From taboo to boom: Inside Israel’s new defense tech gold rush
Israeli defense tech sees surge in investment and innovation at 2026 Tel Aviv Expo.
CTech at the Defense Tech Expo 2026
(Video: Daniel Campos)
The Defense Tech Expo 2026, held last week in Tel Aviv, highlighted a significant shift in the Israeli technology sector, as venture capital flows into a domain previously considered niche or "taboo" by many civilian investors. Following the events of October 7, 2023, the industry has transitioned from a period of rapid adaptation to a sustained "gold rush," driven by battlefield-proven solutions and a global increase in defense spending.
The Shift to "Battlefield-Proven" Technology
Industry leaders at the Expo noted that the intensity of recent conflicts has accelerated the development and deployment of autonomous and digital systems. A primary focus of the exhibition was the challenge of asymmetrical warfare, specifically the threat posed by low-cost drones.
- Acoustic Detection: Itay Nourian, CEO of Insignito, demonstrated acoustic sensors designed to detect the unique sound signatures of inexpensive drones that threaten high-value military infrastructure.
- Automation: Liad Tamir, CEO of Macushla, emphasized the goal of replacing soldiers in high-risk, routine missions through robotics, noting that the past two years have served as an "expediter" for integrating these technologies.
- Precision Fire Control: Companies like Smart Shooter are refining fire control systems that compensate for both shooter and target movement. Product Manager Yoav Galster noted that many developers are currently serving in active reserve duty, allowing for a direct feedback loop between the front lines and the R&D lab.
Digital Twins and Spectrum Dominance
The Expo also showcased the "virtual" side of modern warfare.
- Udi Shafir, CEO of Tiltan Software Engineering, presented physics-based simulations and "digital twins" used for precise mission planning and debriefing.
- In the electromagnetic arena, Shai Palti of Netline discussed the importance of spectrum dominance. His company, which conducts 80% of its business internationally, has seen significant growth both globally and within the local Israeli market as electronic warfare becomes a standard requirement for modern defense.
Dual-Use and Civil Security
Innovation has not been limited to the battlefield. Several firms presented technologies with applications for law enforcement and emergency medical services (EMS):
- Medical Innovation: Xmetix introduced the TAK710, the first automatic tourniquet, developed in response to the mass casualty events of October 2023. CEO Edan Razinovsky reported interest from international governments, including Australia, for use in public safety and mass casualty incidents.
- Rapid Identification: IDenta demonstrated single-use kits capable of identifying 30 types of drugs and 21 types of explosives. The company has collaborated with Dyson to integrate these kits into specialized vacuum nozzles for surface sampling.
Economic Outlook
The surge in innovation is reflected in the sector's financial performance. Israeli defense exports reached a record $14.8 billion in 2024, with early indicators suggesting that 2025 figures will meet or exceed that benchmark.
Menny Shalom, CEO of T3 Defense, characterized the current climate as a "defense era." He noted that defense cycles are typically long-term (5-10 years) and characterized by low price sensitivity, providing a stable, high-growth environment for investors and manufacturers alike.
