Israel Picks Adir Capital and SLING CAPITAL for State-Backed Defense Funds

Israel has selected Adir Capital and SLING CAPITAL to establish state-guaranteed venture capital funds dedicated to advanced defense technologies, the Ministry of Finance and Ministry of Defense announced.

The Accountant General's Division at the Ministry of Finance and the Ministry of Defense's Administration for Research and Development of Weapons and Technological Infrastructures (MAFAT) jointly announced the tender outcome. Adir Capital comes from Idan Financial Instruments. SLING CAPITAL comes from Giza.

A committee headed by Gil Cohen, Senior Deputy Accountant General and Director of the Financing Division, oversaw the competitive selection process.

What will the funds do?

The two vehicles will make strategic investments in defense technology. The ministries set out four stated objectives:

• Strengthen Israel's technological, industrial and security independence
• Develop critical supply chains
• Support economic growth
• Create jobs

The initiative targets a specific gap: a shortage of venture capital for security-related fields that involve high production requirements and significant investment risks. The ministries said the need has become more acute amid the war and broader geopolitical changes.

The selection forms part of the Defense Ministry's strategy to connect three players: the defense establishment, private capital and Israel's technology ecosystem. The government said the mechanism should give defense-technology startups greater investment capacity while reinforcing domestic technological and industrial capabilities.

Why state guarantees?

The state guarantee sits at the center of the model. Gil Cohen, who chaired the tender committee, said the guarantee would serve as a mechanism to leverage investment in defense technology. He said the winning proposals demonstrated professional knowledge and proven capabilities, and expressed confidence that the funds would contribute to the development of Israel's defense-tech market.

Israel Malachi, Director General of the Ministry of Finance, framed the guarantees as a way to unlock capital that private investors would otherwise withhold. He said the guarantees would enable greater investment in advanced technologies while supporting Israeli companies and entrepreneurs and strengthening technological and production independence.

Accountant General CPA Michal Abadi Boyanjo said state-guaranteed funds are a strategic tool for encouraging economic growth. She said the initiative would support local entrepreneurship, technological and industrial independence, and critical supply chains — both during emergencies and in routine periods.

How does this fit Israel's defense strategy?

Maj. Gen. (Res.) Amir Baram, Director General of the Ministry of Defense, called the establishment of the funds a milestone in the ministry's strategy to develop Israel's defense-tech ecosystem. He said that after three years of war, increased investment in research and development is necessary to preserve the defense system's qualitative-strategic advantage and develop new technologies.

Brig. Gen. (Res.) Dr. Danny Gold, Head of the Defense Intelligence Agency at the Ministry of Defense, said the funds would strengthen Israel's technological capabilities by connecting private capital, innovation and the needs of the defense system. He said the initiative would support Israeli startups and entrepreneurs while contributing to the country's productive independence.

The initiative reflects the Israeli government's broader effort to use public financial mechanisms to attract private capital into defense technology. The ministries said the model is designed to strengthen cooperation between government, the defense establishment, financial markets and local entrepreneurs.

What happens next?

The two funds will spend the coming months completing the recruitment of investors before they begin operations. The ministries expect both firms to close their investor bases before launch.

The timetable matters. Baram's reference to three years of war signals the government's urgency: the funds are meant to convert private capital into research and development capacity at a moment when Israel's defense establishment considers technological superiority a strategic necessity, not a luxury.