AI and defense power Israeli startup fundraising to nearly $1 billion in May
Israeli startups raised over $940 million in May as artificial intelligence dominated investment flows, while defense technology continued to attract major backing amid global tensions.
Israeli startups raised approximately $940 million across 17 funding rounds in May, underscoring the continued strength of two sectors that increasingly dominate the country's technology landscape: artificial intelligence and defense technology.
The month's largest deals reflected a market that has become highly concentrated around a handful of themes. Investors showed a growing willingness to commit substantial sums to companies building AI infrastructure, enterprise automation tools, cybersecurity platforms and military technologies.
The headline-grabbing transaction came from AI startup Decart, which raised $300 million at a $4 billion valuation in a round backed by Nvidia, with Amazon joining as a strategic customer. The funding placed Decart among Israel's most highly valued AI companies and highlighted investor enthusiasm for infrastructure capable of supporting increasingly demanding AI workloads.
Defense technology emerged as the second major driver of investment activity. Kela, a startup developing an operating system designed to integrate modern military systems, raised $200 million at a $1 billion valuation with backing from prominent international investors including Bill Ackman and Eric Schmidt. Meanwhile, Airis Labs, a secretive defense-tech company building an AI platform aimed at helping military organizations make sense of battlefield conditions, secured $60 million.
Several companies focused on building the infrastructure layer of the AI economy secured sizable investments. CopilotKit raised $27 million to expand its platform for AI agents, while NanoCo attracted $12 million for enterprise AI agents built around its NanoClaw technology. Tribal, founded by executives from Salesforce, Wix and Spot.io, raised $10 million to bring AI agents into complex enterprise environments.
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The trend extended beyond infrastructure into business applications. Unframe raised $50 million after surpassing $100 million in enterprise contracts, reflecting growing corporate demand for AI projects that move beyond experimentation and into production. Novella secured $21 million to automate insurance processes with AI-powered brokers, while Arito raised $6 million to build AI tools for finance teams.
Cybersecurity, a long-standing pillar of Israel's technology sector, also remained a significant source of investment. Frame, founded by former executives from Wiz and Team8, raised $50 million to modernize security awareness training as AI makes cyberattacks more sophisticated and convincing. Ocean added another $20 million to develop defenses against AI-driven email attacks using autonomous agents that analyze intent rather than traditional patterns.
Healthcare and biotechnology also featured prominently. NVision raised $55 million to expand from quantum MRI into quantum computing applications for drug development, while Phytolon secured $23.6 million to scale production of fermentation-based natural food color alternatives for the U.S. market.
Elsewhere, weather intelligence company Tomorrow.io expanded its Series F round with an additional $35 million, bringing total funding in the round to $210 million. Viewz emerged from stealth with $7 million to rebuild financial infrastructure, while Rep AI raised $6.2 million in a round notable for including Zendesk's first investment in an Israeli startup.
See the full list of May's funding rounds below. (The list includes all officially announced rounds above $5 million.)
28.5.26
Ecommerce AI company raises follow-on funding as retailers seek unified customer platforms
27.5.26
Airis Labs built an AI platform designed to make sense of battlefield chaos
26.5.26
Israeli biotech targets US market with fermentation-based alternatives to synthetic dyes
20.5.26
Team8-backed startup aims to bring agentic AI into complex organizational environments
Daniel Zahavi, who sold his first company to Comcast, launches a new startup with Levl co-founder Michael Estrin, focused on AI tools for finance teams
Open-source startup says its AI agents are already used by executives at Amazon, Google and Meta
19.5.26
The Israeli startup, founded by former Noname Security executives, says it has signed more than $100 million in multi-year enterprise AI contracts as companies race to move AI projects from pilot stages into full-scale deployment
The cybersecurity startup says its platform replaces legacy phishing defenses with AI agents that analyze intent, not just patterns
The Israeli startup bets on unified ledger to replace fragmented financial systems
18.5.26
New capital to accelerate DeepSky satellite constellation and agentic AI development
Amazon joins as a strategic customer as Decart expands its real-time AI infrastructure and world-model platform
14.5.26
The startup targets $150 billion E&S market still reliant on manual underwriting.
13.5.26
Abbott-backed healthcare startup aims to accelerate drug development using quantum technology
11.5.26
The Israeli firm aims to modernize security awareness training as AI makes cyberattacks more convincing and scalable
5.5.26
Led by ironSource founders, the startup is building an AI-powered engine for product growth
The Israeli defense startup is building an operating system to integrate modern military systems
The startup’s open standard has already been adopted by Google, Microsoft, and Amazon
