'Whether you like it or not': The Israeli VC on who's really buying Israeli tech

In this episode of the Defense and Tech Podcast, Anna Ahronheim interviews Yoni Heilbronn, co-founder and managing partner of IL Ventures, a Tel Aviv-based venture capital firm focused on disruptive technology for legacy industries including logistics, smart manufacturing, robotics, and supply chain. Heilbronn emphasizes that the world order that prevailed for nearly 80 years post World War II is no longer the case, with globalization giving way to the potential for instant re-pricing of entire industries through tariffs, wars, or a few shots fired at cargo ships by individuals in Yemen.

Heilbronn notes that European officials outwardly state certain viewpoints while private purchase orders continue to target Israeli companies. He also dismisses the notion that the surge into defense technology is a temporary fad or a bubble, expressing both perspectives. Germany, for instance, has allocated over $100 billion, but Heilbronn highlights the lengthy sales cycles, even longer development cycles, and the scarcity of integrators needed to drive exits that are typically sought after by venture capital funds.

Additionally, governmental entities present another major obstacle: the slow pace of tenders and purchasing departments that startups cannot afford to wait for.

The interviewee delves into the technical aspect by demonstrating how he hacked a car's head unit in a Tel Aviv office and swiftly accessed the manufacturer's corporate network. He discusses the importance of data centers being located underground for security reasons, recommends Israeli founders consider establishing operations in countries like Mexico and Brazil over New York, and shares an intriguing example of one of his portfolio companies using advanced technology to age whiskey in just weeks. He concludes by stating that within every challenge lies an opportunity.