Israel Hits Record with $10.5 Billion in Startup Acquisitions

Israel has achieved a record-breaking $10.5 billion in startup acquisitions, showcasing the country's thriving tech ecosystem. This milestone highlights Israel's growing influence in the global innovation landscape, with significant investments and strategic acquisitions across various sectors. The surge in acquisitions signals strong market confidence and reinforces Israel's reputation as a hub for cutting-edge technology and entrepreneurial growth.

More than 200 venture capitalists, investors, and entrepreneurs gathered in Tel Aviv on Thursday for the 2024-2025 Trends and Forecasts conference.

The event was organized by Pearl Cohen, a law firm, and Fusion VC, a U.S.-based venture capital firm and accelerator for Israeli startups. The conference featured various surveys and reports focusing on Israel's startup ecosystem.

In 2024, Israel's mergers and acquisitions market reached a record-breaking $10.5 billion, marking the country's best year yet. Israeli startups secured $8.1 billion in funding, as detailed in a report by Asaf Horesh, managing partner at Vintage Investment Partners. This success comes despite ongoing economic challenges in Europe and the U.S., as well as Israel's ongoing multi-front war.

The report showed a decrease in the total number of deals from 682 last year to 434 this year, but the total funds raised increased to $8.1 billion, up from $7.3 billion. The rise in funds raised despite fewer deals suggests that successful startups managed to secure larger investments.

A study by Fusion VC found that 43% of investors cited political and security instability as their primary concern, while 38% highlighted challenges in raising funds for new VC ventures. Many investors also expressed concerns about attracting foreign investment amid the ongoing war, which has deterred potential international investors.

"There is concern that Israel's tech ecosystem is too focused on cybersecurity, with insufficient attention to consumer-focused companies. This limits Israel’s ability to build large-scale consumer businesses," said Fusion co-founder Guy Katsovich. Alongside surveys, reports, and discussions with leading investors, the conference also featured a talk by Danny Gold, head of MAFAT (Directorate of Defense Research and Development) and creator of Israel's Iron Dome.

Israeli defense technologies have proven their value during the ongoing war, and Israel's air defense and cybersecurity sectors are attracting growing interest from foreign buyers and investors.

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Source: business-standard‍