Israeli Tech in Texas

The most underestimated economic story in America right now is the quiet convergence of the Start-Up Nation and the Lone Star State.
From the Office of the Governor of Texas, revised in November 2025: Israeli companies have invested $3.2 billion in Texas over the past decade. They have completed 34 foreign direct investment projects. They have created more than 4,200 jobs. Two-way merchandise trade between Texas and Israel reached $4 billion in 2024 — $757.9 million in Texas exports to Israel and $3.2 billion in imports from Israel. Israel ranks as the 19th-largest source country of foreign direct investment into Texas.
These are floor numbers. They capture only the formal foreign direct investment registry and merchandise trade flows. The full Israeli-founded business footprint in Texas — including startups, R&D centers, founder relocations, and acquisitions — is materially larger, and growing fastest in Austin and Dallas–Fort Worth. More than 40 Israeli tech founders have made Austin their U.S. base (Calcalist/CTech, January 2025), and the pace has accelerated since October 2023.
The story is built on three layers: an industrial spine of long-established anchor companies, an institutional layer of state-level partnerships built over twenty years, and a rapidly growing founder community choosing Austin as its U.S. base. 5W built this report to map all three.

1. The anchors are decades old, large, and defensible. Elbit Systems of America (Fort Worth, U.S. arm of Israel's Elbit Systems) supplies the U.S. Department of Defense. The Alon USA Energy legacy (founded by Israeli entrepreneur David Wiessman, merged with Delek US Holdings in 2017) operates a substantial Texas footprint. NICE Ltd. (NASDAQ: NICE) is identified by TxEDC among major Israeli companies operating in Texas.
2. The Austin founder surge is the new growth tissue. More than 40 Israeli tech founders have made Austin their U.S. base (Calcalist/CTech, January 2025). Companies include Next Insurance, Papaya Global, Quali, REE Automotive, and Somite (led by Chorus.ai founder Micha Breakstone, whose previous company sold to ZoomInfo for ~$575M in 2021).
3. Five structural factors — none dependent on a single political cycle. Zero state income tax. One of the most pro-Israel state governments in the country. Aligned industrial bases in defense, energy, aerospace, and aviation. The fastest-growing population of any large U.S. state. Dense community infrastructure compressing the time required to land and scale.
4. Texas's full footprint is materially larger than the FDI registry shows. USIBA has published comprehensive economic-impact studies for New York ($19.5B output, 57,000 jobs), Florida ($7.3B output, 8,190 direct jobs, 429 companies), and Virginia ($2.3B output, 119 companies). USIBA has not yet published a comparable Texas study. Triangulation suggests Texas's full footprint is in the same tier as Florida.
5. Capital infrastructure for Israeli defense-tech is now in place in Austin. Texas Venture Partners — a $50M Austin-based fund launched in 2024, led by Tal Shmueli (ex-IDF Special Forces, ex-LinkedIn) and Lorne Abony — invests exclusively in early-stage Israeli defense-tech startups establishing U.S. operations in Texas. Typical check size: $1M–$4M.
6. The 2026 trajectory is accelerating. American Airlines resumed nonstop JFK–Tel Aviv service on April 23, 2026, after a more-than-two-year suspension. DFW–Tel Aviv is on American's published 2026 fare schedule as a future addition. The April 2024 TAB–TVA–Startup Nation Central MOU formalized Texas–Israel commercial collaboration. The Texas-Israel Alliance, Consider Texas, and the Israeli Economic Mission to the Southwest entered 2026 with active program calendars.

On one side: the anchors. Elbit Systems of America in Fort Worth — defense, integration, program management. The Alon USA Energy legacy in Dallas — refining and retail fuel, now inside Delek US Holdings. NICE on the NASDAQ — analytics, customer engagement, compliance. Texas Venture Partners in Austin — a $50M fund built specifically for Israeli defense-tech.
On the other side: the Austin surge. Next Insurance. Papaya Global. Quali. REE Automotive. Somite. The Chorus.ai alumni who sold to ZoomInfo for ~$575M in 2021 and stayed. More than 40 Israeli founders building in a city one of them — Micha Breakstone, founder of Somite — described to Calcalist/CTech as "Israel without the PTSD."

The anchors are the spine. The surge is the growth tissue. Together they make Texas the most efficient U.S. landing zone for Israeli companies — and the corridor most U.S. CEOs are still underestimating.

"Israel is the Start-Up Nation. Texas has quietly become its scale-up partner. Energy, defense, cyber, AI — every sector where Israel leads is a sector Texas builds in. Israel uses AI more intensely than any country on earth — 4.9 times the global baseline, the highest rate in the world. From where I sit in Israel, the founders driving that intensity increasingly talk about Texas as one of the friendliest places in America for Israelis to build."

The 5W operating framework for the Texas–Israel corridor. Each factor is durable. None depends on a single political cycle. A company that lines up against all five compresses years off its U.S. land-and-scale timeline.

1. Factor 1: Zero state income tax and a business-friendly regulatory environment. Texas is the world's eighth-largest economy on a sub-national basis. The scale advantage few states can match.
2. Factor 2: One of the most pro-Israel state governments in the country. Texas was the first U.S. state to pass anti-BDS legislation, in 2017 — a position now adopted by more than 35 states. Governor Greg Abbott led an economic mission to Israel in January 2020.
3. Factor 3: Aligned industrial bases. Texas leads the United States in defense, energy, aerospace, and aviation — the same sectors where Israel exports innovation at scale. The Department of Defense's procurement footprint in Texas is the largest of any state.
4. Factor 4: The fastest-growing population of any large U.S. state. Texas adds more people every year than most U.S. states have in total. Customers, talent, and capital — the three things any expanding company needs — arrive in volume.
5. Factor 5: Dense community infrastructure. The Texas-Israel Alliance (operating since 2007), Consider Texas, the Israeli Economic Mission to the Southwest, the Texas Venture Partners fund, and the April 2024 TAB–TVA–Startup Nation Central MOU compress the time required for an Israeli company to land and scale.

Israeli companies in Texas concentrate in the sectors where Israeli innovation has scale and where Texas has industrial demand:

• Defense and aerospace — anchored by Elbit Systems of America in Fort Worth and accelerated by the Texas Venture Partners $50M Israeli defense-tech fund in Austin.
• Energy and cleantech — the Alon USA Energy legacy plus BIRD Foundation collaboration on Israeli energy companies.
• Cybersecurity — Israel originates 20%+ of global cyber venture funding; Texas's defense, financial services, and energy sectors are the deployment markets.
• AI and enterprise software — concentrated in Austin. Israel ranks #1 globally on the Anthropic AI Usage Index at 4.9x the global baseline (per the 5W–Louder joint study, Claude in Israel, April 2026).
• Mobility and advanced manufacturing — REE Automotive and others choosing Austin.
• Healthtech and life sciences — the Houston medical center and the Austin biotech corridor.

USIBA has commissioned independent economic-impact reports for Florida (2024), New York (2024), and Virginia (2024). USIBA has not yet published a comparable Texas state report. The figures below contextualize the Texas footprint within the broader U.S. picture.

• New York — 57,000 direct jobs / $19.5B total output (USIBA, 2024)
• Florida — 8,190 direct jobs / $7.3B total output / 429 companies (USIBA, 2024)
• Virginia — 2,400+ direct jobs / $2.3B total output / 119 companies (USIBA, 2024)
• Texas — 4,200+ jobs / $3.2B capital (Office of the Governor of Texas, 2025; FDI registry only)

The Texas figures reflect the formal foreign direct investment registry maintained by the Office of the Governor of Texas. A comparable comprehensive state-level economic-impact study has not yet been published. Triangulation across data sources suggests that the full Israeli-founded business footprint in Texas places the state in the same tier as Florida.

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