Protego Ventures finalizes debut fund at $125 million for Israeli defense tech

Protego Ventures has completed the final close of its debut fund at $125 million, according to exclusive information from TechCrunch. The firm is known as Israel's first and largest venture capital investor dedicated solely to defense technology.

The two-year-old firm, led by Lital Leshem and Lee Moser, raised $70 million at its initial close before adding the remaining $55 million, deliberately stopping short of its $150 million target. The smaller fund size magnifies the impact of a single successful exit on overall returns. "Nobody wants to share the pie," Leshem said, referring to the potential upside from portfolio company XTEND's recent NYSE listing.

The fund will invest between $5 million and $50 million per company, focusing on startups addressing critical defense and security needs for Israel and the global community. Ares Management, one of Protego's largest backers, committed $30 million as a limited partner after suggesting the two founders join forces following the October 7, 2023 Hamas attack on Israel.

Protego's portfolio includes XTEND, which went public on the NYSE at a $1.5 billion valuation; ASIO, which develops situational awareness systems and has partnered with Anduril; Prisma Photonics, which converts fiber-optic infrastructure into large-scale sensing networks; and Rilian, which applies AI to cyber tasks in restricted computing environments.

The firm is already planning a second fund for the first quarter of 2027, with backing from Israeli institutional investors and a large US commitment already secured. That vehicle will broaden the scope to include early-growth American defense technology companies.