After two stormy and difficult years of prolonged war and uncertainty, it seems that the Israeli high-tech sector is preparing for a new chapter—a period of accelerated growth, investments and increased demand for Israeli technology.
If we compare the current situation to the post-COVID era, the picture is clear: after a deep shock comes a stage of recovery—and in Israel, as always, it happens with intensity.
Despite the complex reality, over the past two years, Israeli high-tech managed to keep the lights on and even break new records during the war. However, there’s no doubt that without the war, we would have seen even more investments and fundraising.
Now, after the end of the war with Iran and the significant weakening of other regional threats, we are likely to see the trend shift once again in a positive direction. Of course, all of this will happen fully only once the war in Gaza ends and all hostages are returned. This trend will grow exponentially with the expansion of the Abraham Accords.
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The indicators of change are already here, some even appearing before the war with Iran. The massive acquisition of Wiz by Google, eToro’s IPO and the strengthening of Israeli tech stocks—all signal a return of confidence in the Israeli market. Foreign venture capital funds are returning and exploring investments, mainly due to a combination of reasonable valuations and proven innovation. Some are even initiating collaborations or acquisitions after a period of partial withdrawal due to the security tension. Smart foreign investors want to get on the train now—before valuations rise.
Still, many in the sector warn against repeating past mistakes—particularly the 2021 bubble, where valuations disconnected from reality inflated the market and created an illusion that quickly burst, leaving investors and entrepreneurs high and dry. The emphasis this time will be on thoughtful building—profitability before growth, precise business metrics, a well-defined market and founding teams with experience.
Moran Chamsi Photo: Merav Ben LoulouUnlike the post-COVID recovery, which was characterized by euphoria, rapid fundraising and inflated valuations, the current period offers entrepreneurs an opportunity to internalize the lessons of recent years and build stronger companies. This time, entrepreneurs are expected to demonstrate disciplined financial management, present long-term business planning and operate according to principles of economic sustainability. The understanding that the market has changed—from hype-driven investors to depth-focused ones—enables a more realistic approach to pricing, forecasting and expectation management.
Moreover, the ecosystem’s overall maturity, alongside a rise in entrepreneurs with prior experience, promises more balanced decision-making and a focus on real value creation—not just the next IPO. If founders use the momentum to build strong organizational and financial infrastructure, they will not only lead the recovery but redefine the next generation of Israeli high-tech.
Is Israeli high-tech heading toward another rally? Probably yes, but this time, it will be a measured rally, grounded in business principles, accumulated experience and hard-earned lessons. And if we proceed wisely, it is entirely possible that from this crisis, a period of high-quality, focused and sustainable growth will emerge.
- Moran Chamsi is managing partner at Amplefields Investments.