🧠 Food for thought

Implications, context, and why it matters.

Cybersecurity’s outsized returns mask a narrowing investment landscape

• Cybersecurity raised $4.1 billion with a $20 million median deal size per Startup Nation Central preliminary 2025 data. It made up 58% of M&A value in Q3 2025, led by Palo Alto Networks’ $25 billion purchase of CyberArk (an identity-security company) 1.
• Investors now crowd into cyber because exits look predictable. In H1 2025, health tech and life sciences raised $630 million 2. For the year, healthcare posted the most deals at 152, which signals many small bets.
• Israel’s tech ecosystem now leans on one sector’s mergers and acquisitions (M&A) appetite. Cybersecurity delivers exits, while areas like health tech stay capital-starved despite deals.

Cloud and data infrastructure providers can target Israel’s 1,000 early-stage deep-tech firms

• About 1,000 early-stage deep-tech companies operate in Israel (startups built on science or engineering-heavy innovation), and 120 have raised over $100 million 3. Many AI and medical tech teams now need scalable infrastructure.
• Healthcare logged 152 rounds in 2025, the most 4. Immunai (an AI-driven immunology platform; $313 million raised) pairs well with cloud partners that offer Health Insurance Portability and Accountability Act (HIPAA)-compliant computing plus data management 4. Sight Diagnostics (blood-testing technology; $186.8 million raised) is another fit 4.
• Enterprise software vendors and Application Programming Interface (API) providers can move early because the median fundraising cycle from seed to Series A (the first major venture round) hit 35 months, which gives infrastructure partners a longer window to embed solutions before companies scale 2.