The drone exit from Ra’anana revealed: the serial investor has done it again

Defend has developed an interception system that locates drones, takes control of them remotely using radio waves and lands them safely. Its customers are civilians and not security forces, and for example its system is used in airports and even secured the Super Bowl game.

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Among the main beneficiaries of the large drone exit is the Vertex venture capital fund, which according to estimates owns 20% of the sold company and will receive over 300 million dollars in the deal. Vertex invested 6 million dollars in its first round of investment in Deepand, according to a company value of only 17 million dollars. According to the data of the finder website, Vertex funds (Ventures Israel and Growth Fund) also participated in the other two fundraising rounds carried out by Defend. As far as is known, this is a return of 17 times on the investment.

This is another great success for the group of funds founded and led by Yoram Oron (78), a veteran of the venture capital industry in Israel. He founded Vertex in 1997 as part of the “Yozma” program to encourage venture capital investments in Israel, and over the three decades in which the fund has been active, it has already invested in over 150 companies and made 47 exits (in companies whose total value reaches more than $22 billion).

About the successful exit in Defend, Oron wrote a post this week in which he described how Vertex became the first investor in the company, when the defense-tech field was not yet hot, “to say the least.” He stated that he connected from the beginning with the basic idea and the team of entrepreneurs who came with relevant experience to the solution, and said that although the market was not ripe, and the realization that the threat of drones would become a problem had not yet sunk in, he conducted tests and conversations and was convinced to invest.

It seems that Depand is an example of the ability of Oron, and Vertex in general, to identify successful companies at the beginning of their journey. Previous notable exits of the fund over the years include names such as the waze navigation application sold to Google in 2013, Actimize (financial risk management) sold to Nice in 2007, Argos (cyber for the automotive industry) sold to Continental in 2017, Voltaire (communications equipment) sold to Mellanox in 2010, Dynamic Yield (AI for decision making) sold In 2019 for $300 million to McDonald’s and Own (software) sold to Salesforce in 2024. And also companies that became public such as Solaredge, Cyberark (which was later sold to Palo Alto Networks) and Invis.

“Very proud of Defend”

In waze, for example, the Vertex fund held about 12% of the shares when the company was sold to Google for about $1 billion, and “met” with about $120 million. In Cyberark, she realized the holdings by selling shares after the company was issued on Nasdaq in 2014, at a respectable profit of 25 times the investment in the Israeli cyber security company. In an interview with Globes after it was sold last year to Palo Alto, Oron said that he first met the people of Cyberark “a month after the September 11 attacks in 2001. The atmosphere in the investment world and the mood were at zero level”. But at Vortex they decided to test the company anyway and were captivated by the charm of the founders – Udi Mokidi and Alon Cohen, and by the concept they proposed which was then not acceptable in the cyber world.

“In the end, no one knows how to predict what will happen in the future,” Oron said, when asked if he believed that the company would eventually be sold for more than $20 billion (years after the fund had already sold its holdings in it at a profit). According to him, “This is what is beautiful about good teams: they differ from ordinary teams in that they expand while moving, define new goals and new uses. There are few entrepreneurial teams who know how to make pivots along the way (changes in business direction) and bring in very good people.”

In a similar way this week, Oron referred to the path taken by the team of Defend, which is being sold to Motorola Solutions: “The company went through crises that resulted from changing technological challenges, buyers who changed their strategic concepts to new controllers and high costs of developing a deep tech product. Even after the company started selling and showing real value, there were times when it was difficult to raise the next round, and it needed a lot of support and faith along the way,” he wrote. “The entrepreneurs and employees of the company successfully faced the challenges, and made D-fend the leading company in the world in the soft takeover of drones. I am very proud of the company, the entrepreneurs and the way they did it.”

History at Arith Company

Before establishing the Vertex Foundation, Oron was a co-founder of the telecommunications company Telegate and served as its chairman until it was sold in 1999 to the American Trion. He is also the founder of Rashef Technologies, which developed thunderbolts for shells and was sold in the early 1990s to Arit Industries, which is now trading at a value of approximately NIS 3 billion. Oron served as CEO of Arit until the establishment of Vertex in 1997.

Vertex’s assets under management are $1.6 billion, and according to finder data, it focuses on investing in companies in the early stages of their lives, mainly in the areas of software, cyber security and health tech (technology for the world of health). Oron is a managing partner in the fund, along with other partners, including his son Yanai Oron; He is also a managing partner and co-founder of the venture capital fund Red Dot, which focuses on investments in companies at more advanced stages and manages assets to the extent of 765 million dollars. As of today, there are several companies that are marked as promising in Vertex’s portfolio, among them the financial planning software company Datarails, the cyber company Axonius and the AI ​​company for the medical world Navina.

Red Dot also had several successful exits, and according to the fund’s website, this includes the cyber security company Aramis, which was recently sold to the American software company ServiceNow in a huge deal of 7.75 billion dollars; Also in the fintech company Global-E, which is currently traded on Nasdaq – at the time of the IPO in 2021, the fund sold shares for about 68 million dollars, and about two years later sold the rest of the shares in exchange for hundreds of millions of dollars.

In an interview with Globes a few months ago, Oron was asked what characterizes a successful company, and he replied that “By and large, there is a mixture of talented, cohesive, goal-oriented people. These are very important qualities in the technology world. Success is of course also related to the ability to identify trends. Identifying trends in the technology world two or three years before everyone else – that’s the name of the game.”