Israeli startups secure $3.15 billion funding despite economic uncertainties

In the first five months of 2025, Israeli startups attracted a cumulative funding of $3.15 billion, marking a significant financial achievement in Israel’s technology sector amidst global economic uncertainties. This figure reveals a noticeable decline compared to previous years, particularly when contrasted with the $9.58 billion raised in 2024, which in itself was a drop from the astounding $15 billion collected in 2022 and the record $25.6 billion seen in 2021. In May 2025 alone, startups raised $550 million, a stark decrease from the more than $1.4 billion that was raised in May 2024, fueled by a landmark $1 billion funding round from the company Wiz. Major deals contributing to the May funding included significant contributions from several companies across diverse sectors. AI21 Labs garnered $300 million in a Series D funding round, while Classiq, a quantum software company, received $110 million in Series C funding. Other noteworthy investments were made in maritime tech, grief support, cybersecurity, and financial technology. These seven substantial deals constituted over 85% of the total funding for May 2025, highlighting a trend that showcases the concentration of investment in select high-profile startups. Despite the overall decline in funding, Israel's technology ecosystem demonstrates a robust appeal to investors, particularly in fields like artificial intelligence, quantum computing, and cybersecurity. This resilience suggests that even as the global investment environment continues to be cautious, Israeli startups remain capable of attracting significant capital. However, the trajectory indicates that the annual total for 2025 might fall below previous years' amounts unless there is a substantial recovery in funding activities in the upcoming months.