Google’s $32B Wiz deal is just the beginning: Tel Aviv’s startup ecosystem is evolving
Corporate investment has reached record levels, raising new questions for the city’s future.
Tel Aviv has long been a magnet for venture capital and technological innovation, but a new report underscores a fundamental shift in the forces shaping its startup ecosystem. While venture capital remains a critical driver, multinational corporations are playing an increasingly dominant role in funding, talent development, and acquisitions, reshaping the city's trajectory as a global technology hub.
A study by Dealroom and Tel Aviv Global finds that corporate involvement in the city's tech sector has reached unprecedented levels. Over 180 multinational companies, including Microsoft, Google, Amazon, and NVIDIA, operate R&D centers in Tel Aviv, drawn by its dense concentration of technical talent. This corporate presence is not just a passive endorsement of the city's innovation culture; it is actively fueling the next wave of technology growth.
Corporate venture capital (CVC) now represents a major force in Tel Aviv’s funding landscape. In 2024, corporate-backed rounds accounted for 24% of all investment in the city’s startups, a figure that surpasses most other global tech hubs. Meanwhile, 83% of Tel Aviv’s scaling startups have secured investment from corporate sources, signaling a deepening integration between multinational firms and local entrepreneurs.
This dynamic has far-reaching consequences. The infusion of corporate capital provides stability in a volatile funding environment, particularly as traditional venture capital investors recalibrate following a global market downturn. Moreover, multinational R&D centers act as incubators for talent, with many of Israel’s most successful startups founded by former employees of tech giants. Wiz, acquired by Google for $32 billion, was built by veterans of Microsoft, while ex-Meta engineers have launched companies such as Noname Security, NOKOD Security, and Mentee Robotics.
The city’s corporate-startup symbiosis is particularly evident in mergers and acquisitions. Tel Aviv ranks third among EMEA hubs for corporate acquisitions of venture-backed startups since 2019, with U.S. cybersecurity and software giants among the most active buyers. Israeli companies such as Check Point, Playtika, IronSource, and Wix are also acquiring aggressively, further embedding Tel Aviv’s technology ecosystem in the global economy.
In 2023 and 2024, the city saw a wave of significant acquisitions, including WalkMe’s $1.5 billion sale to SAP, SuperPlay’s $700 million acquisition by Playtika, and NVIDIA’s $700 million purchase of Run:ai. Several deals, such as Plarium’s $620 million acquisition by MTG and GetSat’s sale to Thales, have led to the establishment of new R&D centers in the city, reinforcing Tel Aviv’s role as a launchpad for corporate-backed innovation.
Despite its successes, Tel Aviv’s growing reliance on corporate capital raises questions. While the involvement of multinational firms strengthens the ecosystem, it also shifts the balance of power. A city once celebrated for its fiercely independent startup culture is increasingly shaped by the strategic interests of global corporations. Whether this trend leads to greater resilience or a loss of entrepreneurial autonomy remains an open question.
