GuardKnox, an Israeli automotive cybersecurity company, has filed for insolvency, citing debts of 11 million shekels (US$3.06 million).

Founded in 2016, the company specialized in cybersecurity solutions for smart and autonomous vehicles.

Court documents reveal that GuardKnox’s financial issues worsened during the COVID-19 pandemic. The outbreak of the 2023 war in Israel caused investors to withdraw from a US$30 million funding deal.

The company owes 4 million shekels (US$1.1 million) to a transportation firm and 3 million shekels (US$833,000) in unpaid salaries to its 27 employees, who have not been paid for November and December.

In response, GuardKnox reduced salaries to 80% and cuts its workforce from 80 to 27 employees.

Despite filing for insolvency, the board has proposed a recovery plan to restructure finances and maintain minimal operations, pending court approval.