How Israel Has Emerged on the Tech Scene

In our own lifetimes, Israel has emerged as a major world player in tech startups. What makes Israel a Startup Nation? Learn more about the companies, VCs, events, and deals that are happening with Israel tech startups in the infographic below.

How Israel Has Emerged on the Tech Scene

In 2021, Israel received 28 times more capital flow than the U.S., on a per capita basis — solidifying its reputation as the startup nation

Israel’s Massive Startup Potential

• In 2022, Israel’s high-tech companies raised $14.95 billion through 663 deals
• In 2021, 57 Israeli companies went public and raised $4 billion — almost three times the $1.7 billion raised by IPOs in 2020
• Israeli cybersecurity startups raised $8.8 billion in 2021 — more than 3x the amount raised in 2020
• Invests 4.1% of GDP into R&D — 2X the OECD average
• Ranked #2 in the world for R&D expenditure per capita
• Ranked #3 in the world for number of AI and machine learning startups
• 1 out of 3 cybersecurity unicorns in the world is an Israeli company
• Hosts R&D centers for large companies like:
  • Amazon
  • Apple
  • Cisco Systems
  • Facebook
  • Hewlett-Packard
  • Intel
  • IBM
  • Google
  • Microsoft
  • Motorola
  • SAP
  • Samsung
• 84% of MENA’s total VC funding went to Israel  in 2021
• Tel Aviv
  • 7th largest startup ecosystem in the world (2022)
  • Patent count increased by 169% since 2021
  • $120 billion startup value (2022)
  • In 2021:
    • Startups raised $20 billion — 63% of national total
    • Gained 30 new unicorns (companies valued $1 billion or more) — total of 92 unicorns in 2022
  • Innovation centers established by companies like:
    • Volkswagen
    • Anheuser-Busch
    • Apple
    • Citibank
  • 7 years time to exit, compared to global average of 9.4 years
• World Venture Funding Per Capita With $1B+
  • 1st Singapore: $1,398 B
  • 2nd Israel: $959 B
  • 3rd Estonia: $915 B

Israel has created a haven for entrepreneurs and innovators through various government programs and tax incentives

Factors Driving Israel’s Business Success

• Many US VC firms have offices in Israel
• Israeli startup founders have moved headquarters to thriving US cities to tap into local investment
• Going public or selling to large US tech companies made Israeli companies attractive to VCs
• Small local markets and security threats forced Israeli entrepreneurs to operate globally
• Unit 8200 – elite cybersecurity intelligence unit produced a group of world-class cybersecurity experts with the talent to start companies
• Yozma, government program launched in 1983
  • Matched outside venture capital (VC) investment in an Israeli startup
  • Asked the VC firm to return its investment if the company had a successful exit
• 30+ grants and tax incentive programs for R&D, including:
  • Conditional grants
  • Reduced tax rates
  • Tax exemption
• $70 million program launched in January 2022 to promote entrepreneurship among Arab communities
• Employment Aid Programs
  • Wage subsidies for new employees range from 10-40% up to several years
• Intellectual Property Incentives
  • IP assets created in Israel or transferred to Israel qualify companies for reduced corporate, dividend, and capital gains tax rates
  • Angel’s Law offers tax benefits and deductions to single investors who invest in Israeli companies during R&D stage
• 40+ R&D grant programs for multinational companies, individual entrepreneurs, research institutions and NGOs offering:
  • Customized and comprehensive incentive toolbox
  • Innovation Labs programs that offer up to 50% deduction in R&D expenses for specific sub-sectors

The Abraham Accords, signed on September 15, 2020, normalized relations with the United Arab Emirates — and just a few weeks later — with the Kingdom of Bahrain

The Powerful Impact of The Abraham Accords

• Extended Israel’s economic relationships in the Middle East
• 150,000 new jobs could be created for the four signatories
• If the accords grow to include 11 nations, the impact could be:
  • More than 4 million jobs 
  • More than $1 trillion in new economic activity over a decade

1/10th of the world’s unicorns are currently from Israel

Notable Israeli Startups

• OverWolf
  • $150 million in funding
  • Provides third-party developers with the ability to create extensions and add-ons for computer games
  • Tens of millions active users generating tens of millions of dollars in annual revenue
• Torq
  • $78 million in funding
  • Builds code-free automation used by security and operations teams
  • Allows security teams to build complex solutions in a visual interface
• Justt
  • $70 million in funding
  • Simplifies credit card payment disputes for businesses
  • Helps businesses deal with credit card companies and banks
• TytoCare
  • $155 million in funding
  • System enables comprehensive remote testing and medical monitoring of patients in their homes
  • Provides opinions from expert doctors around the globe
• Ermetic
  • $97 million in funding
  • Cloud security platform that reveals circumstances putting data at risk
  • Allows users to implement zero trust and least privilege access across the multi-cloud infrastructure
• Waze
  • $67.1 million in funding
  • Navigation app that helps users avoid traffic
  • Used by over 140 million drivers and riders
• Mobileye
  • $515 million in funding
  • Hardware and software providing driver assistance and cloud-enhanced driver assistance through cameras, chips, sensors, and mapping technology
  • Developing technology to create a future of autonomous driving
• Onavo
  • $13 million in funding
  • Mobile intelligence service that empower business decision-makers with market intelligence data
  • Acquired by Meta Platforms (formerly Facebook)
• PrimeSense
  • $39.4 million in funding
  • Leading developer of of 3D sensor technology that allows digital devices to observe a scene in 3D
  • Used by Xbox 360 video game consoles and iPhone Face ID
  • Acquired by Apple in 2013 for $350 million
• Staircase
  • $4 million in funding
  • Customer Intelligence Platform
  • World’s first AI responder
• Wiz
  • $900 million in funding
  • $10 billion valuation in 2023
  • Cybersecurity firm specializing in security for cloud infrastructure
  • World’s most valuable cybersecurity unicorn

OurCrowd 10th Annual Global Investor Summit

• 9,034 people registered from 81 countries.
• 943 entrepreneurs. 
• 1,084 MNCs.
• 111 delegations.
• 300+ press.
• $2.1B in commitments.
• 380 portfolio companies.
• 42 funds around the world.  

“Israel has dominated all sectors of technology for decades and will continue to do so far into the future. Yes, there are challenges, but the Israeli tech ecosystem will continue to thrive and change the world.”

Hillel Fuld – tech journalist, startup advisor, and ambassador of Israeli tech

With a history of incredible innovation, Israel is associated with a number of influential people, according to the Influence Ranking Engine at AcademicInfluence.com

People You Should Know

• Yossi Vardi
  • Israeli entrepreneur and investor, known for the DLD Conference
  • For over 47 years he has founded and helped to build over 85 high-tech companies in a variety of fields, among them software, energy, Internet, mobile, electro-optics, and water technology
• Gil Shwed
  • Israeli software engineer and entrepreneur
  • Co-founder and CEO of Check Point Software Technologies Ltd, one of Israel’s largest tech companies and world’s largest pure-play cybersecurity company
• Daphne Koller
  • Israeli-American computer scientist specializing in machine learning, AI, computer vision, and computational biology
  • Launched online learning platform Coursera in 2012 and served as Co-CEO with Andew Ng
  • Won the MacArthur Fellowship award in 2004
• Avi Wigderson
  • Israeli mathematician and computer scientist
  • Herbert H. Maass Professor in the school of mathematics at the Institute for Advanced Study in Princeton, New Jersey
  • Received the Abel Prize in 2021 for work in theoretical computer science
• Yoelle Maarek
  • Tunisian-born Israeli computer scientist
  • VP of Worldwide Research at Amazon
  • Researcher in the field of search engines and data mining
  • First engineer of Google Israel and established the company’s first development center in Haifa in 2006
• Joseph Klafter
  • Israeli chemical physics professor
  • Heineman Chair of Physical Chemistry at Tel Aviv University
  • 8th President of Tel Aviv University from 2009 to 2019
  • Won the 2020 Israel Prize in the fields of Chemistry and Physics
• Andrei Broder
  • Distinguished scientist at Google focused on understanding users, places, content, and actions using Machine Learning, Text Analysis, and Information Retrieval techniques
  • Interests include Discrete Algorithms, Operations Research, and Market Algorithms

Israel’s drive for innovation is undeniable and only time will reveal its full impact on global entrepreneurship

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