Before we start today's episode, here's a word from our sponsor. I'm sure some of you are already familiar with the sponsor of this episode. That is Sapir, the free quarterly journal of Jewish ideas, edited by Brett Stevens. And I'm excited to share that the next issue will feature an article by yours truly. Yes, alongside our VP R&D at Alenu, Shaha Lutan, him and I wrote an article about how Israel can make itself indispensable to the global economy and very much looking forward to seeing it being published in the next issue of Sapir, which will be out shortly. Be sure to sign up for free today so that your subscription begins with the very next issue on the theme of aspiration. I know Dan always says on Call Me Back that they should be charging for it, but fortunately it is still available for free in print for all subscribers in the US. So, please go on sapirjournal.org/whatsyournumber. No apostrophe to sign up. That's sapirjournal.org/whatsyournumber.
So, what's your number?
My number is really simple this week. It's $1 billion. Yep. It's very catchy. Also, the amount raised by Israeli startups in all of January of this year alone, just in 2026. So, I'm counting around 24 local startups that raised more than $1 billion together. And it's the strongest January for Israeli tech since 2022. So, that's my number. Yonathan, what's yours?
Mine is eight. That's Danny Avdia's number. It's the first ever Israeli NBA all-star. The thing that I'm focused on is that the ultimate kind of immune system to AI or the ultimate winner in an AI world is professional sports. Committed to it at a family level where like we're enjoying the kids kind of trying to excel in different fields. I do believe this is going to be impactful. And I think that Danny's first time all-star in Israel ever in history is a sign. It's an inspiration and I think that the economic dynamics around professional sports are going to be something that Israel is going to excel at because right now we're at a pretty inferior point. So I'm celebrating whatever is out there when it comes to Israeli professional sports.
I think your number wins at the end of the day. To me the number to beat this year is 80 billion.
That was the total sum of M&As and exits last year. But starting off the year with 1 billion raised in January is like science fiction considering what we went through.
All right, it is 5:00 p.m. here in Israel by the way. So from your perspective, 1 billion big enough? You would want it to be bigger. Again, considering the 80 billion in which the year ended in 2025.
$1 billion is by all standards a huge number collectively to raise. But I did just see a report recently that shows that investors can't invest enough in cyber because it's growing so fast and the expenses that enterprises are spending on cyber security products is far outperforming the investor money going in. So $1 billion does sound like a lot and it is a lot but it's still less than what enterprises themselves are spending.
It's interesting. That's kind of like the mirror image of AI, right? Where most of the funding and most of the capital creation is funding going into companies. It's a very interesting metric. What outpaces what? That's a great angle on that. It's interesting. I never thought about it that way.
So there's still much more to go. I hope for some will say it's a bubble, but yeah.
79 and a half to beat last year. Yeah, high standards.
Yeah, high. Look, I mean, that's the thing with the tech industry. It has to grow otherwise, you know, it just capital outflows elsewhere. In today's episode, we're actually going to celebrate a very interesting acquisition in the biotech space rather in the AI and biotech space. It's a pioneering acquisition done by none other than one of the most amazing scientist, female tech leaders in the world, Dr. Daphne Koller. She's one of those people who was you know worthy of the title serial entrepreneur between Coursera and other initiatives at the bleeding edge of tech now is focused in the last 7 to 8 years on AI-driven drug discovery and Incitro, the company she founded and CEOs just made an acquisition in Combinable AI in Israel. We're going to spend some time with Daphne later today to discuss biotech, AI, the Israeli ecosystem, her own journey, and really I think that's going to be a privilege for us and for the listeners.
Absolutely. She is a very rare talent and I'm very excited personally to be able to meet her and speak to her today. But first, as usual, we're going to take a look at some of the week's pressing news, aka our big shorts, and of course, the latest update on the Windex, the What's Your Number Index that tracks the performance of publicly traded Israeli based or founded companies. Let's kick things off with this week's Windex. Yonatan, how is it looking?
It's in the red again, underperforming a sluggish NASDAQ and a slightly green S&P 500. It's been a volatile week with the introduction of the new chairman of the Fed. An important step that ends, you know, the president's discontent with the current Fed chair, Jerome Powell, which he appointed in his first term. We saw gold and silver lose double digit on Friday. Like, it was so funny because the Friday papers were celebrating gold and silver. And there was even an outcry here in Israel against the chairman of the central bank for having zero gold in the bank's reserves considering where gold went and beat S&P and other key indicators over the last 24 months. And there you have it in one day both gold and silver lose double digit. So the nominated chair Kevin Warsh, wonder kid, a protege of Stan Fischer who was appointed to the Fed board of governors in 2006. I think he was like 34 or 35 and he was a trusted figure by that time with Ben Bernanke kind of navigating the exit from the global financial crisis. So I think it was an important week. The markets responded accordingly. On the winner side for the Windex are leading the pack is Nova Measurements. One of my favorite companies really, you know, kind of quiet, yucky-ish company that's so critical for the supply chain of silicon wafers. Again, in historic heights up 7.97% on the week at $13.5 billion market cap. Such good news for the industry and showing again the strength of Israel's silicon posture. Also good news for big digital, one of our big digitals, Fiverr.com last week traded below its net cash position. So a bit of a negative sentiment over the last few months, up five and a half percent over an analyst buy recommendation. Curious to hear your thoughts on that.
Yeah. So days when gold and silver drop like that are very rare. But actually I want to pause on Nova's performance. As you say, this is a company that's sitting right at the core of the semiconductor value chain. And the stock's performance is definitely a signal, I think, that the picks and shovels still wins even in uncertain macro environments. In a way, it's become kind of like a proxy for global confidence in Israeli deep tech. We even consumed ourselves in the markets with consumer tech. But Israeli deep tech has been there kind of all along quietly. And on the consumer front, yeah, you're right. Fiverr, it's been rough and these are kind of sentiment cycles, I would say. Right. They're almost weekly. I don't know that an analyst buy sentiment is going to change the stock this week, but it's been brutal for Fiverr and I suspect it will continue to be.
Yeah. And I think the sentiment was that it was the state of affairs of the stock being traded below its cash position was kind of like okay it can't be that bad. Whatever you think about AI, you know, so in the red and this actually does continue the trend Monday.com another week where it bottoms the Windex same AI headwinds same challenges to the SAS space just you know how quickly the world changes when it comes to digital tech right SAS every wanted to everybody wanted to be SAS when we were on the road show in Wall Street it's like how is this recurring revenue and how is this SAS and does that compare to that and that multiple. Monday lost 10.63% just this past week, nearing its all-time low. That said, I did some digging and research in preparation for today. The company was already in this territory below 6 billion market cap just about 3 years ago, May 2023, and it rallied in an incredible period of growth to recover that position more than doubling until June 6, 2025, less than a year ago, was at its peak. So, you know, I think it's a roller coaster, but let's see where it goes.
I remember quite clear, I mean, it wasn't that too long ago, but I do remember quite clearly the market effectively writing it off. But only, as you say, to watch it execute its way back. I'm not saying it guarantees any kind of repeat of that. But I do think that this company knows how to operate under pressure. And so, we will continue to monitor. Another interesting dynamic when it comes to deep tech. The government's AI bureau headed by Erel Margalit is taking more and more steps. Last week we saw whether it was a leak or a press release, Globes, an Israeli leading economic newspaper leaked or published I should say the memorandum of understanding between Jacob Hellberg and the Palantir dynamics and the Israeli government around a very advanced AI park in the south of Israel not so far from the Gaza envelope actually that may actually include a nuclear facility led by the US because Israel cannot build nuclear facilities on its ground is not part of the non-proliferation treaty. Very interesting creative solution for how to build accelerated multiple gigawatt capacity in Israel to drive AI on ex-territory not so far from the Gaza border. The government declined to respond but it seems like this is something that went back and forth and has been signed as an MOU. Deep tech, American-Israeli alliance, American-Israeli-Emirati alliance, those are how we build the next generation of big tech and it's good to see again that we have cyber, we have digital and so on, but this type of technology isn't stopping.
Right? As I said, it's always been in the background. It just doesn't always get to the headlines, although in your case, it was definitely leaked to the Globes financial newspaper. Okay, big shorts. This one is big and very exciting. Last week, Apple confirmed it acquired the Israeli startup QAI for an estimated almost $2 billion. It appears to be the second largest acquisition in Apple history. That's Apple's history, not Israeli history. Apple's history. So, what is QAI? If you don't know or have never heard about it, I know you know Yonatan, but our listeners may not. And you're not alone because the company was still in stealth mode when it was acquired and therefore very tight-lipped in public about its tech. But the patents it filed showed the tech was being used in headphones or glasses using and I quote facial skin micro movements for nonverbal communication. It was supposedly to boost up Apple's wearable technologies. Now the founders of QAI, one of them is Aviad Mizrachi whose previous projects was also acquired by Apple in 2013. So he's a second timer coming in hot and he was in 2013 PrimeSense was core to developing Apple's facial recognition software. His co-founders with QAI are fellow Israeli entrepreneurs Yonatan Wexler and Avi Bar-Lev and they and their 100 employees are now going to join Apple.
Well, a couple of things here that I think are worthwhile. First, this is the power of the ecosystem, right? Apple with the second acquisition. It's not a company that acquires a lot. Second acquisition in Israel goes back to Aviad Mizrachi who they know and I think that's a highly indicative kind of unique value that you get in an ecosystem right tech is not about where you pour money and you just grow tech we've seen Qatar try to do it we've seen Saudi try to do it we've seen Turkey try to we've seen France and other bigger and more established countries like Italy and others try to do it is not that easy and the fact that Israel already has those recurring dynamics is a big deal. We saw it with Avdo Villains in the semiconductor businesses time and time again and I think this is important. The second piece number two at Apple for hardware is an Israeli, Johnny Srouji. He's been there for I think probably 15 years. I remember going to meet him. He granted me 15 minutes as a young Israeli entrepreneur in the Apple complex in Silicon Valley to hear the thoughts of how we're going to use Apple cameras to deliver kidney function measurements under FDA and then chronic wound management and basically told me where the stack is going you know as much as he could. These are the hallmarks of a mature very competitive tech ecosystem. I will say two quick things about Yoni and about Avi. Avi I don't know well enough but Avi was on the team of Beresheet for quite some time being the lead AI of the spacecraft that we had all hoped would land on the moon and he's sort of like a wonder kid also an incredible guy a true genius Yoni Wexler I tried to recruit as my CTO quite a number of times when at the time he was at OrCam working with Amnon Shashua I failed let's put it this way these are really people at the far far end of what they do and it doesn't surprise me that they were acquired in stealth mode. Let's put it this way.
I was reading through the blog post of Eden Shochat who is one of the seed investors in QAI and he was talking about how he missed investing in PrimeSense in Aviad's first startup. And then years later when Eden approached Aviad, it was the other way around this time. He had a reaction and I'm gonna quote and but he said no way. And he didn't want he said I'm not betting against this guy again. He was so sorry he hadn't funded PrimeSense. It's really buying the future. It's not buying a product as you said you know the people over at Apple and they know exactly where they're going and so kind of investing in these hundred people and in these founders is really kind of investing in the future of Apple, not buying a product off the shelf.
Let's move on to the second big short. This one is actually a bit different. Over the weekend we saw a person in Israel doesn't like us Israelis who don't appreciate this person that much. That is the chief of the UN, the secretary general, who said that the UN is approaching an imminent, I'm quoting, an imminent financial collapse, citing unpaid fees and a budget rule that forced the global body to return unspent money. Letter seen by Reuters on Friday showed that this is the case. This is not a typical big short as it doesn't relate directly to the Israeli economy. But for Israel, a kind of in limbo UN is not a good thing. It is a good thing politically because it allows us to maybe hopefully recreate the international legal framework for the Israeli-Palestinian conflict in ways that may usher in a new era, more constructive one for Gaza, for the West Bank because the UN was not a fair player when it comes to that. But if you zoom out, a weak player that's out there seeking a financial rescue is basically calling on nefarious actors to do that. Right? So the fact that the US pulled out its funding and we all know the Monroe Doctrine, the Donald Trump national security policy, it sort of was stated there, sovereignty before international bodies in a very honest way because truly those international bodies have failed. They failed in Congo. They failed in other places in Africa. They failed in Ukraine and Russia and so on. Clearly they need to be rebooted if you will. But if America pulls out and Qatar steps in or any other nefarious actor and if you will sort of buys their way as they have in other institutions into this UN body most of the people in the world when they hear the word according to a UN report they still think it's credible. That is a big risk for the Israeli economy. It is a big risk for the BDS dimensions against Israel. And so while I do not like the fact that the UN is where it is right now and I would definitely want Israel to leverage the sort of interim period, I would also not like to see this body fail, collapse and being rescued financially by nefarious actors. That would be bad for Israel in general. It would be bad for the Israeli economy.
I agree. I mean I caution around this story not to go too fast and I think you put it well to kind of separate two things. There's a very real financial and governance stress that the UN is under. But the other idea is really about international law and multilateral coordination more broadly. What happens when there is no UN or when there is a very weak UN and those aren't the same things. And so institutions can be strained or imperfect, but they still matter. And I think you know as we look at other trends in economic stories that we're following, there is a broader shift in how power, legitimacy and institutions are being redefined. And I think it very much holds for global institutions as well. We look at the post October 7th Israel. The question really isn't whether the UN is good or bad, but whether it remains credible, right? And as you said, most of the world does look at UN report and take it at face value. But unfortunately, a fragile UN doesn't eliminate international law, but it does distort how it's applied. And that's where us included, smaller countries and Israel, we're going to feel the effects first. So.
Yeah and you know it's a great point that you're making that it's a broader unraveling or changing. I think we are at a point where a French author in the 60s once called the end of the sewage of history. It's this kind of period where everything is in flux right just to give you an example before we recorded I read a big piece about how Xi Jinping overnight said you know the dollar is at now 57% reserve currency globally. It used to be 70%. Right? This decline is very clear and very apparent. China wants the renminbi to be a monetary power of record. They're now at 2% of global reserves. Now he's saying that but at the same time the monetary reforms that need to happen in China aren't happening. So it's very nice to declare that China wants to step up and for the yuan to be the currency of record when it comes to international monetary reserves. You can't do that if you don't open and allow trade in your currency because nobody's going to buy that currency and for you guys to five years down the line decide it's worth half or double, right? It doesn't work that way. So still America in my view for the foreseeable future and all the way through the end of the century considering the reforms that the Trump presidency is undergoing which I think are pivotal for American monetary supremacy like the strategic minerals act or the genius act or things we discussed on the pod about 6 months ago. But yeah the world is in flux. Israel needs to navigate very difficult waters to promise economic freedom as it is you know export-driven. All those companies we discussed in the Windex or others basically have no maneuverability if international law isn't applied at minimum and if the international institutions are shifting that quickly.
Today we are joined by Daphne Koller, an Israeli-American computer scientist and currently the CEO and founder of Incitro, a machine learning-driven drug discovery and development company. Just last month, Incitro announced the acquisition of Israeli startup Combinable.ai and the establishment of a new R&D center here in Israel. Daphne was a professor in the department of computer science at Stanford University and a MacArthur Foundation fellowship recipient. She's also one of the founders of Coursera. And if we go back even further, she completed her MA at just 18 at Hebrew University. Basically, she's one of those people whose career makes you stop and rethink what is possible. Daphne, great to have you.
Great to be here. Thank you for inviting me.
I want to start with an earlier stage in your career. You were part of building Coursera at a moment when online learning was still very much experimental. Online education was a great promise about a decade ago and there were even discussions that maybe the school system would end as we know it. How do you look back at that time and what did it teach you?
I think it's a great question and I think there was at the time the notion of a digital revolution in the air that was basically transforming entire sectors one after the other and a recognition that you either got on the train or the train was going to run you over and I think that you know the same thing happened to traditional media it happened in commerce it happened in video delivery, Netflix, and it does require I think a rethinking of how one approaches one's area and some incumbents were able in each of those areas to make the transition but many were not and the message that we were sending to universities is that it is important to kind of embrace and rethink one's development and not just pretend that it's not going to happen to you. I never thought this would end face-to-face education. That was never the intention of us at Coursera and never part of our messaging. In fact, what we thought it would do is transform how education was delivered and make it better. I would say that probably didn't happen as much as we thought it would. I was hoping that people would embrace for example active learning in the classroom and defer much of the sort of reading through of materials or understanding the basics to an online setting. I think that was too big of a cultural transformation for many institutions to embrace unfortunately. But we're starting to see more and more of that happening ironically today with the advent of AI and so I think some things take longer than you expect and I would echo I don't know to whom to attribute this quote. I've heard it attributed to Bill Gates, but I think it precedes him, which is that people always overestimate the effect of any new technology at the 2-year time frame and underestimate its effect on a 10-year time frame. And I would say that that is probably the single biggest lesson that I took to what we're doing today at Incitro, which is there were all these hyperbolic statements about how we're going to discover, you know, hundreds of drugs in three years. And the fundamentals of this industry just don't make that possible. Clinical trials take what they take. I mean you can accelerate them some but there is sort of a rate limiting factor which is human biology and you can't accelerate it beyond that. But I think the impact will at the 10-year time frame or maybe 15 given this is an industry that's intrinsically more slow-moving. I think that that impact will be far more transformative than people appreciate.
