IVC-LeumiTech: 2025 was tale of two M&A trends

In 2025, Israel’s tech industry saw record-breaking capital raisings for young cybersecurity companies, continued to grow unicorns worth billions of dollars such as Cyera, Island and Decart, and celebrated the exits of Wiz, CyberArk. and Armis. for a combined $65 billion (although all these deals are awaiting regulatory approval and have not yet been completed).

On the other hand, a significant number of startups found themselves in a completely different situation. Many of them were forced to recalibrate their plans, to accept that their cash reserves were about to run out, that the next round of funding would be more difficult, and many sought a buyer – on the advice of investors or their own independent decision.

According to a new study by research firm IVC and LeumiTech, 2025 was a year of low returns for Israeli tech companies, in which previously promising companies were sold in liquidation sales for less than the amount they raised – or were sold at a low yield, which disappointed investors.

The study also reveals another face of Israeli high-tech, in which a handful of success stories cover up dozens of companies that failed to fulfill their mission: to grow rapidly around the world and achieve phenomenal returns for shareholders.

Both Cybereason and Gett were sold for disappointing returns

If we ignore the Wiz, the Israeli tech companies sold in 2025 raised $10.1 million on average, but were ultimately sold for almost zero return – an average exit of $11.4 million. In 2024, returns from exits were much higher: companies sold in 2024 did so for an average of $12.6 million after raising an average of $4.5 million.

Among the companies in the IVC database that are described as having been sold at a loss were the taxi app Gett. which raised $877 million and was sold for $188 million; some of SoftBank’s companies in Israel: Cybereason . which was sold for an unknown amount after raising $933 million, and IVC estimates that it was sold for a very low amount, and facial recognition company Oosto. (formerly Invision) which was sold for $125 million after raising $352 million.

Also on the list: two of the companies founded by serial investor Benny Landa: Landa Digital Printing and Highcon, which were sold under the auspices of court-appointed trustees, with a combined loss of hundreds of millions of dollars; and even startups such as Neuroblade and Gili Raanan’s Savvy Security which were sold to large international corporations, but for negligible amounts. The IVC database lists no fewer than 90 Israeli companies that were ultimately sold for amounts ranging from zero to a million dollars in 2025, compared to 70 the year before.

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Two contradictory trends that played a role

At the same time there was an increase in the total volume of exits in 2025 – even without the acquisition deals for Wiz, Armis and CyberArk, which have not yet closed. In 2025, Israeli tech companies were sold for $17.7 billion, a record figure since 2021. This is due to the billion-dollar deals for Next Insurance, Melio, Sapiens and Verint, and dozens of other deals worth hundreds of millions of dollars.

However, IVC – LeumiTech found a decline in acquisitions by US companies in Israel compared with 2024 from $11.3 billion in 2024 to $8.8 billion last year. This is while the share of other countries in these acquisitions increased from $3.9 to $6.5 billion. For example, Next Insurance was acquired by Germany’s Ergo for $2.6 billion, while Melio was sold to New Zealand’s Zero for $2.5 billion.

“Two contradictory trends are playing a role here,” says IVC research director Shmulik Shelah. “The exit market has improved worldwide and in the last two years we have seen a renewed jump in the volume of company sales, and if high-tech investors – venture capital funds – were afraid that they would not be able to realize their investments, they are now breathing a sigh of relief and pushing the companies they own for sale. However, a large part of the companies raised capital between mid-2020 and mid-2022 at a valuation that was not realistic, which resulted in the return not being high and also explains their low efficiency multiple. I would not call it a liquidation sale – it is more like a cork that has been released.”

Looking to the M&A market

Barclays Israel CEO Ilan Paz explains the gap that has emerged between the impressive acquisitions of Wiz etc., and companies that struggle to show returns: “Although the companies listed on the New York Stock Exchange are highly valued, the dream of an IPO has become somewhat distant because the revenue threshold for going public has risen greatly, and the recent tech IPOs have mostly disappointed. As a result, many high-tech investors – namely venture capital funds – feel freer to examine the M&A market.”

Paz continues, “There are cases where there is already one interested party in the acquisition, and then the company turns to us to help them bring in additional offers to generate higher value and in this case there are also successes. However, there are also other cases where there is no acquisition offer on the table, the company needs financing, and the shareholders are not willing to continue investing. In such a case, they turn to us to help them at least sell the company at a reasonable price. But the smart investors present their companies to us at an early stage, and then we have an early acquaintance with them and are able to help them in real time.”

Paz notes, “In 2021, when interest rates were zero, money was cheap and was thrown all over the place. When interest rates rose, pockets shrank, and companies that were accustomed to growth at all costs had difficulty adapting to a new reality. But I must say that Israel is once again at the top of the buyers’ priorities – they understand the resourcefulness of entrepreneurs who went through the war, the exceptionally high concentration of talent here – and the returns they will be able to receive. We are also seeing a trend in which local investors are starting to look again at the Tel Aviv Stock Exchange as a logical alternative to an IPO, after not seeing it as such for 15 years.”

Published by Globes, Israel business news – en.globes.co.il – on January 19, 2026.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.