Tel Aviv, July 10, 2025 — Startup Nation Central, a non-profit promoting the Israeli innovation ecosystem around the world, has released the 2025 Cybersecurity Spotlight based on data from the Finder business platform, highlighting Israel’s position as a global leader in digital security innovation. The report reveals that in 2024, private funding nearly doubled from 2023, reaching a level equal to 40% of the entire U.S. cybersecurity funding market, while European and Asian markets contracted. This outperformance underscores unwavering investor confidence in Israel’s unique innovation model, even amidst geopolitical complexities.
The spotlight features more than 500 active companies building next-generation solutions across AI security, cloud protection, secure enterprise browsers, and data posture management. Despite comprising just 7% of Israel’s 7000+ company-strong tech ecosystem, cybersecurity companies attracted 38% of all tech investment in 2024, signaling their strategic importance and growth potential.
The sector has experienced significant growth (86%) over the last 10 years, from 272 companies in 2014 to 505 in 2024, far outpacing the 36% expansion across the broader tech ecosystem during the same period. 60% of Israeli cybersecurity companies are in early stages, reflecting a strong pipeline of innovation. Yet the sector shows faster scaling, with 16% growth stages compared to just 7% in the broader tech ecosystem.
M&A is the dominant exit path: 11% of cyber companies are acquired early, while just 1% go public, far below the 4% public rate in other sectors. This points to early acquisition as the prevailing route to maturity.
The report segments Israel’s cybersecurity innovation across 12 key domains, from identity and endpoint protection to security operations and industrial systems. It also maps acquisition trends, funding benchmarks, and the growing influence of AI on both attack surfaces and defense tools.
“Cybersecurity is one of the most critical sectors in global tech, driven by escalating threats and the rise of AI and cloud technologies. As digital systems increasingly underpin how we live, work, and govern, the demand for resilient cyber solutions will only intensify. Israel is uniquely positioned to lead this transformation and shape the future of digital security”, said CEO of Startup Nation Central Avi Hasson.
“In 2024 and early 2025, the sector delivered strong performance, nearly doubling its funding from the previous year. Israel’s cybersecurity sector is scaling rapidly, showing a healthy distribution across early and growth stages, high M&A activity, and scalable organizational structures,” said Yariv Lotan, VP of Product and Data at Startup Nation Central. “Israel has firmly established itself as a global cybersecurity powerhouse, driven by deep-rooted military expertise, a robust innovation ecosystem, and strong investor confidence,” added Lotan.
Other key findings from the report include:
Strong growth indicators: Cybersecurity saw the highest concentration of growth-stage companies (16%) across Israeli tech, compared to just 7% in other sectors.
High scalability: 31% of cyber companies have more than 50 employees, reflecting a stronger scaling profile than the broader ecosystem.
Exit dynamics: M&A remains the dominant exit strategy, with 11% of cyber companies acquired, compared to 7% in the rest of the tech landscape.
Global focus: The ecosystem’s global-first approach, driven by elite military training and international CISO validation, remains a key differentiator.
AI security rising: Startups like Zenity, Aim Security, and Prompt Security are securing both infrastructure and AI systems, responding to emerging GenAI and agent-driven risks.
The spotlight also features commentary from investors and corporate leaders including Amit Karp (Bessemer) and Yair Snir (Dell Technologies Capital), who discuss how geopolitical shifts, AI proliferation, and enterprise security gaps are shaping new demand and consolidation opportunities as well as an interactive Israeli Cybersecurity Landscape Map.
Explore the 2025 Cybersecurity Spotlight
Startup Nation Central helps global solution seekers tackle complex challenges by giving them frictionless access to Israel’s problem solvers and their bold, determined approach to innovation. We call this Impatient Innovation. Our free business engagement platform, Finder, delivers real-time data and insights into Israel’s tech ecosystem, surfacing opportunities and connecting startups with investors, corporates, and governments worldwide.
