Israel’s Next Tech Edge Is What Its Companies Know, Not What They Build

Look at the technology companies Israel has produced over the past two decades, and a pattern emerges. From cybersecurity and fintech to enterprise software and artificial intelligence, our founders have repeatedly taken complex technical problems and turned them into products with global markets. That ability to build has become a defining feature of our technology ecosystem.

I believe we are approaching a different kind of opportunity. As AI changes how enterprises operate, the competitive advantage may increasingly belong to companies that know how to turn technical expertise into repeatable business outcomes. The next generation of Israeli B2B leaders will need to do more than invent exceptional products. They will need to make the knowledge behind those products work at scale.

The opportunity beyond invention

Israel’s high-tech sector has substantial momentum. According to the Israel Innovation Authority’s 2026 report, industry output grew by 8.2% in 2025, exports reached $85 billion, and companies raised nearly $15 billion. Yet the same report points to a decline in domestic R&D employment for the first time in a decade and an increasing share of operations taking place abroad. I find this combination particularly interesting. Our companies are generating substantial economic value, but they are also becoming more internationally distributed. As teams spread across markets, the ability to preserve and transfer knowledge becomes a competitive consideration in its own right.

One example of the emerging opportunity is Haiku, an AI workflow documentation product developed by WalkMe, the Israeli-founded company acquired by SAP in 2024. Haiku captures digital workflows and turns them into step-by-step guides, addressing a problem that becomes increasingly difficult as companies grow: making practical knowledge accessible beyond the people who originally acquired it.

What interests me about this category is the underlying product idea. It takes something that traditionally exists in employees’ experience and makes it available as an corporate resource. That is a meaningful development in enterprise software, particularly for companies expanding beyond their founding teams.

Why Israel is well positioned

Israel’s tech ecosystem has several characteristics that lend themselves to this opportunity. Israeli founders have long built products for international customers because the domestic market is relatively small. This has encouraged an outward-looking mentality, with enterprise requirements and global competition influencing product development from an early stage.

This experience gives Israeli B2B companies an advantage in understanding the operational challenges of international expansion. Selling software in the United States and Europe involves considerably more than translating an interface. Companies need to support different workflows, integrate with established enterprise systems, accommodate regulatory requirements, and deliver consistent customer experiences across markets.

The technical capabilities that helped Israeli companies establish themselves in cybersecurity and infrastructure can also be applied to these challenges. Data integration, automation and AI provide the foundations, but understanding how customers actually work is what makes those capabilities commercially relevant.

AI makes organizational knowledge more valuable

The rise of generative AI has created an enormous opportunity to automate work. However, the most interesting question is not how many tasks AI can perform, but how effectively companies can give these systems the knowledge required to perform them correctly.

An AI assistant operating without reliable information about a company’s procedures, exceptions, and responsibilities will inevitably encounter limitations. The same applies to employees using AI. Access to sophisticated models does not automatically translate into better execution when people lack the practical knowledge to apply them.

This creates opportunities for Israeli companies building products around workflow intelligence, operational guidance, and enterprise automation. Rather than simply adding an AI assistant to an existing application, they can address the underlying problem of how expertise is captured, distributed, and applied.

For me, that represents an important distinction between technological novelty and meaningful enterprise innovation. The latter requires an understanding of the work itself, not just the capabilities of the software.

The human element remains essential

Even as automation becomes more sophisticated, people remain central to how enterprises operate. Employees need to understand unfamiliar applications, recognize exceptions and make decisions that cannot be reduced to a standard procedure.

This makes training and knowledge transfer important parts of any company’s technology strategy. The growing range of employee training tools illustrates how companies can deliver practical guidance without relying exclusively on conventional classroom instruction.

Israeli B2B companies have an opportunity to take this further by embedding learning directly into the software employees already use. Instead of expecting people to remember everything they have learned in a training session, businesses can make relevant guidance available at the moment a task needs to be completed.

That principle also applies to wider workforce development. Discussions of strategic workforce capability illustrate why organizations increasingly need to connect individual skills with broader operational objectives. For high tech companies, the ability to do that efficiently can become part of the product proposition itself.

The international dimension

For Israeli companies, the challenge of scaling internationally makes these capabilities especially relevant. A business with a relatively small headquarters can serve enterprise customers across several continents, but it must ensure that product knowledge and operational expertise are not concentrated in a handful of people.

This is where I see considerable potential for AI-enabled enterprise software. Systems that can capture established processes, make information accessible, and reduce reliance on manual knowledge transfer can help companies maintain consistency as their operations expand.

There is also an investment dimension. In her Forbes analysis of investor interest, Lisya Bahar Manoah highlighted Israel’s technical expertise and its record of turning innovation into commercially relevant solutions. I believe the next stage of that story will depend partly on whether companies can demonstrate that their products solve persistent operational problems, not simply introduce new technology.

Enterprise buyers are increasingly concerned with integration, adoption and measurable value. Israeli vendors that understand these requirements can build products that become deeply embedded in how their customers operate.

Yossi Barishev, founder and CEO of Way Security, for example, made a related point in his address for AI Defence Stack Day. He argued that AI hasn’t changed what organizations need to protect, but it has made every unresolved gap easier to find and exploit, which raises the price of leaving good tools half deployed. His point was about identity and access management (IAM), but it reaches well beyond security, and it explains why buyers now judge enterprise software by what it achieves inside their organization rather than by what it promises.

What the next phase requires

Israeli companies that establish themselves as global enterprise leaders will need to combine the engineering capabilities that built the ecosystem with a deeper understanding of how businesses function. Technical sophistication remains important, but it is not sufficient when customers expect reliable implementation, consistent support and demonstrable commercial results.

I believe this might carve an opportunity for a generation of B2B products built around the knowledge that makes organizations work. Workflow documentation, operational intelligence and AI-driven guidance may not attract the same attention as the latest foundation model, but they address persistent problems that every growing enterprise encounters.

We have already demonstrated its ability to turn difficult technical challenges into successful global businesses. Our next opportunity is to apply that same ingenuity to the knowledge, processes and expertise that allow those businesses to scale. The companies that succeed will not necessarily be those that invent the most technology, but those that make what they know increasingly valuable to the organizations they serve.