AI Funding Isn’t Slowing. Investors Are Just Playing The Long Game

From Israel to Silicon Valley, billions are flowing into AI. The cash proves confidence is excessive, even when payoffs take time.gettyMany headlines within the blazing world of AI usually inform a narrative of fatigue. Enterprises grumble about uneven ROI from their AI pilots, regulators press tougher on compliance and even startup founders whisper about inflated valuations. But behind the gloom, the cash hasn’t stopped flowing. Within the first half of 2025 alone, Reuters reported the worldwide startup funding climbed to $162.8 billion — and 64% of that worth was pushed by AI offers. From Silicon Valley to Tel Aviv, buyers are writing greater checks than ever, not as a result of they anticipate fast wins, however as a result of they’re betting lengthy.That stress — between delayed payoff and accelerated capital — is the place Glilot Capital Companions has staked its floor. The Israeli enterprise agency, lengthy ranked among the many world’s finest performers, simply introduced a $500 million increase throughout its Seed and Plus funds. In keeping with the VC, the transfer brings its property below administration to greater than $1 billion, whilst many different enterprise funds wrestle to shut new rounds. For co-founders Kobi Samboursky and Arik Kleinstein, the increase isn’t nearly market timing. It’s about conviction that AI and cybersecurity are removed from completed tales.Capital Retains Flowing Into AI And CybersecurityWhen requested why Glilot selected this second to lift such a big pool of capital, Samboursky acknowledged the overheated chatter however pushed again on the thought of retreat. “Some segments of AI is perhaps overheated, however our technique is purposefully focused. Cybersecurity is a sturdy, mission-critical class the place breakthrough expertise continues to create outsized returns,” he mentioned. “The brand new $500 million fund offers us the dry powder to again the best founders.”That self-discipline issues in a funding local weather the place capital is each concentrated and unforgiving. In keeping with Reuters, “AI investments drive 64.1% of complete deal worth in H1 2025,” with U.S. startup funding hitting $162.8 billion in simply six months. “I feel it’s downstream of the truth that OpenAI and Anthropic proceed to develop at unbelievable charges,” Davis Treybig, companion at Innovation Endeavors, informed Reuters.Glilot’s wager aligns with that gravitational pull. The place others see froth, the agency sees lengthy cycles of worth creation, particularly on the intersection of AI and cybersecurity — fields the place institutional buyers nonetheless anticipate constant development.Enjoying The Lengthy Recreation On ReturnsSamboursky is blunt about horizons. “This fund is designed for an extended time horizon. Whereas we’re lively in in the present day’s cybersecurity and AI momentum, our core thesis is long-term company-building,” he defined. “Israel has confirmed to be a constant supply of world winners in these fields, and we intend to proceed and again the following main gamers — supporting them from inception via scale, with disciplined capital and deep working assist.”Glilot Capital Companions teamGlilot Capital PartnersThis echoes a wider shift throughout the enterprise ecosystem. Analysts at FTI Consulting be aware that “in 2025, the extra sturdy AI-native firms will develop sturdy ARR, and buyers will steadiness portfolio threat by focusing funding in these firms with clear mid-term income and profitability potential versus these firms with extra long-term prospects.”The sample is obvious: Traders are usually not pulling again from AI, however they’re being extra selective, favoring startups with seen paths to sturdy returns. For Glilot, which means filtering for founders with deep area experience and proof of actual buyer ROI. As Kleinstein put it, “We search for clear buyer ROI, actual moats, sturdy safety/compliance from day one and a go-to-market that really scales.”Israel’s Enduring Function As A Tech PowerhouseThe geographic context issues as a lot because the capital. Regardless of ongoing regional tensions, Israel continues to draw international buyers in search of AI and cybersecurity and AI. “We deeply imagine within the Israeli ecosystem and can proceed to steer investments in the perfect native and international expertise,” Samboursky emphasised.Kleinstein framed the resilience extra immediately: “The ecosystem in the present day is exceptionally sturdy — repeat founders and operators with the imaginative and prescient, community and grit to construct international firms. Regional headwinds are there, and we’re constructive that the tensions subside quickly; within the meantime, groups are resilient and pragmatic: distributed hiring, multi-geo operations, and powerful international buyer ties. Internet-net, Israel stays probably the greatest locations on the earth to start out category-leading firms in cybersecurity and AI.”That conviction is backed by knowledge. Israeli startups accounted for almost 20% of world cybersecurity unicorns as of final 12 months, and the development has solely accelerated with AI-native approaches to protection. On this context, Glilot’s $500M increase is much less an outlier than a bellwether: International capital remains to be assured that Israel’s ecosystem can produce the following era of AI and safety giants.The place Traders Anticipate The Actual Winners To EmergeThe billion-dollar query, in fact, is the place the true worth will focus. For Kleinstein, the reply lies in cybersecurity and infrastructure. “Cyber Safety and AI (infrastructure and purposes) are our core. As of late we’re witnessing how AI creates main alternatives, broadly across the following three buckets: Defending AI; AI vs AI; and recreating present cyber domains with AI native approaches. Every one of many above classes will create large firms. That is the place our focus shall be.”He extends the logic additional: “AI is an enormous revolution and as such, it can seemingly create a number of winners in several layers of the expertise stack. In our case we imagine that we are going to see the winners within the cybersecurity/infrastructure layer. This aligns completely with our experience and the unmatchable ability set of the Israeli eco-system.”That perspective dovetails with broader investor sentiment. As Debra Aho Williamson, founder and chief analyst at Sonata Insights informed Reuters in a latest interview, “As firms like Alphabet and Meta race to ship on the promise of AI, capital expenditures are shockingly excessive and can stay elevated for the foreseeable future. It can purchase them extra time with buyers and supply confidence that the billions being spent on infrastructure, expertise and different tech-related bills shall be worthwhile.”In different phrases, the capital wager just isn’t on quick shopper wins however on the infrastructure and protection layers that hold the AI financial system working.The hole between what buyers anticipate and what they get has been the defining characteristic of AI investing over the previous three years. However for companies like Glilot Capital, that hole isn’t a warning signal; it’s a chance. By specializing in cybersecurity and enterprise infrastructure, they’re p placing themselves able the place the delayed returns might finally be essentially the most sturdy. As Samboursky put it, “This new capital not solely validates our previous efficiency but additionally empowers us to proceed and develop our cyber and AI philosophy.”The billions pouring into AI might not ship immediate wins. However they do reveal one thing crucial: Traders are now not betting brief. They’re constructing for the long run.