Israeli high-tech exits surge to $13.4B in 2024 amid sobering market realities
Israeli high-tech exits surge to $13.4B in 2024 amid sobering market realities
Despite the ongoing war and a global environment of soaring interest rates—perhaps even because of them—the past year (up to December 8) has seen a 78% surge in the value of exits by Israeli companies.
“The Israeli high-tech paradox”, that’s how the accounting and consulting firm PwC Israel describes the state of exits in 2024. Despite the ongoing war and a global environment of soaring interest rates—perhaps even because of them—the past year (up to December 8) has seen a 78% surge in the value of exits by Israeli companies. The total amount reached $13.4 billion, compared to $7.5 billion in 2023. These figures are impressive even when measured against 2021, a historic record year for Israeli high-tech. Excluding IPOs, the value of company sales in 2024 represents a 9% increase over 2021 as well.
According to Yaron Weizenbluth, Hi-Tech Partner and Assurance Leader at PwC Israel, 2024 appears to be the best year for mergers and acquisitions in the last decade. PwC’s methodology does not include follow-on transactions—secondary sales of public companies whose initial exits were already counted. Including such deals, like the sales of WalkMe and Innovid for a combined $2 billion, the total value of exits climbs to $17.2 billion.
"Against the backdrop of the war and amid internal and global challenges, the Israeli high-tech industry demonstrates recovery signs in 2024, showing significant upward trends in both average deal size and total transaction values," said Weizenbluth. "However, we must address the evident paradox in the local tech sector, stemming from international macroeconomic conditions that impact the local economy, leading to a sobering reality check for both investors and entrepreneurs. Consequently, the 2024 exits landscape reflects an evolving approach characterized by a balance between pragmatism and strategic maturity. Entrepreneurs and strategic buyers are seeking to generate value while weighing various risks, such as forgoing the chance for potentially higher future returns."
Weizenbluth’s comments come as the IPO market on Nasdaq remains largely dormant, despite earlier expectations of renewed activity in the latter half of 2024. Current projections now anticipate a revival of high-tech IPOs in late 2025. Companies are also reconciling with the reality that the valuations achieved during the boom years no longer reflect market conditions. This is evident in deals like those of WalkMe and Innoviid, which sold for significantly lower valuations than their IPOs in 2021.
Another notable trend is the rise of “blue-and-white” transactions—deals where both the acquirer and the target have strong Israeli ties. These accounted for approximately 28% of all transactions in 2024. A prominent example is the sale of the cybersecurity startup Dazz to decacorn Wiz, though Wiz notably rejected a $23 billion acquisition offer from Google earlier this year.
Large-scale transactions were relatively scarce in 2024, with the billion-dollar mark surpassed only twice. The first was the sale of the mattress company Resident, an essentially American firm, and the second was the acquisition of enterprise software company Own by Salesforce. By comparison, 2023 saw only one billion-dollar transaction.
In terms of deal size, 2024 saw eight significant transactions exceeding $500 million, totaling $6.8 billion—up from three deals worth $3.1 billion in 2023. The mid-sized range of $100–500 million dominated, accounting for 44% of total transactions with 23 deals amounting to $5.8 billion. Cybersecurity and artificial intelligence led the pack, representing 11 and four deals, respectively.
Despite the war and a downgrade in Israel's credit rating, American buyers remain prominent in the local ecosystem, accounting for 31 transactions, or 58% of the total, worth an estimated $8.9 billion. Israeli buyers followed with $3.2 billion from 15 deals, while European buyers contributed $951 million from nine transactions.
The IPO market, however, continued to struggle, with only six IPOs completed—up from three in 2023. Of these, one was held in Tel Aviv, with the rest taking place in the U.S. The total value of IPOs fell sharply, down 70% to $781 million from $2.5 billion in 2023, while the average issuance value dropped 85% to $130 million. The largest IPO in 2024 was by Gauzy, valued at approximately $320 million.
