NEXT 2026 Summit: Why 2026 Will Be the Year of Proof for Israeli Tech

At the recent NEXT 2026 Summit, one message stood out clearly: Israeli investors are preparing for a year that will require startups to deliver far more than a strong pitch deck. The poll, conducted among dozens of leading venture capitalists and unveiled during the event, presents a sharp picture of how the VC community views the road ahead, and what will separate the companies that continue scaling from those that will struggle.

One of the most striking findings relates to the current hype around AI. While the field continues to dominate both the conversation and the flow of capital, nearly 40% of investors describe it as “overheated.” The takeaway is clear: to thrive in 2026, AI companies will need more than a compelling idea. They will need product maturity, real-world use cases, and measurable results. The category remains hot, but investor confidence is no longer automatic.

On the fundraising front, the biggest challenge for startups in 2026 won’t be locating investors, it will be standing out in an increasingly crowded and noisy market. More than two-thirds of respondents said differentiation will be the most critical hurdle in the year ahead. At the same time, roughly one-third of investors believe valuations will rise in 2026, signaling cautious optimism tempered by the recognition that market volatility is far from over and that not all companies will benefit equally.

Another revealing insight emerges in the cybersecurity sector, where Israel continues to play a leading global role. Despite the abundance of similar companies, investors do not anticipate a slowdown. Instead, they foresee a structural shift: consolidation on one side, and strong growth among differentiated companies addressing new threat landscapes on the other. The message is unmistakable — Israeli cybersecurity will continue expanding, but not for every player in the market.

The poll also underscores what investors value most today: data. Consistent traction emerged as the top factor in funding decisions, outweighing market size, brand strength, and even technological uniqueness. In parallel, preferred business models are those that generate recurring and predictable revenue, with strategic partnerships playing an increasingly significant role in valuation and signaling market validation.

Taken together, these findings suggest that 2026 will be a year defined by clear differentiation, proven performance, and disciplined focus. Investors remain positive about the future of Israeli innovation — but expect real, stable, and measurable value in return.

Gerson Panitch. Photo by Bar Cohen

NEXT 2026 Summit

More than 600 founders, investors, and industry leaders gathered in Tel Aviv for the first live edition of NEXT 2026 Summit, the flagship event of the What’s Next in Israel Tech initiative, launched following the events of October 7 to showcase the strength and creativity of Israeli innovation. Since its inception, the initiative has published nearly 100 short video interviews with Israeli startup CEOs, with all production costs fully funded by Finnegan as a social impact effort.

The summit, held in partnership with Finnegan Israel, brought together over 50 venture capital firms and more than 200 startups, offering an in-depth look at the challenges and opportunities shaping 2026. In his opening remarks, Gerson Panitch, Founder and Host of What’s Next in Israel Tech and Managing Partner at Finnegan Israel, emphasized the critical role of well-crafted intellectual property in building competitive advantage and attracting investment, and explained how strategic IP planning directly impacts company valuation.