Israel at 77: A high-tech nation defined by cyber, AI, and mega exits

The past year, since the 76th Independence Day of the State of Israel, has been anything but stable. Despite deep concerns arising from security threats, geopolitical challenges, and the global financial climate in 2024, Israel’s high-tech industry recorded some of its most significant exits to date.

At the forefront was Google’s negotiation to acquire Wiz, culminating in a $32 billion deal—making it the largest acquisition in Israeli tech history. Initially, Wiz declined a $23 billion offer, expressing a desire to grow into a major independent company. But a few months later, Google returned with an offer too good to refuse. Founder Assaf Rapaport and his leadership team ultimately accepted.

This landmark deal overshadowed other major transactions, such as Munich Re’s $2.6 billion acquisition of Next Insurance—one of the biggest exits in insurtech history—and SAP’s $1.5 billion purchase of WalkMe. Salesforce also acquired Own, underscoring continued global interest in Israeli cloud companies. At the same time, many firms, including Wiz before its sale, raised sizable funding rounds, with a strong focus on cybersecurity and somewhat less on artificial intelligence.

Israel’s identity is evolving from the “Startup Nation” into the “Cyber Nation.” While this shift once raised concerns, it’s now widely viewed as a strength. The adaptability of Israeli high-tech continues to draw the attention of global giants. One strong signal was Nvidia’s $700 million acquisition of Run:ai—one of the country’s most promising AI firms—proving that significant exits are also possible outside of cyber.

Yet, dark clouds are gathering over the industry. Global economic volatility and the unpredictable policies of Donald Trump—sworn in again as U.S. president in January—have led many tech firms to pause and reassess their next strategic moves. Just when it seemed high-tech was poised for another breakthrough, IPO plans stalled, including eToro’s. Venture funds hoping to raise new capital found that their limited partners had little cash to spare. As a result, much of the industry is holding its breath, awaiting clarity from the Trump administration.

Adding to the uncertainty are Trump’s isolationist policies and his drive to repatriate strategic industries. This shift has spurred many Israeli companies to incorporate in the United States rather than in Israel—not solely due to political instability at home, but also because American stakeholders increasingly prefer working with U.S.-based firms.

Despite Israel’s appealing tax benefits and ease of incorporation, many companies are recalibrating in light of the new geopolitical and economic realities. For firms that conduct most of their business in the U.S., being physically and legally present there is becoming an important competitive advantage—even for those with strong patriotic ties to Israel.

As Israel enters its 77th year, uncertainty reigns. Funding will continue to flow, especially into cybersecurity and AI, and notable exits are still likely. But for those anticipating blockbuster IPOs or new mega-funds, patience will be required. The fog of global instability must clear before the next leap forward.

this shift once raised concerns, it’s now widely viewed as a strength. The adaptability of Israeli high-tech continues to draw the attention of global giants. One strong signal was Nvidia’s $700 million acquisition of Run:ai—one of the country’s most promising AI firms—proving that significant exits are also possible outside of cyber.

Yet, dark clouds are gathering over the industry. Global economic volatility and the unpredictable policies of Donald Trump—sworn in again as U.S. president in January—have led many tech firms to pause and reassess their next strategic moves. Just when it seemed high-tech was poised for another breakthrough, IPO plans stalled, including eToro’s. Venture funds hoping to raise new capital found that their limited partners had little cash to spare. As a result, much of the industry is holding its breath, awaiting clarity from the Trump administration.

Adding to the uncertainty are Trump’s isolationist policies and his drive to repatriate strategic industries. This shift has spurred many Israeli companies to incorporate in the United States rather than in Israel—not solely due to political instability at home, but also because American stakeholders increasingly prefer working with U.S.-based firms.

Despite Israel’s appealing tax benefits and ease of incorporation, many companies are recalibrating in light of the new geopolitical and economic realities. For firms that conduct most of their business in the U.S., being physically and legally present there is becoming an important competitive advantage—even for those with strong patriotic ties to Israel.

As Israel enters its 77th year, uncertainty reigns. Funding will continue to flow, especially into cybersecurity and AI, and notable exits are still likely. But for those anticipating blockbuster IPOs or new mega-funds, patience will be required. The fog of global instability must clear before the next leap forward.