Israeli Tech Funding Hits Two-Year High
Israeli technology companies raised $775 million in February, making it the strongest February for fundraising since 2022. The figure highlights the resilience of the country's startup ecosystem and its continued ability to attract global venture capital despite regional geopolitical shocks.
The February funding surge was led by weather-tech company Tomorrow.io, which raised $175 million to build out its AI-driven satellite network. This single deal, led by Stonecourt Capital and HarbourVest, accounted for over 22% of the month's total funding and aims to improve global weather forecasting by challenging aging government-run systems. Cybersecurity continued its reign as a dominant investment sector. Vega Security, a two-year-old startup, secured a $120 million Series B round led by Accel to challenge the dominance of traditional SIEM platforms with its AI-powered, distributed approach to threat detection. This brings Vega's total funding to $185 million. Another significant cybersecurity deal saw Gambit Security raise $56 million. Founded by veterans of the IDF's elite Unit 8200, the company's platform helps organizations map their systems to ensure they can recover from cyberattacks. The round was led by notable venture firms Kleiner Perkins, Spark Capital, and Cyberstarts. The investment trend reflects a broader market shift towards AI-native enterprise infrastructure, which some investors see as Israel's next major tech export. Startups that manage and structure the massive datasets needed to power AI also saw significant investment, highlighting the foundational nature of this technology for future growth. This strong start to 2026 follows a significant rebound in Israeli tech investment throughout 2025, which saw total funding reach an estimated $15.6 billion. The trend has been toward fewer, but larger and more strategic, funding rounds, with investors showing a clear preference for mature companies in high-growth sectors like cyber and AI. Investor optimism for Israeli tech in 2026 is high, with many seeing the ecosystem as having been strengthened by recent challenges. A survey of venture capitalists revealed that nearly all believe cybersecurity will continue to be the leading investment sector, closely followed by artificial intelligence. The influx of capital is not limited to local investors. Foreign VCs, particularly from the US, played a dominant role in 2025, accounting for 60% of total investors. This trend of strong international participation has continued, with global firms like Accel, Kleiner Perkins, and Spark Capital leading some of February's largest rounds.
