At a time when investors from the US rarely visit Israel, Ezra Gardner (48) has made sure to come to the country roughly once a month since the beginning of the war. Gardner is a co-founder of venture capital firm Varana Capital, which in 2024 became the most active foreign fund in Israel, according to IVC data. He currently serves on the boards of ten Israeli companies, both privately-held and public. He also set up a SPAC, Gesher Acquisition Corp, which merged with Israeli firm Freightos, and a second SPAC, Gesher Acquisition Corp II, which raised approximately $150 million and is currently searching for another Israeli company with which to merge.
"They tried to sell us Israeli shares at a loss"
Gardner’s career took off at UBS, where he became the youngest desk head in the bank’s history; at age 28, he already managed a $30 billion long-short desk. Other milestones in his career include working for Michael Dell’s family office and J.P. Morgan, where he was an analyst. At 30, he immigrated to Israel and managed a local investment fund. Since 2012, he has been with Varana, which operates out of Denver and Tel Aviv.
Gardner’s close ties to the Israeli venture capital industry, together with his familiarity with the US investment market, led him in early 2024 to warn about a collapse in the volume of foreign investment in Israel. He even appeared before the Knesset Finance Committee to raise the alarm. In an interview with "Globes," he explains why-despite the current challenges-he will never stop investing in Israel.
What is the sentiment among foreign investors towards Israeli companies, both private and public?
"There’s a big difference. In the private market, things aren’t looking good, especially among European investors, who are not only holding back from new investments, but are even pulling out of existing ones. One European institution that invests alongside our fund asked me to buy their holding at a discount. That’s not good for them, as they’d be taking a loss-but it’s not good for me either, because buying them out won’t help our portfolio companies.
"By contrast, Israeli companies listed on Wall Street are ‘protected,’ because they’re not necessarily perceived as Israeli. I’ve told senior figures in Israel’s high-tech sector: this is our ‘superpower’: we need to be in the public market. Once a company is public, its reports come out like everyone else’s, without flashing lights saying ‘Israel, Israel.’"
"Shaquille O’Neal doesn’t need to launch a SPAC"
In 2020-2021, one of the most popular routes to enter the capital market was through a SPAC-a shell company that raises money on the stock exchange with the aim of finding a privately-held company with which to merge. Gardner led Gesher Acquisition Corp, which merged with Israeli tech company Freightos. This year, he raised about $150 million for Gesher Acquisition Corp II and is seeking another Israeli company for a merger. "We’re looking for a wonderful team of geniuses who’ve built something unique and need more access to capital than the local private market can provide," he says. Gesher focuses on sectors such as quantum computing, high-performance computing (HPC), and AI.
The previous SPAC hype led to disappointment. What has the market learned since?
"That you don’t need to let Shaquille O’Neal launch a SPAC," Gardner jokes, referring to the basketball star who was among the celebrities to enter the SPAC market (his second SPAC eventually canceled its merger). Having worked in the field for two decades, Gardner says that the performance of companies that were merged into SPACs has been fairly similar to that of companies that went public through IPOs during the boom years.
Today, he says, there are around 60 active SPACs-about 10% of the number at the market’s peak. Meanwhile, the IPO market has come around after two difficult years, with a backlog of some 400 potential listings over which the banks are competing. "If a company is worth less than $5 billion, the big banks chasing mega-deals won’t look at it, so SPACs can be a good alternative," he explains.
Still, Gardner himself hasn’t only seen successes. Freightos, for example, merged at a valuation of $500 million, but is now traded at just $166 million-a two-thirds drop in value. "Nobody likes seeing stocks fall," he says, "but we’re still very proud of that deal, and we have no doubt that Freightos will thrive. It continues to grow its business every quarter and expects to become profitable next year."
"The market is closed to Israeli companies"
Recent data from the Israel Innovation Authority, IVC, Gornitzky & Co., and KPMG, show that Israeli venture capital funds are struggling to raise money: after an 80% drop in fundraising between 2022 and 2024, 2025 hit a new low. Since these VC funds finance early-stage startups, the result is a shortage of capital. "There are plenty of headlines about big cyber and AI deals-which is great-but those are large companies," Gardner says. "We warned that the ones that will struggle are those startups seeking foreign capital for the first time. The market is closed to Israeli firms." According to him, there is no need to reinvent the wheel, but rather to take measures that have worked in past crises, such as during the Covid-19 pandemic. For example, the government should encourage venture debt loans from the banks.
You met with Knesset members and ministers. Did they listen?
"I think so. You have to understand: governments react quickly to acute crises like the 2008 global crash or the pandemic. But when it’s a slow-moving crisis-as I’ve called this one-it’s harder to respond, but you have to try."
Gardner adds that the hit to VC funds in 2024 wasn’t as severe because they still had "dry powder"-capital that had already been raised and was available for investment. But that capital is running out. "Global investors have other opportunities-it’s not as though they’ll lose money by not investing in an Israeli fund," he says.
How does Israel’s high-tech ecosystem look after two years of war?
"Surprisingly resilient-which is amazing. But it’s not what it used to be. Israel’s ability to absorb risk is the best in the world, but still, you can see the difference. Restaurants in Tel Aviv that once hosted business meetings with foreign investors are closing; and at Ben-Gurion Airport-how many people are standing in the foreign passports line? Almost none. And it’s been like that for two years."
The prime minister spoke of an autarkic economy.
"It reminds me of the 1970s oil embargo on the US because of its support for Israel, when the president went on air and said, ‘Put on a sweater and turn off the heating.’ Is that where we want to end up?"
After the outbreak of the war, Varana launched a multimillion-dollar emergency fund called Chai 10X , aimed at investing in Israeli high-tech firms. So far, it has invested in about 13 companies and expects to reach 15-20. "We may be the only ones in Israel with available capital, and we’re getting lots of calls," Gardner says, adding that the fund is expected to show high rates of return.
In conclusion, Gardner stresses that despite the challenges, "I’ve never been more optimistic" about Israel. "Seeing the resilience of the people, of companies operating while their employees serve on reserve duty for so long-it’s incredible," he says. "True, the hard times aren’t over yet, but we will never leave Israel."
Published by Globes, Israel business news - en.globes.co.il - on October 9, 2025.
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