Deep33, a new venture capital fund founded earlier this year by Israeli VC investor Lior Proschor and American entrepreneur Michael Bruchim, has closed its first fund at $200 million, above its original $150 million target. More than half the investors are foreign, mostly from the United States and some from Britain, alongside Israeli institutional investors.
The managers said the fundraising is notable because, about six months ago, many Israeli institutions still viewed deep-tech and hardware as relatively complex and risky. They now see a clearer opportunity in the sector. Deep33 operates from the United States and invests in AI infrastructure, energy, quantum computing, communications components and advanced physical technologies.
The fund says about 70% of its investments will go to companies founded by Israeli entrepreneurs, and about 30% to U.S. companies. So far, it has invested in Particle, QuamCore, Cyberidge and OHR, plus several undisclosed companies. Bruchim said the next wave of innovation will go beyond software, adding, “Many of the most important companies of the next decade will build the physical world of artificial intelligence.” He said the world will need much more energy, computing and infrastructure to remove physical bottlenecks.
A central thesis of Deep33 is that Israel can become a strategic deep-tech power similar to Taiwan’s role in semiconductors. Proschor said, “We believe Israel can be a supplier of critical technologies to the world,” including AI infrastructure, quantum computing and advanced industrial technologies. Beyond capital, the fund is building a network called Deep to Market to connect founders with major tech companies, potential customers and U.S. government officials. The managers say this could help Israel move from its traditional strengths in software and cyber to a larger role in the AI supply chain.
