Israeli high-tech funding and M&A gain in 2025 despite ongoing Gaza war

Funding Overview - Israeli high-tech companies raised $11.9 billion in the first three quarters of 2025, a 13% increase compared to the same period in 2024 [1][2] - The volume of funding was primarily driven by cybersecurity firms, despite a 22% decline in the number of deals, which totaled 569 [1] Mergers and Acquisitions - Mergers and acquisitions reached a record $71 billion in 2025, nearly five times higher than the same period in 2024 [2] - Significant deals included Alphabet's $32 billion acquisition of Wiz and Palo Alto Networks' $25 billion purchase of CyberArk [2][3] Economic Impact - The tech sector accounts for approximately 20% of Israel's GDP, 15% of jobs, and over 50% of exports [2] Quarterly Performance - In Q3 2025, Israeli tech firms raised $2.4 billion, a 9% increase from Q3 2024 but a 50% decrease from Q2 2025 [3] - The number of deals in Q3 contracted to 141, down 24% from Q2 and 38% year over year [3] Market Insights - The third quarter of 2025 indicated a market in transition, with slower funding and more selective investors, while M&A activity reached historic highs [4] - Fewer funding rounds were observed, but at record sizes, indicating confidence in scale-ready companies [4] - Global buyers are making significant investments in Israeli tech, particularly in the cybersecurity sector [4]