By Emily Rose

Israeli Innovators Enhance Defense Technology

JERUSALEM (Reuters) – Israeli army reservist Zach Bergerson saw fellow soldiers struggling to detect enemy drones. To address this, he developed a high-tech wearable device called SkyHoop, which uses mobile technology to alert troops to aerial threats. Leveraging his civilian tech expertise and military experience, he aims to bolster Israel’s defense industry.

SkyHoop is currently being piloted in Ukraine, with potential trials discussed by the U.S. Defense Department. Amid ongoing efforts for a Gaza ceasefire mediated by U.S. President Donald Trump, Israeli startups like Bergerson’s are securing investments from American and Israeli venture capital firms, targeting the growing European market for defense exports.

Since the Hamas attack on October 7, 2023, which escalated the Gaza conflict, over one-third of defense tech startups registered with Startup Nation Central were founded. Israel’s recent military actions, including a 12-day air war against Iranian targets, showcased the effectiveness of its aerial defenses, intercepting 86% of missile launches, according to the Defense Ministry.

The evolving nature of warfare has resulted in changing global defense procurement demands. Western armies seek new, battle-tested technologies, with 20% of Israeli reservists employed in the high-tech sector. Investment in Israeli defense startups is increasing, driven by American venture capital firms that traditionally avoided the sector due to perceived risks and regulatory challenges.

Lital Leshem, a reservist who co-founded Protego Ventures, shared that the fund raised approximately $100 million and aims to invest in around four companies by year’s end. She noted that reservists are creating companies to solve real battlefield problems. Despite challenges in scaling and regulatory issues, she believes Israeli entrepreneurs can thrive in the defense sector, similar to the nation’s cyber industry.

While U.S. markets were once viewed as prime targets for these startups, the focus is shifting towards Europe. With Trump urging European nations to increase their defense spending from 2% to 5% of GDP over the next decade, Israeli companies see opportunities for significant sales growth. In 2024, Israel’s defense exports reached a record $14.8 billion, with over 50% directed to Europe.

Despite calls to boycott Israeli arms, Reserve Brigadier General Yair Kulas noted that buyers prioritize quality in defense procurement. The ongoing Russia-Ukraine conflict is prompting European nations to enhance their military capabilities, further increasing demand for Israeli products.

However, the political implications are concerning, with growing calls for delegitimization of Israel amid civilian casualties reported in Gaza. More than 57,000 Palestinians have died since the onset of the conflict, raising uncertainty about future impacts on defense exports and relations.

Avi Hasson of Startup Nation Central compared the current surge of reservist-led defense startups to the technological revolution that led to smartphones. This innovation may compel major Israeli companies like Elbit, Rafael, and Israel Aerospace Industries to either acquire startups or accelerate their own technology developments.

“We are now in a different world,” Hasson remarked.