result is a more mature ecosystem, but not an evenly distributed one. AI and cybersecurity attract considerable attention, while younger companies in health tech, agrifood and other capital-intensive sectors face longer paths to customers and funding.
What You’ll Learn
- How Startup Nation Central maps and promotes Israeli technology
- Why Israel is developing from a startup ecosystem into a scale-up ecosystem
- What the “flight to quality” means for younger companies
- Why retaining and developing talent is Israel’s most important challenge
- Where Hila and Yariv see opportunities beyond AI and cybersecurity
- Why Israeli health tech has considerable potential but remains difficult to scale
- How acquisitions contribute to Israel’s next generation of founders
- What global companies are looking for when they approach Israel
Table of Contents
- How Startup Nation Central Supports Israeli Tech
- How the Finder Platform Maps the Ecosystem
- Why Global Companies Look to Israel
- Israel’s Shift From Startup Nation to Scale-Up Nation
- Why Early-Stage Companies Face a Harder Market
- Why Talent Is Israel’s Most Important Asset
- Where Israel Can Grow Beyond Cybersecurity
- Why Health Tech Has Not Yet Reached Its Potential
- How Acquisitions Produce New Founders
- How Israeli Culture Shapes Company Building
- Why Regional Partnerships Matter
- Key Takeaways
How Startup Nation Central Supports Israeli Tech
Startup Nation Central is an independent nonprofit that works with startups, multinational corporations, investors and governments. Its objective is to strengthen Israel’s technology ecosystem and connect Israeli innovation with relevant partners around the world.
Hila and Yariv described an organization that operates both physically and digitally.
Its Tel Aviv hub hosts meetings, delegations, community events and content creators. Startup Nation Central also conducts activities in the United States, Europe, Gulf countries and other international markets.
Its global partnerships and innovation diplomacy work use Israeli technology to develop commercial and regional relationships. Its research and data teams track activity across the ecosystem, while the Finder platform makes that information available online.
Startup Nation Central does not limit its work to one company stage or technology sector. It works with startups seeking customers, corporations scouting technology, investors evaluating opportunities and governments trying to understand Israel’s capabilities.
An Independent View of the Ecosystem
Hila emphasized that Startup Nation Central is not funded by the Israeli government. This independence allows the organization to work broadly across the public and private sectors.
Government bodies such as the Israel Innovation Authority may help create introductions, but Startup Nation Central also develops direct relationships with corporations, investors and other international organizations.
The organization’s position in the ecosystem gives it access to founders, companies and data. It can then use those resources to help an international partner understand the market or identify companies that address a particular need.
How the Finder Platform Maps the Ecosystem
Finder is Startup Nation Central’s free platform for exploring Israeli technology companies, investors, multinational corporations, accelerators, hubs and other ecosystem participants.
At the time of the interview, Yariv said it included more than 7,000 active technology companies conducting development activity in Israel. It also covered thousands of investors that had financed Israeli companies over the years.
The platform receives approximately 1.5 million different visitors annually, according to Yariv, with around 70% of its traffic coming from outside Israel.
How Finder Collects Its Information
Finder combines automated collection, company contributions and human verification.
Startup Nation Central uses AI-supported systems to find information and create or update company profiles. Companies can then claim their profiles and provide additional details directly. Yariv said more than half of the companies on the platform had claimed their profiles.
This combination allows Finder to operate as more than a static directory.
A company profile can connect with relevant reports, ecosystem maps and other material published by Startup Nation Central. Visitors can build watchlists, explore sectors and share collections of companies with colleagues or partners.
Startups can also use the platform to search for investors, potential customers and commercial partners without first contacting Startup Nation Central’s team.
Turning Data Into Introductions
The platform also supports Startup Nation Central’s direct relationship work.
When a multinational company wants to find Israeli solutions, the team can use Finder to identify relevant startups and create a tailored watchlist. Startup Nation Central may then arrange meetings, delegations or discovery events around those companies.
The same infrastructure supports corporate technology challenges.
Hila discussed an upcoming AI-on-device challenge being developed with Intel and other technology partners. The planned program would invite individuals and teams to propose applications for AI running on devices such as phones, laptops and drones, with a prize expected to be around $60,000.
The initiative reflected a broader objective: help international companies find technology while developing areas where Israeli teams can hold a meaningful advantage.
Why Global Companies Look to Israel
International companies approach Startup Nation Central for several reasons. They may be searching for a specific technology, a commercial partnership, an acquisition target or a location for a research and development center.
The organization helps those companies understand the Israeli market, identify relevant teams and arrange direct meetings.
Hila described the goal as making Israel impossible to overlook for anyone involved in global technology and innovation.
What International Partners Want to Find
Global companies commonly approach Israel looking for:
- Technologies that address a defined corporate need
- Startups that can become commercial partners
- Companies that may be suitable acquisition targets
- Local teams capable of supporting an R&D center
- Guidance on entering and operating within Israel’s ecosystem
The process is not limited to providing a company list. Startup Nation Central explains the wider ecosystem, identifies relevant sectors and introduces visitors to founders who can demonstrate their technology directly.
According to Hila, seeing the range of companies and technical capabilities available in Israel often changes how visiting executives understand the market.
Israel’s Shift From Startup Nation to Scale-Up Nation
Yariv argued that Israel’s ecosystem is becoming more balanced. Early-stage company formation remains important, but it now exists alongside mature private companies, public technology businesses and extensive multinational activity.
This does not mean Israel has stopped being Startup Nation.
As Yariv put it, there cannot be a scale-up nation without a startup nation. New companies remain the source of future growth, but the ecosystem now has more of the experience, capital and corporate infrastructure required to support companies beyond their earliest stages.
More Than $110 Billion in 2025 Activity
Yariv cited more than $110 billion in overall capital activity during 2025. That total combined mergers and acquisitions, public-market transactions and an estimated $17 billion in private investment.
He described the figure as almost four times the corresponding activity recorded in 2024.
These results followed two years of war, geopolitical tension and operational disruption. Yariv did not argue that the war caused the increase. He and Hila both said Israel’s performance occurred despite the war and may have been stronger without it.
The figures nevertheless indicated sustained confidence from international investors and corporate buyers.
Acquisitions Are Only Part of the Story
A large acquisition receives attention for its transaction value, but its effect on the ecosystem can continue for years.
An acquiring company may retain an Israeli team and establish an R&D center. That presence can expand through further investment, recruitment and additional acquisitions.
Yariv pointed to repeat acquirers as an important part of this process. One acquisition gives a multinational company direct exposure to Israeli talent. That experience can lead it to purchase other companies or increase its local operations.
Why Early-Stage Companies Face a Harder Market
The ecosystem’s overall strength does not mean that every Israeli startup has equal access to capital.
Yariv described a “flight to quality” in which investors concentrate more heavily on companies that have reached clear commercial benchmarks and demonstrated the ability to grow.
This can benefit later-stage companies with established customers, revenue and experienced management. It creates a more difficult environment for younger startups that still need time and capital to establish those results.
AI and Cybersecurity Receive More Attention
Companies operating in AI and cybersecurity have a clear advantage in the current market because investors and corporate buyers are actively searching for opportunities in those areas.
A small agritech company faces a different reality. It may need to conduct physical trials, enter several geographic markets and prove that its technology works across different agricultural conditions before it can demonstrate meaningful growth.
That requires capital, time and customer access. Without the immediate demand surrounding AI or cyber, the company may struggle to secure any of them.
The same challenge affects startups in several other sectors, particularly those involving hardware, regulation or long development cycles.
Public Opinion Could Affect Younger Companies First
Yariv also drew a distinction between global business confidence and public attitudes toward Israel.
Investment and acquisition activity in 2025 represented a strong business vote of confidence. However, deteriorating public opinion could eventually make it harder for Israeli companies to recruit, develop partnerships or reach customers.
Established companies may have enough relationships and resources to manage that pressure. Younger companies are more exposed because they are still trying to build their first international networks.
Why Talent Is Israel’s Most Important Asset
When Yoel asked what Israel most needs to strengthen its technology ecosystem, Yariv’s first answer was talent.
Israel must retain the people already working in the ecosystem, develop new technical and managerial skills and create conditions that make experienced professionals want to build their lives and companies in the country.
Retention Extends Beyond Compensation
Compensation and investment matter, but they are only part of the decision to remain in Israel.
Yariv pointed to education, academic research, public services and general quality of life as important factors. Hila added that investment in talent should begin in schools and continue through universities and professional development.
Israel also needs to bring more advanced AI research into the country. Yariv said the local horizontal AI sector was performing strongly relative to Israel’s size, but Silicon Valley remained a major center for foundational research and talent.
Retaining Israeli professionals therefore requires an environment where they can work on technically ambitious projects without leaving the country.
What Is Horizontal AI?
Horizontal AI refers to technology that can be used across multiple industries rather than serving one specific market.
Examples include models, semiconductors, edge-AI systems and other infrastructure that can support applications in finance, healthcare, industry or additional sectors.
Yariv said Israeli horizontal AI companies had attracted a larger share of funding and M&A activity than their proportion of the broader ecosystem might suggest.
He expects vertical AI adoption to grow as models become more reliable and Israeli companies apply them to specific industries and business problems.
Where Israel Can Grow Beyond Cybersecurity
Cybersecurity and business software remain two of Israel’s largest technology sectors. However, Hila and Yariv identified several additional areas with meaningful potential.
These include:
- Health tech and digital health
- Medical devices and biotechnology
- Fintech
- Industrial technology
- Semiconductors and robotics
- Retail technology
- Agritech and food tech
- Mental-health technology
- Edge AI and on-device computing
The opportunity in these sectors is not always reflected in current investment levels.
Deep Tech Requires Different Support
Deep-tech businesses cannot always follow the development model used by enterprise software companies.
Agricultural robotics provides one example. A robot designed to harvest fruit may need to be tested in South Africa during one season, South America during another and Europe later in the year.
The company must finance hardware development, international travel, field testing and entry into several markets before it can build repeatable revenue.
Yariv believes Israel could do considerably more in these areas, but the ecosystem needs investors and partners willing to support their longer paths to market.
Go-to-Market Remains a Challenge
Hila described go-to-market execution as a persistent challenge for Israeli companies, particularly those entering complicated international markets.
She also believes Israel has improved.
Israeli companies have developed stronger performance marketing, brand and go-to-market talent. Teams accustomed to limited budgets are often capable of finding creative ways to reach customers and demonstrate demand.
The next challenge is developing more executives who have already scaled companies in sectors beyond software and cybersecurity.
Why Health Tech Has Not Yet Reached Its Potential
Health tech contains the largest number of companies in Israel’s technology ecosystem, according to Yariv. Yet relatively few have reached a scale comparable with the country’s largest cybersecurity and software companies.
The issue is not a shortage of technology or founders.
Health companies require more time and money to develop. They may also need regulatory approval and access to medical institutions before they can enter their target markets.
Why Israel Has a Strong Health-Tech Base
Israel’s health-tech ecosystem draws from several established sources of expertise.
The country has significant life-sciences talent, a history of medical-device development and four major healthcare providers with extensive electronic medical information. These resources have supported the development of digital-health companies and clinical technologies.
Military and civilian medical needs have also contributed to innovation in medical devices and, more recently, mental-health technology.
Hila pointed to 8400, a network that connects Israel’s health ecosystem with international partners, develops talent and supports the sector’s global positioning. Startup Nation Central works closely with the organization.
The Commercialization Barrier
The harder task is entering hospitals and other medical institutions in the United States and Europe.
Each healthcare market has its own procurement processes, regulations and industry relationships. A company can build a valuable product in Israel and still struggle to understand how to sell it abroad.
Yariv believes this commercialization barrier has prevented many Israeli health-tech companies from becoming significant global businesses.
If the ecosystem can improve market access and develop more executives with relevant experience, health tech could become a much larger part of Israel’s technology economy.
How Acquisitions Produce New Founders
Acquisitions are often treated as the end of a startup story. Hila and Yariv described them as a source of future founders and executives.
After an acquisition, founders and employees may spend several years inside a multinational corporation. They learn how a large company operates, how international markets work and where existing products fail to meet customer needs.
Some later leave to create another startup.
Experience Shortens the Next Company’s Learning Curve
A repeat founder begins with more than an idea.
The founder may have a developed professional network, relationships with investors, experience managing R&D and direct knowledge of how corporate customers buy technology.
Hila cited the founders of Wiz as an example. Their earlier company was acquired by Microsoft, where they gained further experience before building another cybersecurity company.
The pattern extends beyond founders. Employees of acquired companies develop technical, managerial, marketing and commercial skills that they can bring to other Israeli businesses.
This is one reason multinational R&D centers matter to the wider ecosystem. They do not simply employ local talent. They help develop people who may later build or lead independent companies.
How Israeli Culture Shapes Company Building
Hila described the characteristic pace of Israeli founders as “impatient innovation for a restless world.”
The phrase refers to founders who are uncomfortable waiting for solutions to arrive, willing to work under severe constraints and less deterred by the possibility of failure.
Yariv connected this behavior to necessity.
Israelis grow up in an environment where they cannot assume that conditions will remain stable. Military service, regional uncertainty and repeated crises encourage people to act quickly, improvise and move beyond their comfort zones.
Resilience and Agility Are Different Strengths
Resilience allows a company to continue operating during disruption. Agility allows it to change its plans when the original approach no longer works.
Yariv sees both qualities across the Israeli ecosystem.
During the war, companies maintained operations while employees served in the reserves and families managed substantial personal pressure. On the civilian side, people also organized quickly to address urgent needs.
Those conditions were damaging, not beneficial. However, the ecosystem’s response showed global investors and corporations that Israeli teams could continue delivering under severe disruption.
Why Regional Partnerships Matter
Startup Nation Central’s global work extends beyond the United States and Europe.
Hila described the Middle East, particularly the countries involved in the Abraham Accords, as an important area for developing commercial and person-to-person relationships.
Activity slowed during the war but was beginning to return at the time of the interview.
Israeli Companies Need a Place in Regional Projects
Yariv expects the region to become increasingly important as governments pursue major infrastructure and supply-chain projects connecting Asia, the Middle East and Europe.
Israeli technology companies could contribute to these projects, but technical quality alone will not secure their participation.
A startup must often work through a large international integrator already involved in the project. It also needs government relationships, commercial partners and an understanding of how multinational infrastructure programs operate.
Startup Nation Central’s role is to help Israeli companies form those connections and secure a place within larger partnerships.
These relationships can also affect how Israel is understood across the region. Commercial cooperation gives international partners direct experience with Israeli founders and technology beyond what they encounter in the news.
Key Takeaways
- Startup Nation Central connects Israeli startups with investors, corporations and governments through its Finder platform and direct partnership work.
- Finder covers more than 7,000 active technology companies and receives most of its traffic from outside Israel.
- Yariv cited more than $110 billion in Israeli technology capital activity during 2025.
- Israel’s ecosystem now includes a stronger combination of startups, scale-ups, public companies and multinational R&D centers.
- Investors are concentrating capital in companies with stronger commercial benchmarks, making the market harder for young startups outside AI and cybersecurity.
- Retaining talent requires investment in education, research, public services and professional opportunities.
- Health tech has a strong foundation in Israel but faces regulatory, funding and market-access barriers.
- Acquisitions help develop repeat founders and executives with experience operating inside global companies.
- Israel has room to expand in health tech, agrifood, industrial technology, robotics, semiconductors and edge AI.
- Regional partnerships can help Israeli companies participate in major infrastructure and supply-chain projects.
Watch Hila and Yariv’s IsraelTech Interview
Watch Hila Shitrit Nissim and Yariv Lotan’s full conversation with Yoel Israel on IsraelTech for more on Startup Nation Central, the Finder platform and the sectors shaping Israel’s technology economy.
