Israel ranks fourth globally in quantum investment as startups gain momentum
Israeli quantum companies raised nearly $500 million in 2025, accounting for about 9% of global private investment in the sector. A new report highlights the growth of the industry from five companies in 2019 to more than 20 today.
Despite the international backlash against Israel following the war in Gaza, the country is emerging as a significant player in quantum technology. A special report by the Israel Innovation Authority, prepared in collaboration with the World Economic Forum (WEF) and obtained by Calcalist, ranks Israel fourth globally in private investment in quantum companies. Israeli quantum firms raised nearly $500 million in 2025, accounting for approximately 9% of global private investment in the sector, or around 15% excluding the United States. Israel ranked behind only the U.S., the United Kingdom and Canada, up from fifth place based on 2024 data.
The report, titled The Israeli Quantum Ecosystem: How to Generate Breakthrough Innovation Through Targeted Investment, traces the industry’s rapid expansion over the past six years. The number of active quantum companies in Israel has grown from just five in 2019 to more than 20 today, while the sector’s workforce has expanded from approximately 50 people to around 1,000. The report says Israel has one of the world’s highest concentrations of quantum-industry professionals relative to its population.
The figures do not include fundraising in 2026, which is shaping up to be another strong year for the sector both globally and in Israel. According to the report, Israeli quantum companies raised a total of $1 billion between 2019 and 2025. Several local companies, including Quantum Art and Classiq, are now exploring Nasdaq listings through mergers with special purpose acquisition companies (SPACs), as Calcalist has reported. The prospect of major technological breakthroughs between 2027 and 2029 is adding to the urgency: companies may need access to much larger pools of capital to scale their operations and commercialize their technologies.
Unlike conventional computers, which process information using bits represented as either 0 or 1, quantum computers use quantum bits, or qubits. Through a phenomenon known as superposition, a qubit can exist in a combination of the two states. Together with other quantum effects, this can allow quantum computers to tackle certain problems that are impractical for conventional machines, although the technology remains at an early stage and its advantages depend on the task.
Israel’s quantum sector has also benefited from a coordinated national development effort. The National Quantum Initiative, launched in 2019, established dozens of laboratories, strengthened academic capabilities and built national infrastructure. To date, $413 million has been invested in the initiative, with funding from the Planning and Budgeting Committee, the Israel Innovation Authority, the Directorate of Defense Research and Development (MAFAT) and the Ministry of Science.
Public funding in Israel remains relatively limited by international standards, according to the report. As in much of the country’s technology sector, private investment has played a central role in driving the industry’s growth.
Many Israeli quantum startups emerged from academic research, particularly at the Technion and the Weizmann Institute of Science. The number of master’s and doctoral students studying the field at Israeli academic institutions doubled between 2017 and 2025. Technology transfer offices have helped turn university research into commercial ventures, while an established venture capital industry has provided a route from the laboratory to company formation and fundraising.
Another distinguishing feature is the nationwide nature of Israel’s quantum ecosystem. In larger countries, quantum companies often cluster in particular regions. Israel’s smaller geography, the report argues, enables close collaboration between companies and researchers, faster movement of talent and shared access to expensive infrastructure needed to develop the technology.
The defense sector is another potential source of demand. Its operational requirements can provide early feedback on emerging technologies and create opportunities to test applications in demanding environments, helping companies refine their products and identify practical uses.
The report’s authors argue that Israel should not seek complete technological independence in quantum computing. Instead, they recommend concentrating resources on areas where the country has a comparative advantage and working with international companies to fill technological and infrastructure gaps. Such a strategy, they suggest, could allow Israel to remain competitive without attempting to replicate the full range of capabilities being developed by larger economies.
