Two years ago, if someone had said four Israeli cyber companies would be sold for more than $70 billion combined within eighteen months, it would have been hard to believe. That is exactly what happened. Google closed its $32 billion purchase of Wiz in March, the largest deal in Israeli tech history. Palo Alto Networks completed its roughly $25 billion acquisition of CyberArk in February. ServiceNow bought Armis for $7.75 billion, and in October Proofpoint agreed to buy Varonis for $6.3 billion in cash.
The four deals are not alike. Wiz is young, founded in 2020 and within five years one of the world's leading cloud security companies. CyberArk and Varonis are veteran public companies founded by Israeli entrepreneurs many years ago and listed on Nasdaq. Armis sits somewhere in between. But they share one thing: all were bought by American giants that want to be a 'platform', offering customers every layer of protection from a single vendor.
The Wiz story shows how long that road is. Its four founders, Assaf Rappaport, Yinon Costica, Ami Luttwak and Roy Reznik, had already sold a company, Adallom, to Microsoft and then led cloud security work inside Microsoft in Israel. In 2024 they turned down a Google offer of about $23 billion, partly over investor and antitrust concerns. A year later they signed for $32 billion, and the deal closed only after reviews by the US Justice Department and the European Union. Wiz keeps its brand and still runs on Amazon, Microsoft and Oracle clouds.
Most of these founders also share a background. Many came out of the IDF's technology units, where they were given responsibility for complex systems and teams at a young age. That is the advantage that is hard to copy: not just technical knowledge but hands-on experience against real attackers, and a network of people who know each other and start companies together. The American giants know this, which is why they pay not only for the product but for the team.
Why now
The first reason is AI. Companies are connecting AI agents to internal systems, customer databases, code and documents. Each agent is effectively a new 'user' with permissions, and every permission is a potential opening for an attacker. That is exactly CyberArk's field, identity and access management, and Varonis's, which is about who accesses which data. What was once a technical niche has become a question that worries every CEO.
The second reason is market structure. Customers have grown tired of managing dozens of security products from different vendors, and the giants understand that whoever holds the broadest platform wins. After its acquisition Palo Alto said it now has an offering in nearly every major category of cybersecurity. The fastest way there is to buy, and Israel is perhaps the densest market in the world for cyber companies that can be bought.
The third reason is price. Shares of some public cyber companies had stalled, and private equity firms and giants saw an opportunity. Proofpoint, owned by Thoma Bravo, paid a 52% premium for Varonis over its price before the rumors. For shareholders that is an immediate gain; for the buyer, it is a bet that data security in the AI era will be a huge market.
What happens to employees
Exits have a less glamorous side. When an Israeli company is absorbed into an American corporation, decisions move to San Francisco, Santa Clara or New York. Sometimes the Israeli development center grows, because the buyer wants precisely that talent. Sometimes the opposite happens. In October CrowdStrike acquired XM Cyber's technology, and the deal ended with most of its Israeli staff laid off, a reminder that not every acquisition is a celebration for the people who work there.
Even when employees stay, something changes. An independent company competing for customers behaves differently from a unit inside a corporation of tens of thousands. Some will say that is good: more resources, more stability, access to customers worldwide. Others will say it is exactly what gradually turns Israel into a 'development center' for foreign companies rather than the place where the big companies themselves are built.
The money that comes home
But the money does not disappear. Tens of billions of dollars flowed to shareholders, venture funds and thousands of employees holding options, and some of it returns to the ecosystem. The Wiz founders, for example, are reportedly in talks to buy the McDonald's franchise in Israel and have also looked at the credit card company Cal. It is a relatively new phenomenon: tech founders investing in Israel's 'old' economy.
Another part of the money stays in tech. Founders who exited become investors in young companies, and employees who got rich start companies of their own. That is how the Israeli ecosystem was built over the years: generations of founders came out of Check Point, and the next generations came out of them. If the pattern repeats, the current exit wave will fund the next wave of companies.
The next generation is already here
And the next generation is already raising. According to IVC and LeumiTech, Israeli cyber companies raised about $4.3 billion in the first three quarters of 2026. Cyera, which specializes in data security, is reportedly in talks to raise at a valuation of about $20 billion. Upwind became a unicorn with a $250 million round at a $1.5 billion valuation. This week Sentra announced a $150 million raise, and CrowdStrike is, according to Calcalist, in talks to acquire Orion Security for about $500 million.
Notice the pattern: most of the hot companies deal with the same question that made Varonis and CyberArk such prized assets. Who accesses data, and how do you protect it when AI agents get access to everything? This field, known in the industry as data security and identity security, is probably the hottest front in cyber right now, and Israel is at its heart.
The big question
Still, some are worried. When the big companies are sold, Israel is left with fewer 'anchor companies': large public companies headquartered here that employ thousands and train the next generation of managers. Check Point is still one, but it faces its own slowdown, and its revenue dipped slightly last quarter. Without anchors, young startups grow to a certain point and then get sold too.
Palo Alto, by the way, said it plans a secondary listing of its shares in Tel Aviv under CYBR, CyberArk's old ticker. It is a symbolic gesture, but it also shows how deep the ties between American cyber giants and Israel run. They do not just buy companies; they need the engineers, researchers and experience built up here, including in the army's technology units.
What does it mean for a young engineer entering the industry today? First, that cyber is still one of the safest fields in Israeli tech, even as other software companies cut jobs. Second, that the skills in demand are shifting: understanding AI, cloud and identity management is worth more than general knowledge. And third, that many of the interesting jobs will be at young companies funded by money from earlier exits, looking for people willing to start from zero.
Bottom line: the 2025-2026 wave is both a huge success and a turning point. A success, because it proves Israeli cyber companies are worth tens of billions and that the world will pay for them. A turning point, because the question now is whether Israel remains a factory for companies that get sold, or also builds the next giant that stays. The answer depends largely on what those who sold do with the money.
