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  1. Israel’s AI sector emerging as a pillar of the country’s tech ecosystem. Currently, approximately 25% of Israel’s tech startups are dedicated to artificial intelligence, according to The Jerusalem Post, with these companies attracting 47% of the total investments in the tech sector (Startup Nation Finder). This strong presence highlights Israel’s focus on AI-driven innovation and entrepreneurs’ belief in the growth opportunities related to AI. The Israeli AI market is expected to grow at a compound annual growth rate of 28.33% from 2024 through 2030, reaching a value of $4.6 billion by 2030 (Statista). This growth is driven by increasing demand for AI applications across diverse industries such as health care, cybersecurity, and fintech. Government-backed initiatives, including the National AI Program, play a critical role in supporting startups by providing accessible and non-dilutive funding for research and development (R&D) purposes. Despite facing significant challenges since the start of the war in Gaza, Israel has continued to produce cutting-edge technologies that are getting the attention of global markets. Additionally, Israel’s highly skilled workforce and partnerships with academic institutions provide a steady supply of talent to meet the sector’s demands. With innovation, resilience, and collaboration at its core, the Israeli AI landscape is poised to remain a global force in 2025 and beyond.
  2. Mergers and acquisitions to remain a cornerstone of dealsAccording to IVC Research Center, 47 Israeli AI companies successfully completed exits in 2024, showcasing the global demand for AI-driven innovation. Investors are continually identifying the differences between companies whose foundations were built on AI, versus those leveraging AI to enhance other core elements of their value proposition—sometimes only marginally. Savvy buyers look beyond the “AI label” and seek out companies with genuine, scalable AI solutions rather than superficial integrations, understanding that value lies in robust and transformative applications. AI is also sector agnostic and may disrupt virtually every vertical. From health care and finance to retail and manufacturing and others, numerous industries are increasingly leveraging AI to enhance or even change their core competency to gain competitive advantages. Deals in this space are coming from strategics such as automobile manufacturers, banks, digital marketing companies and life science firms, among others. As AI continues to permeate multiple sectors, Israeli companies are poised to receive increased attention from strategic M&A buyers looking to unlock new technologies and business opportunities in the market.
  3. Intersection of PropTech and AI to further revolutionize the global real estate industry. Israeli innovation is expected to be at the forefront of this trend. According to IVC Research Center, over 70 PropTech companies headquartered in Israel are leveraging AI to develop cutting-edge technologies that are reshaping the industry on a global scale. We anticipate these companies will continue advancing AI-driven tools and third-party solutions to streamline acquisition strategies, enhance underwriting processes, and drive operational efficiencies. By harnessing AI to identify leasing opportunities, forecast rental trends, and optimize costs, Israeli PropTech firms are set to solidify their position as global leaders in real estate innovation in the year ahead.
  4. AI to become increasingly important across global industries. Israeli companies have demonstrated genuine thought/R&D leadership in AI innovation. Some of the AI-centric legal trends that may stand out in 2025 include (1) a greater focus on data rights management as Agentic AI continues to carve new learning standards; (2) regulatory advancements in science, highlighted by two AI-related Nobel Prizes in science, that will likely materialize in the U.S. Food and Drug Administration adopting new rules for AI-driven drug approvals, as well as new AI patenting standards and requirements; (3) greater emphasis on responsible AI usage, particularly around ethics, privacy, and transparency; (4) the adoption of quantum AI across many industries, including in the area of securities trading, which will likely challenge securities regulators to address its implications; and(5) turning to AI-powered LegalTech strategies (both in Israel and in other countries). Israeli entrepreneurs are likely to continue working within each of these industries and help drive the AI transformation wave.
  5. AI-based technology to continue changing how companies handle recruitment and hiring. While targeted advertising enables employers to find strong talent, and AI-assisted resume review facilitates an efficient focus on suitable candidates, the use of AI to identify “ideal” employees and filter out “irrelevant” applicants may actually discriminate (even if unintentionally) against certain groups protected under U.S. law (for example, women, older employees, and/or employees with certain racial profiles). In addition, AI-assisted interview analysis may inadvertently use racial or ethnic bias to eliminate certain candidates. Israeli companies doing business in the United States should not assume their AI-assisted recruitment and hiring tools used in Israel will be permitted to be utilized in the United States. Also, Israeli companies should be mindful of newly enacted legislation in certain U.S. states requiring companies to notify candidates of AI use in hiring, as well as conduct mandatory self-audits of AI-based employee recruitment and hiring systems. AI regulation on the state level in the United States is likely to increase, and Israeli companies that recruit and hire in the United States will be required to balance their use of available technology with applicable U.S. legal constraints.

About the Authors:

Greenberg Traurig’s Tel Aviv office is a key hub for the firm’s international operations, providing a wide range of legal services to both Israeli and international clients. The office works with clients in a myriad of industries, delivering services in areas such as corporate law, mergers and acquisitions, venture capital, capital markets, global real estate, employment, litigation and global tax. This 5 Trends article was authored by Managing Shareholder Joey Shabot, who focuses on corporate transactions and has deep experience advising global companies on their investments in Israel; Shareholder Lawrence Sternthal, who focuses on global real estate transactions; Shareholder Meira Ferziger, known for her work with Israeli companies on their U.S. employment matters; and Shareholder Adam Snukal, who handles technology transactions, advising technology companies on licensing, commercialization, and protection of their intellectual property assets. The team of experienced lawyers is dedicated to providing high-quality legal services and innovative strategies for complex legal challenges.

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Photo of Joey Shabot ^ Joey Shabot ^

Joey T. Shabot is the Managing Shareholder of the Tel-Aviv office and focuses his practice on mergers and acquisitions, including corporate law, securities law and financing. His experience includes advising on mergers, acquisitions, joint ventures, partnerships, securities offerings and private placements, in transactions…

Joey T. Shabot is the Managing Shareholder of the Tel-Aviv office and focuses his practice on mergers and acquisitions, including corporate law, securities law and financing. His experience includes advising on mergers, acquisitions, joint ventures, partnerships, securities offerings and private placements, in transactions involving companies across a variety of industries throughout the world including the U.S., Israel, China, Japan, Europe, and Latin America.

Joey also dedicates himself to pro bono work in which he represents United Hatzalah, an international first response organization, the global WIZO organization, and other global charities.

^ Attorneys in the Tel Aviv office do not practice Israeli law.

Photo of Meira Ferziger ^ Meira Ferziger ^

With nearly 30 years of employment law experience, Meira Ferziger has provided legal counsel to hundreds of Israeli start-up companies hiring employees in the United States. Meira has accompanied such companies from their first step into the U.S. market, through the process of…

With nearly 30 years of employment law experience, Meira Ferziger has provided legal counsel to hundreds of Israeli start-up companies hiring employees in the United States. Meira has accompanied such companies from their first step into the U.S. market, through the process of remotely managing U.S. employees on a day-to-day basis in accordance with applicable laws, and she has provided invaluable professional and practical counsel to such clients during capital funding, merger & acquisition, and IPO stages.

Based in Greenberg Traurig’s Tel Aviv Office, Meira focuses on the individual needs of particular companies, preventative strategies and litigation avoidance. She guides clients through the development and implementation of employment policies and practices in light of applicable local, state, and federal laws, and advises clients as to minimizing the risk associated with terminating employees, including potential discrimination, unjust dismissal, and/or breach of contract claims. Meira also plays a central role in advising clients with respect to the employment aspects of corporate transactions, including the preparation and negotiation of employment and retention agreements for key employees in connection with such transactions.

^ Attorneys in the Tel Aviv office do not practice Israeli law.

Photo of Adam Snukal^ Adam Snukal^

Adam Snukal’s practice is primarily focused around the centrality of technology across many verticals and industries, with an emphasis on health care, FinTech, privacy, cyber-security, Ad-Tech, entertainment, IT/cloud infrastructure, outsourcing and Aerospace/ New Space. Mr. Snukal also regularly counsels clients on their global…

Adam Snukal’s practice is primarily focused around the centrality of technology across many verticals and industries, with an emphasis on health care, FinTech, privacy, cyber-security, Ad-Tech, entertainment, IT/cloud infrastructure, outsourcing and Aerospace/ New Space. Mr. Snukal also regularly counsels clients on their global privacy and data security compliance obligations, such as GDPR, HIPAA, CCPA, PCI, and more. Mr. Snukal’s clients range from large multi-nationals to emerging growth companies.

Mr. Snukal is both a frequent speaker and author of numerous articles on topics related to technology, advertising, media and the law.

^ Attorneys in the Tel Aviv office do not practice Israeli law.