Israeli high-tech is on a record-breaking trajectory. Startups raised $8.6 billion in the first half of 2026, a 45% jump from $6 billion in H1 2025, according to a Poalim Tech and Dealigence report. But the number of deals dropped roughly 35%, a clear sign that capital is concentrating in larger, more mature companies, particularly in cybersecurity and AI.

The Week's Headliner: AppsFlyer's $1B+ Round

The standout story of the past week is AppsFlyer's mega-round: over $1 billion at a $2.7 billion valuation from Google, Meta, Unity, and Moloco, each taking a minority stake. The Tel Aviv–based ad-measurement platform plans to use the funds to build AI-powered attribution tools that help advertisers track digital ad performance independently.

The deal signals renewed confidence in the digital advertising ecosystem, which has been seeking independent alternatives amid years of privacy changes and cookie deprecation.

Dream Security: $260M at $3B Valuation

Dream Security, founded by former NSO Group CEO Shalev Hulio, closed a $260 million round at a $3 billion valuation. Co-led by Bicycle Capital and Group 11, with participation from Antler, Bain Capital Ventures, and Tru Arrow Partners, the company develops an AI-powered sovereign cyber defense platform for governments. It positions itself as a purely defensive tool, a deliberate departure from the controversial profile of NSO Group.

Engram: The 13-Employee AI Startup That Raised $98M

Engram, an AI startup building a "learned memory layer" for large language models, raised $98 million at a $600 million valuation with just 13 employees. Co-founded by Dr. Dan Biderman, who has Israeli roots, the round was led by Wiz co-founder and CEO Assaf Rappaport, with participation from General Catalyst, Kleiner Perkins, and Sequoia Capital.

Autobrains: The Israeli Startup Driving Uber's Munich Robotaxi

Autobrains, an Israeli AI company, announced a partnership with Uber and NVIDIA to launch autonomous robotaxis in Munich. Announced in early June, the program uses the NVIDIA DRIVE Hyperion Level 4 platform and plans to begin test rides pending regulatory approval.

The Other Side: Amdocs Cuts in Israel

Not all news is upbeat. Amdocs, the telecom software giant, began layoff proceedings in Israel as part of a global 7-10% workforce reduction. An estimated 300-400 Israeli employees are affected. The restructuring, overseen by new CEO Shimie Hortig, is aimed at reorganizing around AI and data.

The Big Picture

H1 2026 continues a streak of rising capital rounds that began in late 2025. The Israel Innovation Authority's 2026 report, published last month, revealed record high-tech exports of $85 billion in 2025, 58% of Israel's total exports. The sector now accounts for 18.3% of GDP and drives roughly half of the country's economic growth.

But the declining deal count alongside rising dollar amounts tells a story of investor selectivity. Money is flowing, but it's flowing to proven companies, not necessarily to early-stage startups.