Israeli Venture Fund Targets Defense Technology Startups as Demand for Battlefield Innovation Grows
An Israeli venture capital fund is focusing on early-stage defense technology companies developing drones, AI systems, and advanced sensing solutions. The move reflects growing investor interest in military innovation as recent conflicts reshape procurement priorities.
A new Israeli venture capital initiative is focusing on defense technology startups as governments and militaries seek faster access to emerging battlefield capabilities.
Protego Ventures, founded by investors Lital Leshem and Lee Moser, is positioning itself as a dedicated investor in companies developing technologies for defense and national security. The firm concentrates on early- and growth-stage startups working on artificial intelligence, unmanned systems, robotics, and advanced sensing technologies, areas that are becoming central to modern military operations.
According to the fund’s founders, recent conflicts have accelerated interest in technologies that can be developed and deployed more quickly than traditional defense programs. Military operations in Ukraine have highlighted the operational value of drones, satellite data, and AI-enabled analytics, while fighting in the Middle East has reinforced demand for faster decision-support tools and autonomous systems.
These developments are pushing governments to engage more closely with startups, supplementing established defense contractors with companies capable of delivering new technologies at shorter development cycles.
Protego Ventures intends to invest in companies whose products can serve both defense and civilian infrastructure applications. The firm also aims to help portfolio companies navigate complex defense procurement processes and connect them with international partners.
Among its investments is XTEND, a developer of drone-based robotic systems designed to enable remote operations through immersive control technologies. The company previously indicated plans to pursue a public listing in the United States at a valuation of about $1.5 billion.
Another portfolio company, Prisma Photonics, uses existing fiber-optic cables as distributed sensors capable of monitoring infrastructure such as pipelines, rail networks, and energy assets. The technology is intended to enhance situational awareness and infrastructure protection.
Protego is also pursuing partnerships with defense and industrial stakeholders in India and Gulf states, regions that have significantly increased investment in security technologies and critical infrastructure protection.
Historically, venture capital firms have often avoided the defense sector due to long procurement cycles and regulatory barriers. However, rising geopolitical tensions and the operational relevance of new technologies are attracting a new generation of investors focused specifically on defense innovation.
Israel’s technology ecosystem has long been associated with cybersecurity and enterprise software, but defense-focused startups are increasingly drawing attention from international investors and strategic partners. According to the fund’s leadership, this trend is expected to expand as demand grows for technologies addressing modern security challenges.
