Israel is “on par” with Silicon Valley, says Blackstone’s Yifat Oron
As Israel’s startup ecosystem matures beyond premature exits, a panel of private equity experts argues that PE is becoming increasingly pivotal in elevating Startup Nation toward fulfilling its potential for scale and growth.
Israel is “growing up,” said Yifat Oron, Blackstone’s Senior Managing Director. “We’re a decade, two decades after… Silicon Valley, but we’re catching up,” she continued. “We no longer sell companies early. We want to be rich. We want to be very rich. We want to be not niche companies. We want to be the leaders.”
Oron joined Rob Levy, Expert Partner at Bain & Company, and Yoav Hinman, Partner at Fortissimo Capital, on a panel moderated by EY Managing Partner Noam Canetti at Startup Nation Central’s MNC Summit 2025 to discuss why startups backed by private equity are scaling faster and stronger; an arguable “growth hack” for Startup Nation.
Canetti noted the growing role of private equity and suggested it will play an even greater part in funding Israel’s high-tech sector in the coming years. He said the past decade has nurtured a slew of large private Israeli companies now ready to scale and grow (many extremely profitable but unable to go public at former valuations), setting the stage for what he called “a huge opportunity for private equity.”
From the PE perspective, Oron explained that Blackstone, one of the world’s largest investment firms, “is not a tech investor; we invest in good businesses.” She said the resilience and long-term growth potential demonstrated by Israel’s business sector and culture make it particularly attractive for private equity investment, an environment that harbours, as she put it, “good businesses.”
“I tell my colleagues about what’s going on here throughout the war. They thought that I’m either lying or I don’t know how to read the math,” Oron continued. “But it’s resilient. It’s doing well, and our fundamentals are very good. We have a population that grows like crazy. We have the Startup Nation supporting other businesses, not just tech. And so as a country, there is a huge potential.”
For Fortissimo Capital, despite opportunities to do otherwise, Hinman explained that the firm is a steadfast proponent of this local potential. He said that when it comes to most of the Tel Aviv-based firm’s LPs, “the money comes from outside of Israel. So in many ways, we could have been an international buyout firm, but we are very much Israeli… we believe in the market here.”
Elaborating on the nuances that distinguish Israeli private businesses from those in the U.S., Oron highlighted the different approaches to leadership. “In the United States, if we have a very, very good company, we can find a very, very good CEO if we need to, and a very good CFO… This is very different, in my personal opinion, and hence our firm’s opinion, on the Israeli businesses,” she said.
“A lot of what Israeli businesses are built on is the founding team, which is not just the CEO, it’s a CEO and all the people he brought around him or her,” she continued, noting that in many cases this same team stays with the company through to its exit or IPO.
While this can pose a challenge for venture investors, who must decide whether the “24-year-old person who starts a business” can take the company all the way, Oron said the culture of stickiness often makes a company’s offering more compelling to private equity investors. “For us, when we look at a business, we want to see a business that’s whole... that has good management, a good CEO,” she said. “What we’re trying to see is one, how scalable could this be? Where do we come into play and help, and how do we potentially augment the management with talent from around the world or from Israel who can help them.”
Fortissimo, which has backed several of Israel’s leading private companies, including Stratasys (now public), Beewise and Priority Software, has forged its place through a focus on what it terms “special situations.” “It can be turnaround, it can be growth creation, it can be growth acceleration for us, and that is what we focus on,” Hinman said. “We look for the opportunity again, for that special situation. We call it ‘inflection point.’”
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Levy offered his perspective on the cultural traits that define the Israeli business environment. “Israeli innovation is driven by two terms: yalla and yihye beseder, and both of them are awesome,” he said. “‘Impatient’ probably defines how Israeli companies get creative, and this is the exact reverse of scale and growth.”
Levy, who advises global investors entering the Israeli market, described the local mindset as both a challenge and a strength. He explained that when private equity investors consider acquiring or investing in Israeli companies, one concern is how to work effectively with founders and management teams who, while independent, fast-moving and product-driven, can clash with the more structured, process-heavy PE model.
“Being completely honest, Israelis are known for not [being] willing to pay for anything,” said Levy. “So we want things for free, and we know every answer already, so we don’t really need you to tell us.”
“In the wise words of Steve Jobs, if you hire smart people, let them do the job,” he advised. “Find the right private equity that fits your model, and then listen to them, because that is the only way to take away some of the yalla and yihye beseder and make that into a formal way of working.”
Oron agreed. “The yalla and sababa... it works up to a certain point,” she said, noting that “this needs to be a very well-oiled machine. And if it’s not, it’s going to blow up in the face. And what I really appreciate with the Israeli entrepreneurs is that they do have a little bit of chutzpah, they are stubborn, but they’re also smart, and they learn fast.”
