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Introduction
In an era marked by geopolitical upheaval and rapid technological evolution, defense innovation is no longer the sole domain of massive corporations or national military labs. Instead, the frontlines of innovation are shifting toward nimble startups capable of adapting quickly and producing cutting-edge solutions. This transition is especially visible in Israel, a country historically shaped by conflict and known for its technological prowess. At the Tech1 Conference in Eilat, former Israeli Air Force Commander Amikam Norkin shed light on this transformation, arguing that war and security threats serve as catalysts for technological advancement ā and startups play a pivotal role in that evolution.
The Role of Startups in Modern Warfare
Speaking at Tech1, Norkin emphasized how nations under threat must not only deploy existing defense capabilities but also rapidly invent new ones. Thatās where startups come in. Unlike traditional defense contractors, startups are agile, experimental, and increasingly well-integrated into military ecosystems. Through Ace Capital Partners, Norkin is investing in advanced aerospace and defense technologies, including space sensors and hybrid propulsion systems for UAVs.
He believes the ongoing global instability ā from the South China Sea to Ukraine and now India ā is shifting investor focus toward defense. This trend, he predicts, will last at least a decade, further accelerated by U.S. policies encouraging Europe to develop its own defense autonomy.
In the wake of the October 7 attack, Norkin maintains that Israelās strategic position is stronger, provided the country makes sound decisions moving forward. He credits human capital and regional respect for Israeli defense tech as key advantages. Despite political rhetoric and international boycotts, defense collaboration with Israel continues discreetly in many places.
Norkin also discussed the waning flexibility of the U.S.āIsrael defense aid agreement, noting that while it has benefited both nations, Israel now faces constraints in using American aid locally. He argues for a renegotiated deal aligned with the new regional and global dynamics.
Regarding startup integration into defense, Norkin sees real progress. Defense ministries and R\&D departments are opening their doors to younger companies, and venture capital is increasingly supportive. He encourages Israeli startups to first establish credibility by selling to the IDF, even if the local market isnāt immediately lucrative.
Although the legitimacy of some Israeli defense companies is under attack internationally, Norkin says many governments distinguish between politics and procurement. He insists that with proper government involvement ā especially in underfunded sectors like AI, lasers, and space ā Israel can remain at the forefront of defense innovation.
What Undercode Say: š
The intersection of national security and tech startups is one of the most powerful innovation engines of our time. Undercodeās analysis of Norkinās insights paints a broader picture of where defense is heading ā and why startups are essential in that trajectory.
1. Defense as a Startup Ecosystem
Startups thrive in environments that reward speed, innovation, and adaptability. As defense becomes more tech-centric, with AI-driven surveillance, autonomous systems, and hybrid propulsion, the traditional barriers to entry are falling. Government agencies and militaries can no longer afford multi-decade procurement cycles when threats evolve by the month.
2. Israelās Dual Advantage
Israelās compulsory military service and strong academic institutions produce a unique blend of technical know-how and battlefield experience. This gives local startups not only credibility but also deep insight into real-world military challenges ā a competitive edge in global defense markets.
3. From Local Credibility to Global Scaling
Norkinās suggestion to first gain IDF approval is rooted in strategic branding. IDF endorsement acts as a gold standard for international buyers, signaling operational validation. While local sales may not bring high revenue, they are a gateway to lucrative exports.
4. Defense VC is No Longer Taboo
Historically, venture capital avoided defense due to ethical concerns or limited scalability. But as global defense budgets balloon and technologies like cybersecurity, space, and drone warfare go mainstream, VC attitudes are shifting. Defense is no longer a niche ā itās an opportunity.
5. Strategic Autonomy and U.S. Policy
The U.S.āIsrael aid framework has both empowered and limited Israeli industry. As aid restrictions tighten, the local industry must innovate and plan long-term ā something it failed to do post-2016. A renegotiated deal, tied to new regional threats and partnerships, is essential.
6. Global Trends in Fifth-Gen Warfare
While Israel is already leveraging autonomous and unmanned systems in real-time, much of Europe lags behind by two generations. This disparity opens the door for Israeli firms to export their technologies, serve as consultants, and shape international defense standards.
7. Government as Enabler, Not Bottleneck
The governmentās role should shift from direct funding to ecosystem building ā using public-private partnerships, innovation hubs, and sovereign wealth funds to stimulate growth. The success of Israelās cyber sector, once heavily backed by the state, proves this model works.
8. Startups vs. Legacy Contractors
Startups offer a culture of experimentation. In contrast, legacy contractors often operate on outdated paradigms. For governments needing fast solutions ā in drones, cybersecurity, or logistics ā the choice is becoming clearer.
9. AI, Lasers & Space: The Next Frontiers
Israel risks falling behind in emerging domains unless immediate investments are made. These areas are not just futuristic fantasies ā they will define national security in the 2030s. Ignoring them would be strategic negligence.
10. The Bigger Picture
Ultimately, war catalyzes innovation. While tragic, conflict often compels societies to reimagine what’s possible. The challenge for Israel ā and the world ā is to ensure that these innovations lead to long-term security, not just short-term advantage.
Fact Checker Results ā
š Norkinās statements about declining flexibility in the U.S.āIsrael aid agreement are factually accurate and traceable to the 2016 Memorandum of Understanding.
š Global defense budget increases, especially in NATO and Indo-Pacific regions, align with his projection of a defense-centric decade.
š Israeli startups are indeed increasingly being engaged by national defense bodies, confirmed by trends in VC defense portfolios and public sector collaborations.
Prediction š®
Expect to see a surge in dual-use technologies from Israeli startups ā innovations that serve both military and civilian sectors. As the defense-tech market matures, Israel is likely to evolve into a global testing ground and export hub for advanced warfare systems. Startups will not just support military readiness but redefine it.
References:
Reported By: calcalistechcom_9bf7a36b31c8a98157e21231
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