[Photo: DefenseTech Haifa conference. Credit: HiCenter Ventures]

As investment in Israel’s defense-tech sector continues to accelerate, one of the strongest messages emerging from this week’s DefenseTech conference in Haifa was strategic rather than technological: for most startups, the fastest route to market is not developing a complete weapon system, but building a specialized component that can be integrated into the platforms of major defense contractors.

According to data published by JNS, startups working with Israel’s Ministry of Defense have raised nearly $3 billion since the beginning of 2026, compared with roughly $1 billion during all of 2025. The report attributed the surge to growing private investment driven by rising global demand for defense technologies following recent conflicts.

That message was at the center of the conference, organized by HiCenter Ventures, Gornitzky GNY, and EY, which brought together entrepreneurs, investors, representatives of Israel’s defense establishment, and executives from leading defense companies.

Ilana Abrakin, Head of Defense Tech at HiCenter Ventures, argued that early-stage companies should avoid competing directly with established defense manufacturers such as Rafael, Elbit Systems, Israel Aerospace Industries, or global defense primes.

“We encourage founders to design their products as independent, flexible, and platform-agnostic components that companies such as Lockheed Martin, RTX, Israel Aerospace Industries, Elbit Systems, or Rafael can easily integrate into their existing platforms through a plug-and-play approach,” she said.

According to Abrakin, many startups fall into the trap of trying to build complete end-to-end systems, even though their commercial prospects are significantly stronger as technology suppliers to established defense contractors. In line with this strategy, HiCenter Ventures announced plans to invest in ten defense-tech startups this year while supporting them with fundraising, pilot programs with defense companies, export compliance, and long-term strategic partnerships.

Rafael also signaled its intention to deepen collaboration with startups. Dr. Moshe Shuker, Senior Vice President of R&D at Rafael, said the company is adapting its innovation strategy to the rapidly evolving defense-tech ecosystem and is looking to expand cooperation with young companies—from integrating individual technologies and subsystems to collaborating on Rafael’s flagship defense platforms.

“The combination of agile startups and established defense organizations can dramatically shorten the path from an idea to a battlefield-ready capability,” he said.

Another trend highlighted during the conference was a shift in investor priorities. According to HiCenter Ventures CEO Lior Hanuka, investors are increasingly focused on the software and artificial intelligence layers that power defense systems, rather than on the hardware platforms themselves.

Key areas of interest include battlefield operating systems, mission-management software for drones and autonomous robots, secure military communications networks, and AI applications capable of supporting real-time decision-making. At the same time, lessons learned from the conflicts in Gaza, Lebanon, and Ukraine have made electronic warfare, GPS denial, spectrum dominance, and counter-drone technologies some of the sector’s fastest-growing investment areas.

The overall picture emerging from the conference is of a defense-tech ecosystem that is rapidly maturing: less emphasis on building complete platforms and greater focus on specialized technologies that can be integrated into existing defense systems—a model that enables startups to reach the market faster while becoming part of the supply chain of major defense contractors.