Protego Ventures completes $125 million Israeli defense fund
Protego completes first defense technology fund
Protego Ventures has completed the final close of its debut fund with $125 million in capital commitments, creating a dedicated pool for Israeli defense technology startups. The two-year-old venture firm, led by Lital Leshem and Lee Moser, describes itself as the first and largest dedicated defense-tech venture capital investor in Israel.
The fund will invest between $5 million and $50 million per company in businesses addressing defense and security needs in Israel and internationally. Protego had targeted $150 million, but Leshem said a smaller vehicle increases the impact that a major portfolio exit can have on returns for its investors.
XTEND listing shapes the fund strategy
Drone maker XTEND was Protego’s first portfolio company and went public on the New York Stock Exchange earlier this month. Leshem described the company as a potential “fund maker”, meaning one investment could return the whole fund. Raising additional capital, she said, would spread that upside across a larger investor base.
Ares Management is among Protego’s largest backers and committed $30 million as a limited partner. Leshem said Ares encouraged her and Moser to establish the firm following the Hamas attack on Israel on October 7, 2023, when they concluded that emerging technologies would be central to strengthening Israel’s defense capabilities against new threats.
Protego’s investments also include ASIO, a developer of situational-awareness systems that has partnered with Anduril. Leshem brings 11 years of military and intelligence experience, while Moser remains a managing partner at generalist venture firm AnD Ventures. The founders are using their networks to engage with military stakeholders and technology companies in Israel’s defense sector.
A more crowded market for military and dual-use capital
Protego is entering a market that is attracting more specialized investors. Israeli authorities have awarded Adir Capital and Sling Capital roughly $33 million in state guarantees for investments in military and dual-use technologies. Leshem said Protego did not participate in that tender because its own fundraising was already too advanced.
The firm is already preparing a second fund for the first quarter of 2027. Protego expects that vehicle to include support from Israeli institutional investors and a large U.S. commitment already secured by Leshem, while broadening its remit to early-growth American defense-tech companies.
For companies seeking defense-focused financing, Protego’s close illustrates the value of matching a capital partner’s ticket size, sector specialization and access to relevant operational networks with the company’s stage and market requirements.