Sirens blared, families ran for shelter, and hundreds of Iranian drones and missiles filled the sky above Israel on a tense balmy June night. Yet the next morning, something striking happened: the Tel Aviv 35 index shrugged off its losses and closed higher. It was a quiet but unmistakable vote of confidence, from the markets – in a country under attack.
I speak from experience. In November 2012, I was showing two of our first US investors around Tel Aviv, introducing them to some of the stars of Israel’s startup landscape. I wasn’t worried about taking my guests to Tel Aviv because the city had not come under fire for more than 20 years.
After a successful afternoon with some impressive young entrepreneurs, we were on the highway back to Jerusalem when the eerie wail of air raid sirens sounded overhead, announcing the start of the first ever Hamas rocket attack on Tel Aviv.
Hard shoulder
I pulled over to the hard shoulder and directed my guests to lie down in the dirt by a wall as Israel’s Iron Dome defense system soared into action. We felt the sickening impact as three of the rockets fired by Hamas exploded a couple of miles from where we were taking cover.
After the skies fell silent, my guests picked themselves up from the ground, brushed off their Armani and Zegna suits, and climbed back into the car. When I arrived the next day, I opened my mouth to speak but one of them stopped me short.
“Jon, we must tell you that we’ve decided not to invest a million dollars. After what we went through yesterday, we’re going to invest two million dollars. If those guys from Hamas think they can intimidate us, they’ve never met a real New Yorker.”
Crisis breeds invention
That resilience isn’t new. For decades, Israel’s innovation economy has responded to crises not with retreat but reinvention. Startups haven’t missed payroll. Global investors haven’t pulled back – in fact, many are asking how to increase their exposure. War and uncertainty don’t slow down innovation here. If anything, they accelerate it.
Israel has long been a testbed for the technologies the world will need tomorrow. In the wake of the October 7th attacks and now under threat from Iran, we are seeing new waves of dual-use innovation: software that overlays live video with geospatial data to guide emergency responders; AI that monitors financial networks to flag illicit transactions and terror financing; advanced cooling systems for data centers that keep AI infrastructure running even under strain from climate or conflict.
These are not wartime stopgaps, they are the architecture of resilience. Technologies forged here are finding use far beyond Israel’s borders, from global financial institutions to disaster response teams to major cloud providers. What starts as necessity becomes a global standard.
It’s “business as usual” for OurCrowd, which continues to operate from the bomb shelters through the conficlts
Founders under fire
Our portfolio CEOs are taking Zoom calls from bomb-proof safe rooms during air raids. Engineers alternate between product sprints and military reserve duty. Teams shift responsibilities seamlessly across time zones when colleagues are called to the front. It’s not business as usual, but it’s business nonetheless.
Rather than pause or pivot, we see startups doubling down: launching products, hiring talent, closing deals. Flexibility isn’t a benefit in this environment – it’s embedded into the culture. This adaptability is exactly what draws investors back, again and again, in good times and bad.
The real risk is sitting on the sidelines
Geopolitical threats are real. But the bigger risk for investors isn’t exposure – it’s hesitation. Waiting for stability means missing the very moment when the strongest companies are forged. Innovation doesn’t stop when the sirens sound. It becomes sharper, faster, and more urgent.
That’s why, following Iran’s attack, we didn’t freeze. We reaffirmed our commitment to business continuity, supported employees in the field, and kept our pipeline of new investments flowing. The response from our global network was immediate: notes of encouragement, fresh capital, and crucially no redemptions. When you invest in resilience, moments of crisis don’t rattle you. They reaffirm your thesis.
What the world can learn from this moment
To policymakers: keep the channels open for cross-border collaboration.
To global companies now is the time to embed agile, crisis-tested innovation into your supply chains.
To fellow investors: history rewards those who back great founders in hard times.
Israel is bruised, not broken. Our answer to missiles and mayhem isn’t retreat – it’s to build smarter, faster, and with global impact. That spirit of stubborn optimism is the engine of progress, and the world needs it now more than ever.
Jon Medved is founder and CEO of OurCrowd, Israel’s most active venture investor
