New data shows defense-tech firms dominating Israel’s hi-tech investment, with start-up funding tripling year-on-year.
Israeli defense-tech start-ups working with the Defense Ministry raised nearly $3 billion in the first six months of 2026, according to figures presented at the Haifa DefenseTech Start-ups and Investors Forum. The amount is three times the $1b. raised during 2025. During the same period, defense-tech and dual-use companies accounted for almost 30% of the $8.4b. in private investment in Israel’s hi-tech sector. Approximately 800 start-ups are currently fulfilling direct procurement orders for the ministry.
The forum, held this week at EY’s Haifa office and organized by HiCenter Ventures, Gornitzky GNY, and EY, brought together entrepreneurs, investors, and officials from the defense industry and security establishment. “Israel is rapidly transforming from a ‘Cyber Nation’ to a ‘Defense-Tech Nation,’” Ilana Averkin, head of Defense-Tech at HiCenter Ventures, was quoted as saying.
Nevertheless, she warned that start-ups should not try to build full end-to-end systems and compete with the primes, but rather “design the product as an independent, flexible, and agnostic component” that can be easily integrated into the platforms of defense giants like Lockheed Martin, Raytheon, or local players such as Israel Aerospace Industries (IAI), Elbit Systems, and Rafael Advanced Defense Systems.
Global conflicts in Ukraine, the Persian Gulf, Lebanon, and Gaza have contributed to increased demand for defense technologies, including from Israel. Participants at the event cited the ability of Israeli companies to upgrade systems during active combat as a factor drawing interest from foreign customers. Lior Hanuka, CEO of HiCenter Ventures, told the crowd that “following lessons from fighting in the Gaza Strip, in Lebanon, and in Ukraine, control of frequencies and the ability to disrupt GPS systems and drones has become a top investment priority.” (Read more)
