Ilan Misano

Tech continues to drive Israel’s economic resilience, but beneath the surface the ecosystem is showing signs of strain and health tech is feeling the pressure most. The announcement of clinical AI company Aidoc's recent $150 million raise, backed by General Catalyst, Square Peg, nVentures (NVIDIA’s venture capital arm), and four major U.S. health systems, is a sign of what is still possible: when the science is solid, the platform is ready, and the value is global, capital will follow. This is proven by the over 45 million patients currently benefitting from Aidoc's integration across more than 150 health systems. Aidoc’s success is an outlier today, but it should be the model. As the largest sector in Israeli innovation, with over 1,600 companies, health tech should be a source of strength. Instead, in the first half of 2025, it drew just $630 million in private funding — the lowest total in five years. Median deal sizes are shrinking, and time from seed to Series A has stretched to 54 months, pointing to deep structural challenges rather than a short-term slowdown. Capital is flowing elsewhere, toward sectors with faster cycles and clearer paths to scale. Cybersecurity raised $2.2 billion with a median round size of $25 million in H1 2025, while business software led all sectors with $3.2 billion. Health tech is struggling to compete for attention, investment, and talent. These trends are part of a broader shift. Israel’s global innovation position is narrowing, infrastructure hasn’t kept pace with the needs of deep tech, and overreliance on a few sectors is leaving others under-supported. Talent shortages and limited access to global markets are compounding the pressure. At Startup Nation Central, we are seeing this firsthand. Through our work with the 8400 The Health Network Health Network and across the ecosystem, the signals are clear. Health tech is underfunded and underprioritized at a time when its relevance has never been greater. Still, the fundamentals are here. Israel has a strong scientific foundation, a deep pool of entrepreneurial talent, a world-class healthcare system, and health professionals with a track record of innovation. Add to that a growing global demand for health solutions, and the potential is clear. With targeted investment, a renewed focus on translational research, and the right strategic partnerships, health tech can not only recover but take the lead as Aidoc has. The opportunity is real and so is the urgency to act on it. 

108

9 commenti

I was asked by an Israeli university how should they change their CS faculty teaching given the progress in AI. I thought this might be helpful to others so reposting it here. since the topic is near & dear to my heart, a couple of notes: 1. it's good you are thinking about it. i don't think software engineering will look anything like it does today as early as 2 years from now. I suspect you are seeing reduced registrations for bachelor degrees. other universities do. i'm mostly referring to such in this message, but I don't think changes in research are that far off. 2. we are seeing almost no demand for junior software engineer positions in our portfolio of 60+ companies. we are starting to see the shift from LLM based co-pilots to Devin and similar companies offering engineer replacements. these moves from useless a year ago, to junior 6 months ago, and more recently starting to be useful for intermediate engineering tasks. 3. obviously there is ways to go for senior engineering and even more so for research roles BUT the progress is fast, and it's a positive 2nd derivative. it's accelerating. 4. the key requirement today for someone operating these tools is engineering intuition. knowing what works and what doesn't, and how to guide & direct the agents. it's an interesting combination of product management and engineering.  5. so my 1st piece of advice is you have a real opportunity to become a school for schools. much of the software development activities will move higher up the stack to the business functions. empowering these schools with engineering-oriented curriculum. i assume it sounds blasphemous but it can increase your reach rather than risk your relevance. 6. my 2nd suggestion is find a way to change the academic incentive system to support multidisciplinary work. this is a message I sent a year ago internally within the fund: I spoke to XXX of YYY. he is a professor of EE, and I got some insights about the Israeli academic system which are concerning. when I asked he thinks there is little collaboration between computer science departments whose grads are writing AI algorithms and electrical engineering creating CPUs, especially for non-transformers architectures, his feedback was "incentives". this might be a global academic issue, but as we care about Israel…  tenure is voted by your peers in your field. this has two effects: 1.  leading and impactful CS researchers that would have great value to CS tenure track won't be of benefit to EE tenure track, 2. worse, in-Israel collaborations are considered second class, which makes #1 even more harmful. I hope this isn't too blunt and will be at least somewhat useful. 

137

20 commenti

Moving to the US could be a startup's best move    Relocation to the US significantly increases the chances for international startups to become unicorns, according to our research.    For example, 44 Israeli VC-backed startups that moved to the US reached unicorn status. By contrast, only 3 unicorns in a comparable US-based sample were based in Israel. This suggests that Israeli startups relocating to the US are about 15 times more likely to achieve unicorn status.    We observed similar trends for other countries:  – India-founded startups relocating to the US are 6 times more likely to become unicorns (12 vs 2).  – UK-founded companies see an 8.5 times greater chance of achieving unicorn status after moving to the US (17 vs 2).    These numbers indicate that the US offers unique advantages for high-potential startups from around the globe, particularly from countries like Israel, India, and the UK.    Thank you to the Stanford University Graduate School of Business Venture Capital Initiative for support.    Note: all unicorns in our sample must be US-based at the time of their first unicorn round. 

1.217

79 commenti

Israel can either buy the algorithms that will rewrite medicine or build them. We do better when we build. In my new op-ed in The Jerusalem Post, I outline how Israel can lead the AI‑bio convergence with world‑class talent, deep real‑world data, GMP scale, and pragmatic regulation. Full piece: https://lnkd.in/gH2efe5F The momentum is here: Biolojic Design, Ltd. is programming antibodies. Immunai is mapping the immune system at single‑cell resolution. Aidoc and Viz.ai are moving life‑saving decisions faster in hospitals. At Somite AI.ai, we're developing AI foundation models for human stem cells to drive novel cell therapies at scale. If we align policy with execution, capturing even five percent of this value chain adds a Mobileye‑scale contributor to GDP. Let’s lead! Teva Pharmaceuticals, Pluri #AI #Biotech #CellTherapy #Israel #Healthcare

71

6 commenti

#Deeptech Venture Capital funds? The new Yozma #FoF by the Israel Innovation Authority is open for applications until November 4th, to support Israeli or foreign Venture Capital funds who have a dedicated Israeli focused Deeptech fund, led by experienced GPs. * Winners will recieve an investment of between $4m to $10m per fund. *Min size of targeted fund: $32M, Max IIA investment: 12.5% of the fund size. * All fund sizes are eligible, from early-stage to growth-stage investors. The deadline for submission of applications is November 4th, 2025 For more details: https://lnkd.in/d6_r6EQy

50

1 commento

IVC presented a special analysis at the AI Digital Health conference hosted by People & Computers. The study examined active companies in the field, their funding, and other relevant factors. According to the data, 55% of Israeli AI companies focus on enterprise software and infrastructure, while over 300 companies (13%) work in digital health. The Israeli digital health cluster includes 564 companies. Only 22 companies have more than 100 employees, indicating that the ecosystem is still relatively young. More than half of the companies are at the Seed or R&D stage. On the other hand, 44% are selling products to their markets. There are 338 Israeli AI companies focused on digital health, with 200 of them founded in the past five years. Israeli tech companies raised $93 billion in 6554 deals. Israeli AI companies raised $50 billion in this period. AI digital health companies raised $3.5 billion.

30