The qualitative advantage: How Israel became a defense-tech powerhouse

As we move between shelters and while the world is still trying to process the pace of events in the Middle East, professionals in military headquarters and defense research institutes watch with astonishment the technological display Israel is showcasing in Iran and Lebanon—one that has perhaps never been seen before on the modern battlefield.

From the unprecedented performance of the Air Force, through precise real-time intelligence analyzed with artificial intelligence, to the multi-layered air defense system that withstood tests no one had imagined—Israel has demonstrated remarkable technological superiority, far beyond what might be expected from a country of its size.

In fact, the current campaign—from October 7 to “Lion’s Roar”—has made Israel the world’s largest and most significant testing ground for advanced weaponry: a kind of massive beta site. Technological initiatives developed among reservists in the field—many of whom are engineers and professionals leading high-tech companies and defense industries in civilian life—have quickly advanced through development stages and become operational during combat itself.

Very few countries in the world are capable of shortening the gap between idea, testing, and deployment this way.

This fast-track pathway for entrepreneurs—where developed technologies reach the heart of critical IDF systems in just a few months—did not appear out of nowhere. In recent years, the defense establishment has effectively tapped into the creativity of Israeli high-tech through institutionalized “open innovation” mechanisms that deliver precise responses to operational needs.

This revolution is evident in the support for startups through accelerators, funds, and dedicated incubators, and the numbers speak volumes: according to a Directorate of Defense R&D (MAFAT) report, in 2025 the unit worked with 302 startup companies—mostly small and medium-sized enterprises—spending a total of 4.6 billion shekels on orders. This represents one of the most extensive interfaces in the world between the military and startups.

At the same time, defense R&D laboratories continuously work on solutions for the battlefield of the future. The scope is broad—from precision missiles and autonomous drones to space-based observation systems and ground and naval robotics, as well as deep integration of artificial intelligence and quantum computing—alongside a series of breakthrough developments that, naturally, remain far from the public eye.

At the core of Israel’s significant technological edge is primarily human capital. This is the distinctive element that characterizes Israeli high-tech overall and defense technology specifically—and it also serves as the link between them. In cybersecurity, for example, without the highly skilled personnel transitioning from elite tech units to the civilian sector, Israel would not have been able to establish itself as a global leader.

This deep symbiosis—combining the creativity of the “Start-Up Nation” with the operational needs of the IDF—gives a decisive strategic advantage and technological edge on the battlefield. It is the Israeli “secret sauce” that fascinates the world: the ability to harness the brightest human talent—graduates of elite programs like Talpiot, Psagot, and Odem—and provide them with the platform to transform an abstract idea into a life-saving operational tool.

But defense innovation doesn't stop in the laboratory or on the battlefield. To maintain a technological edge over time, a system is needed to safeguard the knowledge itself. Here lies another layer—hidden from view but equally important—the legal protection of these assets.

Every system developed in Israel benefits from a comprehensive intellectual property protection framework designed to guarantee exclusivity over Israeli technology. As professionals in this field, we see firsthand how systems are safeguarded by numerous patents. It is no coincidence that Israel’s three leading defense companies consistently rank among the top patent filers, as shown in the annual reports of the Patent Authority. This is how we ensure that our technological leadership is not only created in Israel but also stays in Israeli hands.

Alongside the major defense industries, small and medium-sized enterprises also operate—and they play a vital role. They offer flexible and quick responses to urgent military needs and act as catalysts for technological innovation. Today, about 1,200 such companies work across a wide range of fields.

These companies produce a wide range of products: electro-optical systems for object detection, drones and reconnaissance vehicles, systems for data analysis and processing using unmanned aerial platforms, and many other diverse innovations.

The strong bond between developers and end-users, quick responses to operational needs, and proven operational experience also help promote the international sales of Israeli defense products. It's not surprising that Israeli exports keep setting new records each year. Israel is now one of the five largest exporters of weapons and defense systems worldwide—and even countries that threatened boycotts over the war in Gaza continue to buy Israeli arms.

Israel’s defense-industrial complex was born out of necessity. The embargoes imposed by major powers on arms exports to Israel in its early years — it’s hard to recall today that it was specifically the United States and Britain that limited arms shipments to the Middle East in those initial days of the state — compelled Israel to build an independent domestic industry. The French embargo of the 1960s served as another catalyst for self-reliance.

What started as a fix for a particular hardship has, over the last eighty years, expanded into a strong ecosystem that's transforming the modern battlefield.

So what will the future look like?

The global technological landscape is undergoing rapid change, fundamentally altering the nature of threats. New technologies—some originating from the civilian sector—are transforming the battlefield: from artificial intelligence and quantum computing, through biomedical advances, to new energy sources and autonomous and robotic systems. Israel will need to quickly incorporate these developments into its systems, understanding that civilian technologies will significantly impact national security.

One thing I am certain of is that the synergistic combination of accumulated knowledge, high-quality human capital, and engineering excellence—hallmarks of Israel’s defense industries over the years—provides an ideal platform for leading defense innovation. Israel’s demonstrated capabilities in developing complex defense systems will act as a catalyst for groundbreaking innovation.

Israel’s founding fathers understood that the gap in numbers between Israel and its enemies was huge—and that survival in the surrounding Arab-Muslim world would only be possible by closing the qualitative gap. As David Ben-Gurion, Israel’s first Prime Minister and Minister of Defense, stated, “From all this follows the necessary direction in organizing our army, its equipment, and its training. Since we are inferior in quantity—we must excel in quality.”

The author is the CEO of the Luzzatto Group, Israel’s oldest and leading intellectual property firm, celebrating 157 years since its founding. She is also the recipient of the 2025 "Ben-Gurion Award" from Ben-Gurion University of the Negev.