VC Survey 2026
“Sovereignty has become a commercial requirement, not just a political statement”
Flint Capital Principal David Feldman joins CTech to offer his outlook on the state of Startup Nation, from its rebranding as a stress-tested allocation to the roadmap for its next export engine, as part of the VC Survey 2026: The Next Leap.
“Sovereignty has become a commercial requirement, not just a political statement,” says David Feldman, Principal at Flint Capital. He notes that the move toward "sovereign" tech stacks is already apparent in recent capital flows, with cybersecurity alone capturing roughly 43% of all capital raised in Israel in 2025. “Founders are building systems designed to operate independently of hyperscalers, foreign supply chains, and fragile global dependencies,” he adds.
Following the turbulence of recent years and the stabilization of 2025, the Israeli tech ecosystem is entering a new era: The Next Leap. Feldman joined CTech to share insights for its VC Survey 2026, which invites prominent investors to discuss the topics, trends, and “leaps” expected in the year ahead.
Reflecting on how Israel’s identity has been forged on the global stage over the past few years, Feldman says that for LPs, the country “now looks less like optional alpha and more like a stress-tested allocation. Innovation is assumed; resilience is the differentiator.”
While Feldman maintains that Israel has the talent and early proof points for its place in deep tech, “scaling high-CAPEX ventures will require more dedicated growth funds, longer-duration capital, and closer ties to sovereign and strategic LPs.” Focusing on AI, he believes the real value for Startup Nation lies in the "picks-and-shovels" layer. “Israel’s advantage is not yet model training but system hardening, making AI reliable, governable, and resilient. By 2030, that stack will be Israel's next export engine.”
You can read the entire interview below:
Fund ID
Name of Fund: Flint Capital
Total Assets Under Management (AUM): ~$450m
Partners/Managers: Israel Office: David Feldman; Boston: Sergey Gribov
Notable Portfolio Companies (Active): Socure, Flo Health, Sensi, Cynomi, Cyolo, Antidote Health
Notable Exits: WalkMe, CyberX, Voca.ai. LoomSystems, AppSee, BlazeMeter
The Global Leap: How is the 'Israeli Tech' asset class being rebranded to global LPs in 2026? Are we shifting the narrative from 'Innovation' to 'Extreme Resilience'?
Yes, and it’s a material shift. The data shows capital deployment and exits rebounding meaningfully in 2025 despite prolonged geopolitical stress, which reframes Israel from a “high-beta innovation lab” into a market that consistently performs under pressure. Raising $11B across 428 deals and delivering $17.8B in exits, excluding several mega pending M&As, demonstrates institutional resilience, not just creativity. For LPs, this now looks less like optional alpha and more like a stress-tested allocation. Innovation is assumed; resilience is the differentiator.
The Deep Tech Leap: With the rising focus on hardware-heavy sectors (Defense, Climate, Quantum), is the Israeli VC model adapted to fund high-CAPEX ventures?
Partially, but not fully yet. The data shows clear movement up the capital stack, with A rounds migrating above $20M and a sharp rise in $100M plus rounds, which is necessary for deep tech. However, most mega-rounds are still concentrated in software, cyber, and AI rather than true hardware-first platforms. Israel has the talent and early proof points, but scaling high-CAPEX ventures will require more dedicated growth funds, longer-duration capital, and closer ties to sovereign and strategic LPs. The model is evolving, but it’s not done adapting.
The Sovereign Leap: Have the geopolitical lessons of recent years pushed Israeli startups to build independent, 'sovereign' tech stacks to reduce reliance on global platforms?
Absolutely, and you can see it indirectly in where capital is flowing. Cybersecurity alone captured approximately 43% of all capital raised in 2025, much of it focused on infrastructure, identity, and control layers rather than edge features. Founders are building systems designed to operate independently of hyperscalers, foreign supply chains, and fragile global dependencies. This is less ideological and more pragmatic: customers now demand autonomy, security, and continuity under extreme conditions. Sovereignty has become a commercial requirement, not just a political statement.
The Dual-Use Leap: Israel has mastered Defense Tech. Which civilian industry (e.g. Construction, Agri, Logistics) will see the biggest disruption from adapting these battle-tested technologies?
Logistics and industrial operations are the most underappreciated winners. Israel’s defense expertise in real-time sensing, autonomous decision-making, and edge AI translates directly into supply chain resilience, fleet optimization, and infrastructure security. We’re already seeing hardware-and-software hybrids funded at a meaningful scale in 2025, which signals early adoption beyond pure defense. Unlike agri or construction, logistics has both urgency and global buyers willing to pay for reliability under stress. That’s where defense DNA becomes enterprise-critical.
The Next Engine: Cybersecurity has been Israel's primary export engine for a decade. Which domain is best positioned to take the lead by 2030?
AI-native infrastructure, especially at the intersection of cyber, data, and compute efficiency. Generative AI already raised $2.75B in 2025, but the real opportunity is in the picks-and-shovels: secure data layers, orchestration, and control planes that make AI deployable in regulated, mission-critical environments. Israel’s advantage is not yet model training but system hardening, making AI reliable, governable, and resilient. By 2030, that stack will be Israel's next export engine.
Finally, what are 2-3 startups that, in your opinion, are likely to make a leap forward in 2026?
From Flint Capital's portfolio:
1. Vayu Finance – Vayu is perfectly positioned to ride the AI wave due to AI-native products blowing up traditional business models and turning revenue into a real-time, constantly shifting system. As usage-based and PLG models scale, revenue operations become mission-critical infrastructure, not back-office plumbing. Vayu is built for exactly that moment.
2. Bluebricks – Bluebricks is positioned to win big because AI is fundamentally breaking the assumptions of how cloud infrastructure was built. As AI workloads push clouds to their limits, the real winners will be the picks-and-shovels platforms that redesign how networking, performance, and scale actually work, and Bluebricks sits squarely in that critical layer.
