Israeli defense-tech startups growing assault drones, defenses towards fiber-optic drones, and munitions of assorted sorts have turn out to be the pleasure of the Israeli trade because the combating dies down. Up to now, nevertheless they’ve primarily international traders: funds corresponding to Lux Capital, Sequoia, and Peter Thiel’s Founders Fund have invested in outstanding corporations within the sector corresponding to Kela and Covenant. Few Israeli traders have invested in them, aside from new, small funds corresponding to Protego Ventures, Kinetica Ventures, Aurelius Capital, and 10D. According to analysis agency IVC, solely 0.5% of the overall quantity of capital invested in Israeli startups has gone to Israeli defense-tech corporations.
A brand new Israeli enterprise capital targeted on the sector, based by Israelis who beforehand managed household workplaces, was unveiled yesterday. So far it has made 5 investments below the radar in younger Israeli corporations. The fund, Stratos Ventures, has raised $50 million out of a goal $80 million from an anchor investor – a British monetary establishment – and former senior figures in protection institutions within the US, Latin America, and India.
The fund guarantees entrepreneurs contemplating founding corporations within the sector, and those that have already taken their first steps, entry to the US Department of War, the US Defense Advanced Research Projects Agency (DARPA), US Central Command (Centcom), and personal US protection funds. The fund has a partnership with startup accelerator The LAB Miami, among the many founders of which is Israeli Ayal Stern.
Among the fund’s companions and advisors are a former head of the CIA who has not been named, Lieutenant General (ret.) Michael Barbero, a four-star common within the US Army who commanded the legendary a hundred and first Airborne Division, and Theo Williams, former head of portfolio growth at Salesforce Ventures.
Companies with an Israeli connection
The fund was based by three Israelis working in protection funding in household workplaces and funds. Rotem Yehuda Kakon served in elite IDF expertise items and headed Consensus Business Group, a UK household workplace managing $1.2 billion in property. He was one of many early traders in protection fund AWZ and in Israeli emergency communications platform Carbyne, which was bought to US firm Axon for $625 million. Between 2014 and 2019 Kakon was bureau chief for the minister of the financial system and the minister of environmental safety. He at the moment serves as a director of Xenia Venture Capital and Earth and Beyond Ventures.
Kakon was joined by Aviad Grinfeld, an skilled CFO and former CEO of Avnon Holdings, which additionally invested in protection corporations, and Daniel Fouzailov, a former companion in Paz Capital, an Israeli household workplace.
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Stratos focuses on funding in corporations within the pre-seed to seed levels with Israeli founders or a considerable connection to Israel. The intention is to take a position $2-4 million every in 15-20 corporations.
Published by Globes, Israel enterprise news – en.globes.co.il – on June 25, 2026.
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