“Israel will remain a cyber powerhouse for the next decade” CapitalG’s James Luo bets on resilience, AI, and a new wave of Israeli tech IPOs. “Israel will remain a cyber powerhouse for the next decade,” says James Luo, a general partner at CapitalG, the growth investment arm of Alphabet. CapitalG has invested in several Israeli cybersecurity companies, including Armis Security, Salt Security, and Orca Security. Luo says that, following the major acquisitions of Wiz, CyberArk and Armis in the sector, more Israeli companies are likely to pursue public listings in the United States. Founded a decade ago, CapitalG aims to connect entrepreneurs with Alphabet’s expertise in scaling technology companies. Israel is currently facing a period of heightened geopolitical tension, including attacks from Iran and Lebanon. Asked whether this affects the fund’s strategy, Luo is unequivocal. “Israel has always punched above its weight in technology, and especially in cybersecurity,” he says. “The ecosystem here is unique. I’m not a prophet, but I’m convinced that the global cyber industry will continue to be shaped by what comes out of Israel over the next decade. We will continue to invest here aggressively. “We meet Israeli entrepreneurs all the time, and our feeling is that there is a huge opportunity here. The amount of innovation relative to the size of the country is simply phenomenal.” Luo argues that companies established before the current wave of artificial intelligence may, in some cases, be better positioned than so-called “AI-native” startups. “The concept of ‘AI-native’ is often just a matter of timing, essentially, companies founded after November 2022,” he says. “In practice, many of our portfolio companies have integrated AI deeply into their operations. That, to me, is what really defines an AI-native company.” He describes the current environment as one of “creative competition,” where startups benefit