{"id":602267,"date":"2026-08-23T16:04:12","date_gmt":"2026-08-23T16:04:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/602267\/"},"modified":"2026-08-23T16:04:12","modified_gmt":"2026-08-23T16:04:12","slug":"its-now-or-never-why-investors-are-still-betting-big-on-israeli-tech","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/602267\/","title":{"rendered":"\u2018It\u2019s now or never\u2019: why investors are still betting big on Israeli tech"},"content":{"rendered":"

Israel\u2019s technology sector has spent the past several years operating through war, political uncertainty and an increasingly complicated geopolitical environment. Yet global capital continues to flow into the country, and some investors appear more convinced than ever that Israel can produce the next generation of global technology giants.<\/p>\n

For Ori Barzilay, partner at Team8<\/a>, the explanation is not that investors are overlooking Israel\u2019s challenges. They are watching how Israeli entrepreneurs perform under them.<\/p>\n

Interview with Ori Barzilay, partner at Team8 <\/p>\n

(video: Yaron Brener)<\/p>\n

<\/p>\n

Team8 recently announced it had raised $365 million in new capital, a substantial vote of confidence at a time when questions remain over Israel\u2019s economy, political future and ability to retain its best technology talent. \u201cIt\u2019s actually not despite this\u2014it\u2019s because of this,\u201d Barzilay told ynet Global\u2019s Sharon Kidon.<\/p>\n

According to Barzilay, years of disruption have transformed the Israeli technology sector\u2019s famous resilience from a slogan into something international investors can measure. \u201cGlobal investors are feeling about Israel the same sense of urgency that we\u2019re all feeling,\u201d he said. \u201cThey see how Israel and the Israeli founders and the whole ecosystem are able to deliver no matter what.\u201d<\/p>\n

A few years ago, he added, the industry frequently talked about Israeli resilience. Today, there is evidence behind the claim: major funding rounds, acquisitions and exits, alongside new startups continuing to emerge.<\/p>\n

That pressure may even be helping create a new generation of entrepreneurs. \u201cWe see this sense of urgency\u2014founders coming out of companies saying and feeling, \u2018This is the right time. For me, it\u2019s now or never,\u2019\u201d Barzilay said. \u201cEveryone wants to prove that this is our place and this is still the best technology hub in the world.\u201d<\/p>\n

The biggest question facing virtually every technology ecosystem today is artificial intelligence.<\/p>\n

The United States has established a commanding position around foundation models and the enormous computing infrastructure required to develop them. That has raised questions over whether Israel, traditionally a global leader in cybersecurity, semiconductors and enterprise technology, risks falling behind.<\/p>\n

Barzilay believes the answer lies in understanding where Israel\u2019s competitive advantage actually sits. Israel may not dominate the foundation-model layer, he acknowledged, but that does not mean it is out of the AI race. Instead, he sees an opportunity in the infrastructure and middleware needed to turn increasingly powerful AI models into technology that businesses can actually deploy at scale.<\/p>\n

Israel has been here before. During the rise of cloud computing, Israeli companies did not necessarily become the giant cloud providers competing with companies such as AWS. Instead, Israeli entrepreneurs built technologies around the cloud\u2014including infrastructure, cybersecurity, networking and other enterprise layers.<\/p>\n

Barzilay believes AI could follow a similar pattern. \u201cWe see a lot of infrastructure technologies like networking, virtualization\u2014things that historically Israel really played at the world-class level,\u201d he said.<\/p>\n

\"<\/a>\"<\/p>\n

Ori Barzilay <\/p>\n

(Photo: Yaron Brener)<\/p>\n

As enterprises move from experimenting with AI toward widespread adoption, new technical challenges are emerging around infrastructure, security, deployment and management. \u201cThis is where we see the Israeli talent coming again and playing at the world-class level,\u201d Barzilay said.<\/p>\n

The activity is already visible, he argued, both through large funding rounds and at the earliest stages of company formation.<\/p>\n

Another change may be even more important to investors: Israeli entrepreneurs are increasingly building companies intended to remain independent global businesses rather than simply become attractive acquisition targets.<\/p>\n

Historically, Barzilay said, Israel was known as an M&A powerhouse. Entrepreneurs developed valuable technologies and companies that were eventually acquired by multinational corporations.<\/p>\n

Over the past decade, that model has begun to change. \u201cWhat we\u2019re seeing is that Israel is able to deliver huge companies and build standalone companies that are actually built in order to stay\u2014not just being sold as an M&A,\u201d he said.<\/p>\n

That distinction matters because the economics of global venture capital increasingly reward enormous outcomes.<\/p>\n

Investors are not necessarily searching for companies capable of producing a $300 million or $400 million exit, Barzilay explained. They are looking for businesses that could eventually become worth multiple billions of dollars. \u201cI think Israel is exactly in this phase,\u201d he said. \u201cWe\u2019re just getting started in that sense.\u201d<\/p>\n

The amount of money pouring into AI has inevitably raised another question: Are investors identifying the next generation of technology leaders, or simply chasing an increasingly expensive trend?<\/p>\n

Barzilay acknowledges that capital is heavily concentrated.<\/p>\n

\u201cThere is certainly a lot of capital pursuing AI, cybersecurity and infrastructure investments,\u201d he said.<\/p>\n

One figure, he noted, illustrates the scale of the phenomenon: roughly 95% of capital is going into 5% of companies.<\/p>\n

That concentration suggests investors are making increasingly large bets on the businesses they believe could dominate newly created markets. \u201cThey\u2019re looking for the new winners in the AI era,\u201d Barzilay said.<\/p>\n

For Israel, the challenge is to prove that its companies deserve to be among those winners. The enormous checks being written into selected startups come with equally enormous expectations. Investors want companies capable of defining categories and eventually becoming global leaders.<\/p>\n

Barzilay believes Israel has the entrepreneurial and technological capacity to deliver them\u2014and that this explains the \u201chigh-conviction investments\u201d continuing to enter the Israeli market.<\/p>\n

Private capital alone, however, may not be enough to secure Israel\u2019s position in the AI economy. Barzilay argues that the government needs to think beyond supporting startups and focus on building an entire AI ecosystem inside Israel. That means attracting the global companies shaping the technology itself.<\/p>\n

Israel already hosts major research and development operations belonging to companies such as Intel, Microsoft, Meta and Apple\u2014investments that have helped develop generations of Israeli engineers and entrepreneurs. A similar strategy is needed for AI, he said. The government should consider incentives, including tax measures, designed to encourage leading AI companies and infrastructure players to establish significant operations in Israel.<\/p>\n

\"<\/a>\"<\/p>\n

Bringing the world\u2019s most important AI companies into the country would do more than create jobs. It could deepen the local talent pool, expose Israeli engineers to frontier technologies and eventually produce founders who leave those companies to establish startups of their own.<\/p>\n

There is another uniquely Israeli component to that talent pipeline: the military. Israel\u2019s globally recognized cybersecurity ecosystem was fueled in large part by veterans of elite technological units, most famously Unit 8200. Barzilay believes a similar pipeline must now emerge around artificial intelligence.<\/p>\n

\u201cWe need to continue and build this AI talent out of the army,\u201d he said, noting that investments in military AI capabilities are being made first for national security purposes but could ultimately have a significant effect on the civilian technology sector.<\/p>\n

The combination, he argues, could be powerful: AI expertise developed inside the military, multinational AI companies establishing a deeper presence in Israel, and the country\u2019s existing culture of startup creation.<\/p>\n

\u201cI think that will make this ecosystem thrive when you combine it with the startup talent that we still have,\u201d Barzilay said.<\/p>\n

For a technology industry that has spent years proving it can continue operating under extraordinary pressure, the next challenge is different. Israel no longer needs only to demonstrate that its tech sector can survive uncertainty.<\/p>\n

It needs to prove that, in the defining technology race of the coming decade, it can build some of the companies that win it.<\/p>\n","protected":false},"excerpt":{"rendered":"Israel\u2019s technology sector has spent the past several years operating through war, political uncertainty and an increasingly complicated…\n","protected":false},"author":2,"featured_media":602268,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[72,191,61,60],"class_list":["post-602267","post","type-post","status-publish","format-standard","has-post-thumbnail","category-entrepreneurship","tag-business","tag-entrepreneurship","tag-ie","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/602267","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=602267"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/602267\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/602268"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=602267"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=602267"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=602267"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}