Introduction

Protego Ventures, the Israeli defense tech firm founded by Lital Leshem and Lee Moser, has closed its debut fund at $125 million, marking a significant moment as defense and venture capital increasingly intersect. The two-year-old company presents itself as the first and largest dedicated defense tech VC in Israel.

What Happened

Defense tech venture capital saw record dealmaking in Q1 2026, and Protego Ventures just completed the final close of its debut fund with $125 million in capital commitments. The fund enables investments between $5 million and $50 million per company, focusing on startups addressing critical defense and security needs. Key portfolio companies include XTEND, a drone maker that recently went public on the NYSE, and ASIO, which develops situational awareness systems partnered with Anduril.

Why This Matters

The closure of Protego's debut fund highlights how defense tech is becoming a focal point for venture capital, traditionally dominated by government contracts and large primes. With geopolitical tensions rising and Israel's defense needs evolving, a dedicated VC fund that can move quickly and back early-stage innovation is significant. The involvement of established firms like Ares Management validates the sector's growth potential.

Key Takeaways

  • Protego Ventures closed its debut fund at $125 million, below its $150 million target, choosing to preserve upside from concentrated wins.
  • The fund is led by two women, Lital Leshem and Lee Moser, and backed by Ares Management and Israeli institutional investors.
  • Portfolio companies include XTEND and ASIO, reflecting a focus on drone technology and situational awareness for defense applications.
  • The founders' deep ties to Israel's military and intelligence sectors inform their investment thesis, and the firm is already planning a second fund in Q1 2027.
  • Government-backed VC guarantees in Israel signal growing state interest in defense tech, but Protego's momentum shows private capital is already moving fast.

Conclusion

Protego Ventures' successful close of a $125 million debut fund marks a notable moment in the convergence of defense and venture capital. With strategic investments, experienced leadership, and a clear roadmap for expansion, the firm is positioned to shape the next wave of defense innovation in Israel and beyond. As the sector attracts more attention from both private and public capital, Protego's focused, founder-led approach may become a template for how defense tech VC scales in the coming years.