Israeli Tech Funding Hits Four-Year High
Israel’s technology sector raised $775 million in February 2026, its strongest month in four years. The capital influx signals continued investor confidence in the country's innovation ecosystem, particularly in cybersecurity and AI, despite its wartime footing.
February's impressive fundraising total followed a strong start to the year, with Israeli startups raising over $1 billion in January 2026. This brings the total for the first two months of the year to $1.85 billion, indicating a significant rebound after a period of slower investment. For comparison, Israeli tech companies raised $10.7 billion in all of 2025. The month's funding was distributed across 23 disclosed rounds, with a notable absence of the mega-rounds that characterized parts of 2025. This broader allocation of capital suggests a renewed investor interest in earlier and mid-stage companies across various sectors critical to AI adoption, including enterprise data infrastructure and biotech. Leading the pack in February was weather intelligence platform Tomorrow.io, which secured $175 million to build out its satellite constellation. In the dominant cybersecurity sector, Vega raised $120 million in a Series B round, bringing its valuation to approximately $800 million. Other significant cybersecurity deals included a $56 million round for Gambit and $32 million for Orion. This strong performance in early 2026 builds on a resilient 2025, where Israeli tech firms raised a total of $15.6 billion. That year was marked by a concentration of capital into fewer, larger deals, with about 70% of funding going to cybersecurity and AI startups. The median deal size in 2025 reached a record $10 million. The influx of capital occurs even as the nation contends with the economic effects of an extended conflict. The tech sector, which accounts for about 17% of GDP and over half of exports, faced challenges including massive employee call-ups to reserve duty. However, the war has also spurred innovation in areas like defense technology, attracting further investment. The government has also taken steps to bolster the tech ecosystem, with initiatives like the "Yozma Fund" helping Israeli venture capital funds complete their fundraising and planning to continue investing throughout 2026. This support, combined with strong international investor confidence, particularly from the U.S., has been crucial.
