As defense tech evolves, Israel is leading the way, showing the world how bold, impatient innovation doesn’t wait—it pushes forward.

The Booming UAV and UGV Defense Market

Unmanned technologies are rapidly transforming defense operations by providing solutions that are smarter, faster, and more efficient. UAVs dominate the skies with their ability to gather critical intelligence, while UGVs navigate the most treacherous terrains with speed and resilience. The global UAV market was valued at nearly $32 billion in 2023 and is expected to surge past $91 billion by 2030, a testament to the growing importance of these technologies. UGVs, often deployed in high-risk environments, are becoming equally essential, demonstrating how unmanned systems are more than just a trend—they’re a paradigm shift.

These cutting-edge systems leverage advancements in artificial intelligence, robotics, and machine learning to operate independently, collecting real-time data, delivering precision strikes, and keeping human soldiers out of harm’s way. Countries across the globe, from the United States to Israel, are investing heavily in unmanned systems to enhance their military capabilities. The future is unmanned, and the possibilities are boundless.

Unmanned Aerial Vehicles (UAV): Israel’s Sky Dominance

UAVs have revolutionized modern warfare, replacing outdated reconnaissance techniques with swift, autonomous aircraft capable of complex missions. These drones, equipped with advanced sensors and AI-driven decision-making, serve as the eyes and ears of military forces worldwide. In Israel, UAVs are not just a tool but a symbol of bold, impatient innovation that has set global standards.

Israel’s UAV expertise has been honed for decades. What began as reconnaissance missions in the 1980s has transformed into a fully-fledged industry driving today’s global military operations. UAVs now carry advanced payloads for intelligence, surveillance, reconnaissance (ISR), and precise strikes, making them indispensable in any modern military strategy.

Key Israeli UAV Innovations:

• Elbit Systems: Known for its Hermes series, Elbit Systems is a leader in UAV design. The Hermes 900 stands out for its versatility, supporting a variety of missions with AI-enabled payloads that gather critical intelligence, making it a preferred system for global forces.
• Israel Aerospace Industries (IAI): The Heron TP, a high-endurance UAV, is a force multiplier. It combines strategic reconnaissance capabilities with the capacity for long-duration missions, from maritime surveillance to border security, highlighting Israel’s role as a global UAV powerhouse.
• Aeronautics Ltd.: With the Orbiter series, Aeronautics provides tactical UAVs designed for agility. The Orbiter 4 is a game-changer for real-time ISR and target acquisition, combining compact design with extended flight capabilities that meet the demands of today’s dynamic battlefields.

Israeli UAVs have been deployed in conflicts across the globe, proving their reliability and adaptability in diverse environments—from rugged terrains to dense urban areas. These systems don’t just perform—they lead.

Unmanned Ground Vehicles (UGV): The Digital Foot Soldier

While UAVs rule the skies, UGVs dominate the battlefield. These ground-based robots are engineered to perform vital tasks, from logistical support to direct combat. In dangerous environments where human intervention is risky or impossible, UGVs provide the solution. Whether navigating bomb-riddled terrains or transporting supplies, UGVs showcase the future of ground warfare—autonomous, reliable, and resilient.

Israeli companies are at the cutting edge of UGV technology, developing systems that are both agile and powerful. By incorporating AI and machine learning, these ground vehicles are able to autonomously navigate challenging landscapes, gather intelligence, and even neutralize threats, making them essential for modern military operations.

Key Israeli UGV Innovations:

• Roboteam: The Probot is a highly adaptable UGV, capable of handling a wide array of missions, including logistics, ISR, and explosive ordnance disposal (EOD). Roboteam’s focus on ease of use and rapid deployment ensures that their systems are mission-ready in seconds.
• IAI’s RoBattle: IAI’s RoBattle is designed to operate in complex combat scenarios. With its modular architecture, RoBattle adapts to different missions by integrating various payloads, whether it’s gathering real-time intelligence or engaging in direct combat support.
• General Robotics: The DOGO tactical robot takes urban combat to a new level. Equipped with a 9mm Glock pistol and real-time vision capabilities, this compact UGV is a formidable tool in close-quarters combat, proving Israel’s determination to push the limits of innovation in defense.

These UGVs represent the future of warfare—autonomous systems capable of handling the most hazardous tasks with precision and efficiency, ensuring that human soldiers remain safe while the mission continues unhindered.

Israel’s Commitment to UGV and UAV Technologies

Israel’s dominance in unmanned defense technologies—both in the air and on the ground—is a direct result of its determined, audacious approach to problem-solving. The country’s relentless drive to innovate, regardless of uncertainty or risk, has set it apart as a leader in UGV and UAV technologies. By pioneering systems that integrate AI, robotics, and autonomous capabilities, Israel is helping reshape the future of global defense.

At the heart of this success lies the unique mindset of “Impatient Innovation”—the drive to act swiftly, the boldness to defy convention, and the determination to deliver results. Israel’s unmanned defense systems, backed by a robust innovation ecosystem, are a testament to the country’s unwavering commitment to enhancing operational efficiency and global security.

Israel remains a beacon of innovation as the unmanned defense market continues to expand, driven by technological advancements and global strategic needs. Its cutting-edge UAVs and UGVs are not just leading the market—they are defining it, pushing the boundaries of what’s possible, and ensuring that the world’s defense forces are equipped for the challenges of tomorrow.

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Cyber defense landscape

Securing digital infrastructures is more critical than ever in today’s hyper-connected world. The inherent risk in digital transformation necessitates robust defense mechanisms. Recognizing the importance of cybersecurity early on, Israel has dedicated significant resources to developing robust defensive technologies designed to counteract increasingly sophisticated cyberattacks. 

These comprehensive technologies include advanced intrusion detection systems, encryption protocols, and secure communication channels, ensuring broad protection for governmental and commercial entities. However, securing investments in these technologies can be challenging for less developed companies. 

An article from Forbes discusses the rigorous investment landscape in the defense sector, including cybersecurity. Venture capitalists (VCs) in defense tech expect significantly higher returns compared to other sectors due to the high risks and long development cycles typical in the sector​​​​.

This means that investment in defense tech has a small percentage of investments generating the majority of returns. Typically, one-third of investments fail, another third break even, and the last third needs to achieve substantial returns to make the fund profitable​​​​.

Israeli companies seeking investment must comply with stringent security regulations and obtain necessary clearances. This includes cybersecurity measures, export control compliance, and adherence to national security laws to protect sensitive technologies from unauthorized access or transfer.

This rigor reflects the high stakes and unique challenges influencing investment decisions in this domain – and is also an indicator of excellence when a cyber company does succeed.

Israeli Innovations in Cyber Defense

Israeli firms are at the forefront of cybersecurity innovation, continuously developing sophisticated solutions to meet the challenges of an evolving threat landscape. In 2023 alone, Israel exported over $10 billion worth of cybersecurity products and services.

The sector continued to play a crucial role in H1 2024, representing 52% of private funding in H1 2024. M&A exits totaled $1.5 billion across 9 deals, accounting for 35% of 2024 H1 exits and reflecting that cyber defense is a cornerstone of the Israeli tech economy. 

Israeli cyber defense tech companies excel in several key areas:

Advanced encryption

Israeli technologies ensure the security of data transmissions across various digital platforms, protecting against unauthorized access and breaches.

Threat detection systems

Leveraging artificial intelligence and machine learning, these systems proactively identify and neutralize potential cyber threats before they can cause harm.

Secure communication channels

Essential for military and government operations, these secure channels prevent sensitive communications from being intercepted or tampered with.

These cutting-edge technologies safeguard national assets and play a crucial role in securing the global digital ecosystem, reinforcing Israel’s position as a pivotal player in international cybersecurity.

Signals Intelligence (SIGINT) Systems and Cyber Defense

Signals Intelligence (SIGINT) systems play a crucial role in cyber defense by intercepting and analyzing digital signals to gather intelligence. These systems are designed to monitor and collect information from various communication channels, including radio, satellite, and internet traffic. By picking up digital signals, SIGINT systems can detect potential cyber threats, track malicious activities, and provide valuable insights into enemy operations.

This capability is essential for preemptive defense measures and real-time response to cyber threats, making SIGINT a vital component of a comprehensive cybersecurity strategy.

IDF’s 8200 unit

From the earliest days of internet proliferation, Israeli intelligence units recognized the necessity of developing cyber defense capabilities. Units such as 8200, an elite part of the Israel Defense Forces, have been instrumental in developing innovative technologies.

The 8200 unit is globally renowned for its expertise in SIGINT. This unit specializes in intelligence gathering, cyber warfare, and advanced technological operations, making it one of the best in the world. The 8200 unit’s alumni often transition into the private sector, founding or joining leading cyber defense companies that continue to leverage their SIGINT expertise. 

Leading Cyber Defense Startups

Check Point and CyberArk stand out as leaders in the Israeli cybersecurity and cyber defense industry. Check Point offers extensive security solutions that protect organizations against a wide range of cyber threats, while CyberArk focuses on securing privileged accounts, often targeted in cyberattacks. Both are market leaders in the cybersecurity industry due to their comprehensive, innovative solutions and strong leadership rooted in the expertise of Unit 8200 veterans.

Their ability to adapt to emerging threats and maintain trust across critical industries ensures their continued dominance in the global cybersecurity landscape.

Check Point Software Technologies

• Description: Check Point provides a wide range of cybersecurity solutions including network security, endpoint protection, cloud security, and mobile security. The company is known for its unified security architecture that simplifies and enhances security management.
• Recent Milestone: Check Point has continued to expand its product offerings and global reach, recently acquiring Perimeter 81, a company specializing in secure remote access, to strengthen its SASE (Secure Access Service Edge) capabilities.

CyberArk

• Description: CyberArk focuses on identity security, providing solutions for privileged access management, endpoint privilege management, and secrets management. Their offerings are designed to secure high-risk access to critical assets and data.
• Recent Milestone: In 2024, CyberArk announced the acquisition of Venafi, a leader in machine identity management, for an undisclosed amount, enhancing their identity security platform.

Their innovative products have not only protected countless organizations but have also set benchmarks in the cybersecurity industry, demonstrating the effectiveness and reliability of Israeli innovations.

Other leading Israeli cyber tech companies with defense applications include:

Cyberbit

• Description: Cyberbit provides advanced cybersecurity training and simulation platforms used by military, government, and enterprise organizations to enhance their cyber defense capabilities. Their solutions include a cyber range platform for realistic attack simulations, SOC automation, and endpoint detection and response (EDR) systems.
• Recent Milestone: In 2020, Cyberbit raised $70 million in funding from Charlesbank Capital Partners to expand global sales, marketing operations, and accelerate product development.

Wiz

• Description: Wiz is a leading cloud security company offering visibility and control over cloud infrastructure. Their platform provides solutions for threat detection, vulnerability management, and security posture management.
• Recent Milestone: Wiz acquired Gem Security for $350 million in March 2024, becoming the world’s largest cybersecurity startup with a $10 billion valuation.

Sentra

• Description: Sentra specializes in data security, providing solutions for mapping, classifying, and protecting organizational data. Their platform helps organizations make data-driven security decisions and prepare for potential breaches.
• Recent Milestone: Sentra raised a $30 million Series A funding round in January 2024, bringing its total funding to $53 million. The round was led by Standard Investments with participation from several other investors.

Aim Security

• Description: Aim Security offers a GenAI security platform for enterprises, equipping security leaders with tools to drive productivity while ensuring protection for AI applications. Their platform addresses unique vulnerabilities associated with generative AI technologies.
• Recent Milestone: In January 2024, Aim Security raised $10 million in Seed funding led by YL Ventures, with participation from Cyber Club London.

Verint

• Description: Verint provides a wide range of intelligence and cybersecurity solutions to protect critical infrastructure and ensure public safety. The company’s offerings include threat detection, analysis, and interception technologies that help government and defense organizations monitor and respond to potential threats. Verint’s solutions are designed to provide comprehensive situational awareness and actionable intelligence, enabling defense sectors to secure their operations and assets effectively.
• Recent Milestone: Verint completed a strategic acquisition of Next IT, a provider of conversational AI solutions, to enhance its customer engagement and intelligence capabilities.

These companies offer crucial cyber defense solutions that enhance the capabilities of government and critical infrastructure, ensuring the security and resilience of essential services and operations.

The Global Impact of Israeli Cyber Defense

Israel’s cybersecurity technologies are integral to global security frameworks, with countries and multinational corporations relying on these systems to defend against sophisticated cyber threats. This global trust results from Israel’s rigorous focus on maintaining a cutting-edge cyber defense infrastructure, driven by continuous R&D and substantial government investment. Israel’s proactive approach ensures its technologies are some of the most reliable and advanced in the world, making Israel a key player in global cybersecurity

The export of these technologies enhances global digital safety and contributes significantly to Israel’s economic strength. The global demand for cybersecurity solutions has surged, driven by the increasing frequency of cyberattacks during geopolitical tensions and the complexity of digital threats.

Emerging trends and future directions

Israeli companies are actively exploring emerging technologies such as blockchain and quantum computing to enhance cyber defenses further as the cybersecurity landscape evolves. These technologies offer promising new ways to secure data transactions and protect against the next generation of cyber threats. Israel’s commitment to staying ahead of the curve in cyber defense innovation ensures its continued leadership.

Israel’s substantial contributions to global cyber defense underscore its leadership role in combating digital threats. Through continuous innovation and robust international collaborations, Israeli cybersecurity solutions set industry standards and drive global digital security forward. These efforts enhance Israel’s security and play a pivotal role in creating a safer world.

As cyber threats evolve, the reliance on Israeli technologies is expected to increase, cementing its status as a cornerstone of the global cyber defense market.

The post Israel’s Cyber Defense Capabilities appeared first on Startup Nation Central.

This article explores the unique Israeli cybersecurity solutions that protect digital infrastructures around the globe.

Overview of the Israeli Cybersecurity Market

Israel’s cybersecurity landscape is marked by vigorous growth and innovation. Here are some notable highlights:

• Startups and Scale: Israel is home to over 450 cybersecurity startups and companies. The value of Israeli tech companies’ exits was $7.5 billion in 2023, and cyber exits accounted for 19 out of 45 transactions totaling $3.8 billion, accounting for 51% of the industry’s total transaction value. 

• Market Dynamics: There has been a surge in investments in recent years, with significant funding rounds and many successful exits through acquisitions or IPOs. 

• Global Standing: Israel holds a considerable share of the worldwide cybersecurity market and is often ranked high on global innovation indices for its cybersecurity capabilities.

• Workforce Development: The sector employs thousands of professionals, with projections indicating robust growth in employment and expertise.

Israel’s Cybersecurity Industry is a National Security Imperative

Israel’s focus on cybersecurity is central to its national defense. Given the country’s geopolitical complexities and its position in a region marked by frequent conflicts, robust cybersecurity measures have been a priority for decades. This emphasis has led to developing sophisticated defensive cyber capabilities, which safeguard national interests and infrastructure.

From the earliest days of internet proliferation, Israeli intelligence units recognized cybersecurity’s potential as a critical tool. Units such as 8200, an elite part of the Israel Defense Forces, have been instrumental in developing cutting-edge technologies and methodologies. The experience and expertise gained during their service have encouraged many veterans to enter the commercial cybersecurity sector, where they continue to innovate.

Government Initiatives and Support

The Israeli government’s commitment to cybersecurity reflects a strategic imperative actively implemented and supported through various national policies and initiatives. Recognizing the critical need for robust cybersecurity frameworks, the government has established numerous programs to strengthen digital defenses.

Key among these is the Israel National Cyber Directorate (INCD), which coordinates all national cyber defense activities. The INCD not only formulates policies and strategies but also collaborates closely with private sector companies to bolster their defenses against cyber threats.

The Israeli government also invests heavily in cybersecurity, consistently increasing budget allocation as the threat landscape has evolved. Investment supports various facets of the cybersecurity ecosystem, including research and development grants, startup acceleration programs, and public-private partnerships.

Involvement of Universities, R&D, and TTOs

Israeli universities and research institutions are pivotal in the nation’s cybersecurity prowess. These institutions provide education and training and contribute significantly to research and development.

Of course, regardless of how successful R&D is, this does not entail commercial applications and scalability. For this purpose, tech transfer offices (TTOs) in Israel facilitate the commercialization of innovative technologies and ensure that the knowledge developed in academic institutions can effectively contribute to solving national and global security challenges.

Here are some institutions leading in cybersecurity innovation:

• Tel Aviv University offers a comprehensive cybersecurity program through its Blavatnik Interdisciplinary Cyber Research Center. Ramot is Tel Aviv University’s TTO, facilitating the transfer of innovative technologies from academic labs to the market, with a significant emphasis on digital and cybersecurity technologies.
  
• Technion has established a reputation for deep technical expertise, hosting an annual Cyber and Information Security Research Conference that gathers academia, industry, and government experts. The university’s Hiroshi Fujiwara Cyber Security Research Center was created in 2016 in collaboration with the Japanese visionary cybersecurity expert. T3 is Technion’s TTO, focusing on cybersecurity solutions.
  
• Ben-Gurion University has a dedicated Cyber Security Research Center known for its cutting-edge malware detection and cryptography research. It also collaborates with Deutsche Telekom to operate the Telekom Innovation Laboratories (T-Labs), which focuses on cybersecurity and data protection. The technology transfer office at BGU is called BGN Technologies. It plays a critical role in translating the university’s research outputs into commercial success, with a significant focus on the cybersecurity sector, among other fields.

Key Israeli Cybersecurity Companies 2024

• Check Point Software Technologies stands out for its advanced firewall and threat prevention solutions. These solutions are pivotal in shielding organizations from cyber dangers by leveraging threat intelligence and proactive defense strategies.
  
• CyberArk is dedicated to helping organizations safeguard their most critical assets by thwarting, detecting, and managing cyber threats that target privileged accounts.
  
• Cato Networks delivers a pioneering cloud-native and secure global SD-WAN (Software-Defined Wide Area Network) service, transforming how businesses securely connect their digital frameworks.
  
• Radware specializes in cybersecurity and application delivery solutions, ensuring businesses are shielded from DDoS assaults while maintaining the uptime and efficiency of online applications.
  
• Morphisec offers leading-edge threat prevention by employing moving target defense strategies. It secures endpoints against memory-based assaults and zero-day threats.

Perspectives and Opportunities: Financial Activity

Israel’s problem-solvers are bringing cyber innovation to the world’s solution-seekers.

Recent data from Finder highlights cybersecurity as one of the high tech industry’s most noteworthy trends for the upcoming year, second only to artificial intelligence. This anticipation mirrors the sector’s readiness to embrace artificial intelligence in cybersecurity measures, explore blockchain applications for enhanced security, and foster increased global collaborations.

The landscape of mergers and acquisitions (M&A) in the cybersecurity realm, despite experiencing a 25% drop in value from the previous year, witnessed a significant rebound in the fourth quarter, highlighting the sector’s resilience and growth potential.

This resurgence is particularly evident in the cybersecurity sector, where M&A exits soared to $2.8 billion in 2023, emphasizing its indispensable role within the tech ecosystem. Looking forward to 2024, investors and multinational corporations remain optimistic regarding the Israeli tech ecosystem. A notable 88% of multinationals plan to maintain or expand their presence in Israel, with positive projections for M&A and IPO activities.

In Q1 2024, the Israeli cybersecurity sector raised $846 million in private funding, accounting for nearly 50% of the total ecosystem funding and half of the top six exits. This was its most vigorous quarter since the second quarter of 2022.

Private Investment in Cybersecurity QoQ

Leading the charge, Axonius secured $200M in a Series E round. At the same time, Silverfort captured $116M in a Series D. Additionally, Claroty and Coro each raised $100M in rounds, with the specifics of Claroty‘s round undisclosed and Coro completing a Series D.

The increased investment is partly due to more attractive valuations while market demand grows among customers and acquirers. Furthermore, M&A activity has been particularly strong, fueled by a spree of horizontal acquisitions, demonstrating the sector’s critical role and appeal in the current investment landscape.

Top Exits in 2023:

• Talon Cyber Security with a $625 exit 
• Axis Security with a $500 exit
• Dig Security with a $350 exit

Top Funding Deals in 2023:

• Wiz raised a $300 million round D
• Cato Networks raised a $238 million round G

Startup Nation Central Impact

Startup Nation Central activities foster a stronger global cybersecurity ecosystem by delivering frictionless access to Israel’s bold and impatient innovators. Through various programs and partnerships, we help Israeli startups connect with international companies, governments, and investors to propel progress and build a more secure digital future.

Explore a wide range of Israeli cybersecurity startups on our Finder platform, where you can filter by funding stage, business model, location, and more.

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So, where’s the catch? We now see headlines about how the transfer, remote access to, and analysis of this data (medical and otherwise) – and a series of recent cyber-attacks – raise some data privacy concerns: who has access to which data and for how long?

This delicate interplay between privacy and data protection on the one hand, and the protection of public health on the other, presents a number of challenges. “There are a number of reasons why we should be wary of the new information-sharing reality that the global pandemic has created,” says Achiad Alter, a cybersecurity adviser to Start-Up Nation Central, and the founder of the Cybersecurity Unit at the Israel Export Institute, “but we are lucky to have versatile technology and cybersecurity on our side to help us assess risks and make the right decisions to stay safe.”

“Everything we do is exposed and documented”

Around the world, governments have been applying technology to conduct mobile location tracking of infected, or potentially infected, citizens and to enforce quarantines. In China, popular platforms Alipay and WeChat deployed a health code service, developed for the Chinese government, to provide citizens with red, yellow or green statuses according to their health records and travel history. The Israeli government “has the ability to pinpoint your whereabouts and the people you were with, using data from cellular providers and other implied means,” Alter says. Using mobile data therefore can enforce quarantines and encourage self-quarantines.

At the same time, experts are cautious about this new level of visibility into our lives. “Everything we do is exposed and documented,” Alter says. “That’s added to the risk of attackers hacking or gaining access to email and web accounts, thereby gaining the ability to completely obstruct someone’s personal or professional life. This is something that could potentially happen with increased data collection by governments, or even hostile entities that could access our accounts due to the new state of data exchange post-COVID.”

Will hijacked Zoom meetings become part of the remote work experience?

With the onset of social distancing in most countries, businesses “deserted” the office and began working remotely from home. For large organizations that were equipped for telecommuting prior to the crisis, only minor adjustments had to be made. But for the majority of companies, sufficient frameworks, policies and solutions to protect organizational data were not in place, potentially exposing employees’ personal and professional data to hackers eager to manipulate the current situation.

Organizations are now exposed to new threats, such as remote VPN connections on household Wi-Fi networks with weak security controls – with employees no longer working under the security umbrella of their employers’ protected networks.

In terms of upping security measures for communication platforms, Alter refers to the recent security breaches on the popular online conference platform Zoom, in which underground hacker forums circulated and sold thousands of users’ credentials, and the unfortunate practice of “Zoombombing,” or the hijacking of meetings, to display profane or malicious content.

“Cyber criminals and hackers try to take advantage of the current situation to gain access to our computers to steal information,” Alter says. “That’s where cybersecurity meets privacy.” Alter noted a number of Israeli cybersecurity companies that are laser focused on these challenges: BitDam, for example, has developed a solution that protects Zoom calls. Its advanced threat protection solution blocks content-borne attacks across all enterprise communication channels, including email, cloud storage, and other platforms.  

Increased interest in Israel’s cybersecurity companies

Cybersecurity is one of Israel’s most vibrant innovation sectors, with more than 420 startups and tech companies. Now, they’re seeing an increased interest due to the new cybersecurity threats:

In the field of secure remote access, Perimeter 81 provides a SaaS solution that encrypts user data to prevent hackers from accessing personal or professional information, and provides users with anonymous IP addresses so that their identity and location cannot be tracked.

In the field of intelligence, IntSights has been fighting fake news on social media and fake sites on the World Wide Web, with a recent focus on fake coronavirus news. It’s currently working in collaboration with the World Health Organization to fight misleading and oftentimes plain dangerous sites. In addition, the startup delivers early warning of hacking and fraud attacks, exposes and interprets hacker reconnaissance and then provides organizations with the tools to avert harmful attacks.

In the privacy protection subsector, Duality Technologies provides data collaboration solutions using advanced homomorphic encryption and data science, giving organizations the ability to derive insights on network behavior.  

In order to track the potential for data leaks in real time, data security startup Cognni (formerly known as Shieldox) deploys a “risk radar” and autonomous AI data protection to track data and block any risks, using clientless shielding technology, while also providing visibility into where files are and who has tried to access them.

At the device level, endpoint architecture platform Hysolate allows users to run multiple operating systems on one device, while maintaining security and ensuring a productive remote working experience.

Once data has already been breached, data loss prevention technologies, such as ITsMine’s AI solution, work to automatically and proactively protect against internal and external cybersecurity threats. The company sends alerts on breaches and critical forensic information to system administrators.

Phishing (email scams) is one of the major ways hackers are able to gain access to data, which is where companies’ cybersecurity education and awareness levels come into question. Enter Israeli startups IRONSCALES, which offers a fully automated anti-phishing solution to enhance security, training and response; and Dcyoa, which offers a security awareness and education solution that aims to improve organizational compliance, expand security knowledge, and change employees’ security behaviors.

“Now is the time to establish our boundaries”

Can all these technologies ensure our data privacy rights are maintained, even with the new data sharing challenges coronavirus has created? While limits on data privacy rights seem to have had real impact in curtailing the spread of the virus, these new developments raise a number of concerns. How do we ensure the responsible management of our data?

“It is important to define when boundaries have been overstepped,” Alter says. “Our privacy as individuals and as a society is being challenged, and will continue to be challenged, without a doubt. That is why now is the time to establish our boundaries, and to strike that tricky balance between data privacy and the complex reality of the COVID-19 era.”

Visit CoronaTech Israel to learn more about COVID-19 solutions, funding opportunities, and more.

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Initial Response to Cloud

The response of the companies in the traditional industry space was mixed. There was no automatic widespread recognition of Cloud for its benefits, nor was there a broader comprehension of precisely what Cloud had to offer. It took time, but the current understanding across the board is that moving to the cloud is essential, although the majority are still retaining an on-premises (on-prem) presence for at least some of their assets. This allows us to draw the conclusion that on-prem is not yet dead per se, though as a standalone “strategy”, it most definitely is. According to Michal Braverman-Blumenstyk, CTO of Microsoft Israel, “in ten years from now, approximately 90% of the assets in the world will be cloud based.”

Cloud and Security, Two Perspectives

1. Cloud is Wonderful, But…

Migration to cloud services is by no means a simple proposition. When migrating, companies open themselves up to a broad variety of new cyber risks. Considering the cloud-based infrastructure is important, as it is very different to the traditional enterprise network. Migration to the cloud means that many organizational and sensitive assets (including data, apps and so on) are located outside of company premises, with limited visibility, which is a further challenge to a comprehensive and watertight security approach – if such a thing can even be considered a plausible reality in the age of cybercrime. There are different kinds of cyber attacks. There are those which are entirely cloud oriented, those that are hybrid, and those aimed only at on-prem installations. Targets can exist on-prem, and yet the attack can begin in the cloud – and the other way round. To compound things yet further, traditional security products are becoming almost irrelevant for protecting assets over cloud services. According to Gartner’s analysts, the projection is that “enterprises that implement appropriate cloud visibility and control tools will experience one-third fewer security failures.” Many traditional security vendors are now expanding their portfolios of products to include solutions that tackle the ever-increasing surge of new, Cloud-focused threats within their suites. Examples of this include CheckPoint, with their CloudGuard offering, made possible by their acquisition of the Israeli-based Dome9, Cisco Systems, with their Umbrella and CloudLock offerings, and AlgoSec.

Cloud is a far more dynamic approach than on-prem. The economy of scale that this affords is precisely the advantage of the cloud. Rather than becoming the cause of any security problems, Cloud can be taken advantage of, and can be used for advanced analytics, visibility, and can help keep data more secure.

2. Cloud is Wonderful, Especially for Security and Risk-Management Issues

“Security vendors who don’t embrace the cloud in some way, will not survive.”

Michal Braverman-Blumenstyk, CTO of Microsoft Israel

All next generation cybersecurity solutions are already being consumed over cloud. This is a perspective best represented by Michal Braverman-Blumenstyk, quoted above, and her paradigm of “The future of cybersecurity is in the cloud”. This paradigm means that the great capabilities of cloud can and should be exploited in the service of layers of effective defense. Cloud is a great computing power that enables the comprehensive analysis of massive amounts of data, and it is the fact that it is in the Cloud which makes it so very successful. Were the large majority of the capabilities afforded by the Cloud used in an on-prem setting, it would be extremely expensive, and likely almost impossible to execute.

A further and even more radical paradigm indicates that if we move all of our network and applications to be over cloud – i.e. cloud-native architecture– we will be inherently more secure because the nature of cloud computing is de facto more secure. While it may seem as though “Cloud-native” sounds like a buzzword, there is much truth in what it implies. The level and quality of services and capabilities offered by the Cloud are not really available through any other medium.

Early Identification Has Led to a Flourishing Ecosystem

“Israeli start-ups are usually the first to spot and identify a trend early-on, so it was no surprise that so many pinpointed Cloud as a rising and effective trend in such a timely manner. As a result of this unique and intuitive far-sightedness, the Israeli Cybersecurity ecosystem is flourishing, which is great to see. Many of these prophetic companies and their solutions are both in and leveraging the benefits of the Cloud.”

Michal Braverman-Blumenstyk, CTO of Microsoft Israel

Click here for more information about Israeli innovation in the Cloud on Start-Up Nation Finder.

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However, the climate seems to be changing. The expected figure for companies scaling up is significantly higher than in previous years. While in 2017, a mere 35 Cybersecurity start-ups reached an annual revenue exceeding $10M, the Start-Up Nation Central 2019 Cybersecurity Report states that 2018 saw a trend of maturation among more and more Cybersecurity companies. 

The Trend is Shifting from Early Stage to Late

Early stage start-ups have always been a known draw for investors, with companies offering cutting-edge solutions to existing problems, proving irresistible time and again. Furthermore, there is an industry-wide global understanding that Israel’s competitive advantage lies in its tendency towards breakthrough solutions and cutting-edge innovation, which are heavily concentrated in the early stages of a company’s lifecycle. For this reason, we have seen fewer start-ups scale up and mature, due to the assumption that Israeli start-ups faced challenges in creating vast sales and marketing operations, as well as in penetrating new markets. Nowadays, with more accessibility to capital than ever before, Israeli start-ups will arguably be able to overcome these challenges and excel in this vibrant market. This also seems to be why investors from across the globe were largely attracted to investing in early stage start-ups, and there was less of an incentive to get on-board with the later stage start-ups prior to 2018. 

Record-Breaking Figures

Scaling up and expanding was thought of for years as an atypical progression for Israeli start-up companies; it was presumed to be too difficult for start-ups to get to that stage, or to be able to raise that level of funding. However, it now seems to be a very different situation. There is a huge amount of capital being invested in late stage companies – in a way that is almost analogous to fertilizer. The more that is spread out across the sector, the more fruitfully does the sector flourish, and the start-ups thrive. The number of Cybersecurity companies that had larger funding rounds – where larger means greater than $30M – almost doubled in the period between 2017-2018.

More Money, More Non-Israeli Investors

There is now a definite shift in trends – particularly since additional investors are showing definite interest in putting their money into later-stage companies. Over the past few years, more capital seems to be floating around than ever before. Interest in the more mature and established company and product is generating serious buzz among investors. However, it isn’t just Israeli investors who are expressing this interest. More non-Israeli investors than ever are looking at Israel as a likely, even desirable, place in which to put their capital – including corporate VCs.

Leaders in the Field, More Than Ever Before

This growth of cash gives rise to a new-old phenomenon. As a result of the potential collective maturation of the sector, we predict that over the next few years we are likely to see more and more Israeli Cybersecurity companies positioning themselves as leaders in their own fields of expertise within Cybersecurity. 

A Different Model for Success

There is a further manifestation of this abundance of investment in late-stage Cybersecurity companies in Israel. It appears that it’s becoming more lucrative to grow a company to maturation, and scale up and expand its business, rather than to hope for a big buy-out, or that multi-million-dollar exit – heralding a new era in the age of innovation and high-tech.

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To read more about this and other insights into the Israeli Cybersecurity sector, download the Start-Up Nation Central 2019 Cybersecurity Report .

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The Latest Threat

The latest in a long line of malware-inspired acts is cryptojacking – the malware-based, sneaky and unauthorized use of a person’s CPU and computing power for the purposes of mining cryptocurrency, which results in higher energy consumption and performance lag. Ransomware was once the bad guy (executing unauthorized and illegal encryption of data, followed by ransom demands for bitcoins), but cryptomining has surpassed it. Quiet and stealthy, cryptomining involves a similar vector and method to ransom malware – but according to McAfee Labs September 2018 Threats Report, it is silent cryptomining which is the new business  model.

The potential damage that cryptomining malware can cause to an enterprise cannot be underestimated. The unlawful and non-consensual drainage of power presents a significant growth in expense, for power and even for public cloud services may rise significantly, if attackers install cryptomining bots on cloud instances. However, the real risk is that malware already exists silently within many devices, quietly waiting to be activated.

Two Methods

The purpose of cryptojacking, regardless of method, is to mine for cryptocurrency by running complex mathematical problems on the victims’ computers, and gain “earned” rewards. There are two methods of secretly mining cryptocurrencies on users’ computers. One is to trick users into loading cryptomining code onto their computers using phishing-like tactics to install malware, where the victim receives what appears to be a legitimate email that encourages them to click on a link. By clicking the link, the victim unknowingly triggers a code, which embeds the cryptomining script on the computer, and runs in the background, unknown to the victim. The other method is similarly insidious, if not more so. Rather than having existing malware on your computer, cryptojackers inject a script on a webpage or an ad delivered to multiple websites. When the victims visit the website, or the infected ad pops up in their browsers, the script automatically executes. No permanent code is stored, nor any malware installed on the computers of the victims, meaning it is undetectable by file-based security solutions.

A white paper issued by the Cyber Threat Alliance includes the following extremely astute points: “The Illicit Cryptocurrency Mining Threat”:

“illicit mining is a drain on the resources in anyone’s enterprise, increasing the workload and the risk of physical damage on IT infrastructure, causing higher electrical bills, and decreasing the productivity of the business operations that rely on computing power… Illicit cryptocurrency mining is the figurative canary in the coal mine, warning you of much larger problems ahead…”

So Where Does Israeli Innovation Come In?

Since the most popular attack vector of cryptomining malware is phishing, email and messaging security solutions, such as BitDam and IronScales, or content disarm and reconstruction solutions, such as the one offered by Votiro, can block many infection attempts. There are also solutions that raise the awareness of employees to attempted phishing attempts, such as Cymulate.

Since it is nearly always impossible to fully prevent attackers from penetrating a network, it is highly recommended to implement post-infection solutions that detect and remedy malware infections. Both the Endpoint Detection and Response (EDR) and Endpoint Protection Platforms (EPP) families of solutions can be beneficial in this, using advanced threat detection, and investigative and response capabilities based on machine learning. There are many Israeli leading vendors in this domain, including Cybereason, SentinelOne, Check Point’s SandBlast, EnSilo, and Deep Instinct. Additionally, Minerva Labs’ Anti-Evasion Platform helps limit the infection of malware across a network.

Network Traffic Analysis and Monitoring solutions aggregate data from many points inside the network and at the perimeter, and are thereby able to detect cryptomining activity. SecBI’s solution analyzes network data and can reveal cryptojacking activity at the level of the network.

Companies such as ChameleonX and Namogoo, offer client-side security solutions for website owners, and can be very useful in detecting and removing malicious scripts, which help website owners prevent browser-based cryptomining script execution, ensuring that no malicious scripts are running as part of their web pages.

Head on over to Start-Up Nation Finder to find out about more information about these and many other innovative Israeli Cybersecurity companies.

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Securing The Internet of Things (IoT)

The Internet of Things can quite literally be described as the fastest growing worldwide phenomenon over the last decade, if not longer. More and more areas of everyday life are incorporating connectivity as an expected feature. Even devices traditionally perceived as non-high-tech, such as dishwashers, electronic pacemakers, and even passenger train engines, are now connected, oftentimes even to the cloud.

This in and of itself presents both a positive user opportunity and a worrying security threat. The number of new inter-connected devices being created, and the rate at which they are being adopted, is booming, which is causing corporate networks to fast become unwieldy and difficult to manage. Many devices traditionally considered to be low-tech are now connected, regardless of whether smaller or larger in size, including anything from pacemakers to passenger trains.

As stated in the Start-Up Nation Central Finder Series Cybersecurity Report:

“…IoT security risk is not only a threat to the corporate network, but can also be harmful to industrial OT networks, smart grids, connected cars, and to the internet infrastructure itself… [raising] a huge challenge in the management of networks, and in the development of smart devices”

Unsurprisingly, one of every three new start-ups founded in 2017 involved IoT security technologies and solutions.

The Alarming Issue of Privacy Protection

While there are many positives involved in the issue of IoT, it has also raised many hackles. Not only has the amount of accessible data grown exponentially as an indirect result of the proliferation of IoT among next-generation devices, but also much of this information is or could be potentially sensitive. The recent debacle with Cambridge Analytics points to just one aspect of this, and it was not an isolated incident. Furthermore, the EU’s Global Data Protection Regulations (GDPR), which went live recently, will heavily affect business cycles, since organizations and companies are now obligated by law to keep, protect and administer data in a far stricter and much more heavily structured (regulated) manner.

That said, according to the Start-Up Nation Central Finder Series Cybersecurity Report, this may be a good thing as far as privacy is concerned:

“…policymakers are becoming more concerned with the effect of cyber breaches on individual privacy, and are starting to enforce safer data management. The GDPR… targets any business that holds private information on EU residents, and may lead companies to handle personal data with a higher standard of care.”

Start-Up Nation Central has seen and heard actual evidence through many of our global corporate clients, about how this affects them, and influences business decisions, and the adoption of cutting-edge cybersecurity measures. Indeed, it might seem to some that this is one of the reasons why many find themselves in Israel in the first place, given that the Israeli cybersecurity industry is so strong. However, the evidence to which Start-Up Nation Central is privy is only a small part of the global picture – from other data that we have collected, the success of the Israeli cybersecurity sector is something that has been growing and flourishing for years, and its reputation is both laudable and well-deserved.

Challenges as Defined by Corporate Entities

According to the Start-Up Nation Central Finder Series Cybersecurity Report, the fields of interest shown by our clients indicate the challenges perceived as noteworthy by global corporates in 2017, with roughly half interested in IoT solutions for their own corporate networks, their Operational Technology networks or for their customers – up significantly on 2016. Also attracting much interest in 2017 were solutions for security operations, such as threat intelligence, incident response and SIEM integration, together with risk management and domain compliance – also a response to GDPR. Financial institutions were largely concerned with anti-fraud and authentication solutions for mobile devices.

The Maturation of Cybersecurity

It’s not just that the Israeli Cybersecurity ecosystem is growing chronologically older, which, let’s face it, could be said of everyone and everything. It’s also that the sector, if not exactly coming of age, is ripening into a well-established entity, with Israeli cybersecurity companies gaining more and more opportunities to grow, become profitable and position themselves as industry leaders. As a direct result of this, investments in these companies seems to occur more frequently at a later stage.

IoT is the Place To Be

Both locally and globally, 2017 was the year in which the cybersecurity sector began to really devote increased and more substantial efforts into developing solutions dealing with the defense of IoT and connected devices. Certain specific IoT segments also saw an amplification in terms of attention and effort, including automotive systems, medical devices and industrial control systems. In fact, according to the Start-Up Nation Central Finder Series Cybersecurity Report, the largest subsector of newly founded companies is Connected Devices, IoT and Control Systems, exceeding Network security for the first time ever.

Click here to download your copy of the Start-Up Nation Central Finder Series Cybersecurity Report.

The post Why Global Enterprises Are Seriously Taking Notice of the Israeli Cybersecurity Industry appeared first on Startup Nation Central.

Maturation

Israeli cybersecurity companies are gaining more opportunities to grow, become profitable- and position themselves as industry leaders. As a result, the nature of the investments in these companies appears to be happening at a later stage, on a more frequent basis- once they are as more substantially established.

There are also further indicators of the increase in maturity of the local industry. Three of the five largest investment deals over the past few years happened within the cybersecurity industry (SentinelOne, Cybereason, Skybox). There has also been a notable increase in the average size of investment deals raised by early and late-stage start-ups, and the aforementioned increase in late-stage investments.

2017 also saw more funding deals in which international investors participated than those in which Israeli investors played a part, proving yet further the growing recognition of Israel as a global leader in cybersecurity.

Globally Speaking

Over the year, cybersecurity incidents continued to dominate world headlines, demonstrating a steadily escalating trend of cyber and ransomware attacks, with high profile breaches including WannaCry, NotPetya, the Equifax data breach, and the CIA leak, which collectively indicate very clearly that regardless of claims to the contrary, no organization is immune to cyber attacks.

As previously mentioned, the Israeli Cybersecurity sector continued to grow and mature over the course of 2017. Several events occurred during the year, which not only solidified Israel’s position as a source of innovation for cyber defenders all over the world, but also demonstrated, in terms of funding, development and revenue, that the Israeli industry has reached a new level of experience and wisdom.

Measuring Growth

In terms of “population” growth, seventy new companies were founded within the cybersecurity sector during 2017, bringing the total number of active cybersecurity companies in Israel to a whopping 420. In terms of funding growth, Israeli cybersecurity companies raised a total investment sum of $814.5M in 2017, both in venture capital money and private equity. This is the third year in a  row that the amount exceeded the amount raised by investments in a previous year – this time, an amazing 28% more than in 2016.

Geographically Speaking

The cybersecurity industry most invested in was the US, however, running an impressive second place was Israeli cybersecurity, with 18% of global investment landing on its sunny shores. 

IoT is Where It’s At

From both a global and a local perspective, 2017 will be noted as the year in which the cybersecurity sector began to devote highly significant efforts into the defense of IoT and Connected Devices; particularly in specific IoT segments, including medical devices, automotive systems, and industrial control systems.

Did You Know…?
One of every three new start-ups founded in 2017 is involved with IoT Security.

Analysis, Facts, Figures, Conclusions

Start-Up Nation Central’s Annual Cybersecurity Report  offers a comprehensive and up-to-date analysis of the state of the Israeli cybersecurity ecosystem, its trends and how they reflect the global challenges that the corporate world and states deal with.

Something else covered by the report is the attractiveness of the Israeli cybersecurity industry for multinational companies. There are now 30 multinational companies from various industries with cybersecurity-related R&D centers in Israel. Furthermore, several new international players entered the local industry, and opened R&D and cyber innovation centers in 2017, including Symantec, TD Bank, Renault, Daimler AG, and Harman.

Click here to download your free copy of the Start-Up Nation Central 2018 Cybersecurity Report

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