Israel Launches $60 Million Defense Tech VC Initiative to Boost Innovation
Israel Ministry of Defense
10/9/2025
The Israel Ministry of Finance, together with the Directorate of Defense Research and Development (DDR&D) in the Israel Ministry of Defense, has approached the Knesset Finance Committee to approve a state guarantee of up to approximately $60 million (NIS 200 million) for establishing dedicated venture capital funds focused on advanced defense technologies (Defense Tech). This groundbreaking initiative aims to strengthen Israel's technological, industrial, and security sectors, while creating critical supply chains and contributing to job creation and economic growth.
The joint initiative addresses dual challenges: a shortage of venture capital in high-production, high-risk defense sectors, and the urgent needs exposed during the current war and geopolitical changes. The move creates an innovative bridge between the defense establishment and entrepreneurs and technology companies, positioning the Israeli ecosystem, which has a proven advantage in defense innovation sectors, to become a global leader in Defense Tech while aligning with a broader international trend of governments investing public capital or creating incentives for private investment in defense technologies.
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