Less than 24 hours after the announcement of ServiceNow’s acquisition of Armis in a mega-deal crossing the $8 billion threshold (including employee retention packages), Insight Partners managing director Teddie Wardi prefers to speak less about the numbers and more about the journey.
In a LinkedIn post, he wrote that this is a "tremendous milestone" for founders Yevgeny Dibrov and Nadir Izrael and the entire team, describing how the partnership between Insight and Armis began with a small Series C check in 2019 and rapidly deepened until the acquisition of a controlling stake at a valuation of over $1 billion. This post is not just a sentimental gesture; it reflects how Insight perceives the deal: not as a one-time exit, but as the closing of a circle in a long-term investment move: from that initial introduction, through deepening involvement, to the strategic liquidation with a global software giant.
Insight, which acquired control of Armis in 2020, is expected to be the biggest winner from the exit, with returns in the billions. But for Wardi, this is primarily a moment that sharpens a broader thesis on success, growth, and the failure points of Israeli high-tech.
In an interview with "Globes," he attempts to explain what differentiates a startup that succeeds in building an exceptional product from one that succeeds in becoming a global organization that lasts. "The dangerous moment doesn't come when you need to develop technology," he says. "It comes much later, when you need to relinquish control, build a management team, and let the company grow beyond its founders."
Not magic, but a product solving a "painful" market
For Insight, the Armis deal is not just a random erxit in a hot market. The fund, which manages about $90 billion, specializes in large-scale software investments and supporting companies until maturity and IPO stages. Armis is a perfect case study for this thesis: a company that began as a startup focused on Operational Technology (OT) security and expanded into a comprehensive platform for managing cybersecurity exposure in complex organizations, from IT to medical devices. "Since the initial investment in 2019, Armis has grown from a startup to a global leader in cybersecurity exposure management," Wardi says. "The growth is a testament to the execution capability of the team and the entrepreneurs."
Armis is not the first exit where you are among the investors. Wiz, which was acquired this year by Google and represents the largest exit in Israel's history, is also in your portfolio. How did you meet?
When asked about Wiz, Wardi smiles. "In hindsight, everyone says it was obvious, but no one knows in advance how the story will end. What can be identified early are outliers." The first outlier, according to him, was the rate of market penetration and reaching giant customers in early stages. The second was the Time to Value - the ability to show immediate value. "In the corporate cybersecurity world, people got used to long implementation months," he explains. "Here we saw a product that shortens it to minutes. This changes the entire dynamic in sales and adoption."
Furthermore, he states the clear indication came from the numbers: within about 18 months, the company showed performance that looked like forecasts for the fourth or fifth year. "It's not magic," Wardi emphasizes. "It's a product that solves a problem for a market that is 'hurting' enough, and a team that knows how to sell."
"Buying wine from France and cybersecurity from Israel" - and that’s also the problem
Israel, according to Wardi, has a distinct brand advantage. "I once heard a Chief Information Security Officer say that you buy wine from France and cybersecurity from Israel," he says. But the advantage has also become a trap. "There is a massive density here: many niche ideas, a lot of duplication, and less appetite for truly big ideas." The criticism sharpens in the era of AI. While the local discourse tends to focus on the question of who will build a giant foundation model, Wardi presents a different position: significant innovation has moved to the application layer. "That’s where you can reinvent software, attack slow players, and build real value for users."
In the US, Wardi notes, many founders come from within the industries in which they operate - law, health, or finance - and identify inefficiencies from the inside. In Israel, on the other hand, the engineering talent certainly exists, but "the gap is in imagination and the appetite to choose problems outside the comfort zone." Cybersecurity, he says, "sucks out the oxygen - the capital, the hype, and the self-image of the ecosystem."
And why, in fact, don't we see more cyber companies reaching an IPO?
In response to this question, Wardi first offers a statistical framing: an IPO is the "final edge of the funnel." According to him, many companies fall along the way, and others are acquired at an early stage in a market saturated with acquisitions. He mentions that the history of Israeli high-tech was characterized by "Tuck-in" deals - a quick sale valued at a few hundred million dollars shortly after the initial funding rounds. According to Wardi, although the current generation of founders aims higher than in the past - toward building public platform companies - the main barrier remains at the international growth stage.
When asked to mark the weak point of Israeli tech, Wardi points again to the transition stage from a product that works for a company that knows how to grow. "This is the moment when you need to move from the design partners and pilots stage to a real Go-to-market setup," he explains. For years, the model was fixed: development stays in Israel, and one of the founders moves to the US to establish the sales operation. According to him, the question is not the physical move but what happens the day after: "Do they hire senior management and truly let them manage?"
Here, he says, cultural friction is created. Even after this path has been outlined countless times, Israeli entrepreneurs still find it difficult to relinquish control. "It works at the early stage," he says, "but at the growth stage, it becomes a limitation."
In this sense, the Armis exit illustrates his thesis: not just a strong product, but the building of a global organization and the expansion of a platform. "There is no lack of capital or technological talent here," Wardi concludes. "The real challenge begins long after the first code. That’s where it’s determined whether the success will be localized or massive."
Published by Globes, Israel business news - en.globes.co.il - on December 30, 2025.
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