Israeli Tech Sector Funding Remains Strong Amid Conflict
Despite the ongoing war, Israel's tech sector raised $775 million in February, its best fundraising month since 2022. The data suggests robust investor confidence in the nation's innovation ecosystem, showing that global capital remains focused on long-term value even amid significant regional instability.
The impressive February fundraising haul was not driven by mega-rounds, but rather a wide distribution of capital across numerous startups. This indicates a renewed investor focus on early and mid-stage companies. The largest investment in February was a $175 million round for Tomorrow.io, a company developing a satellite constellation to improve weather forecasting. Cybersecurity continues to be a leading sector for investment, with companies in this field raising a significant portion of the February total. Notable cybersecurity deals included a $120 million Series B for Vega, and a combined $61 million in seed and Series A funding for Gambit Security. Other key investments in this area went to startups like Orion, Reco, and Venice, all focused on different aspects of AI-driven security. This strong start to 2026 follows a record-breaking year for Israeli tech in 2025, which saw a total of $15.6 billion in private funding. The year was also marked by a staggering $71 billion in mergers and acquisitions, a nearly five-fold increase from 2024. Despite the high total funding in 2025, the number of individual deals actually fell to a decade low. This trend was driven by a concentration of capital in fewer, larger "mega-rounds," which accounted for approximately half of all private funding. The median private deal size in 2025 reached a record $10 million. The resilience of the Israeli tech sector is also reflected in its growing contribution to the national economy. In the first half of 2025, the high-tech sector grew by 5.2%, significantly outpacing the 2.0% growth of the overall economy. High-tech exports have climbed to represent 56% of Israel's total exports. January 2026 also saw a strong start to the year, with Israeli startups raising over $1 billion. This was largely driven by major funding rounds for cybersecurity companies, including a $250 million Series B for Upwind and $150 million for Claroty.
