Merlin Ventures Raises $75M for Cybersecurity Fund Backed by Industry Veterans

Merlin Ventures, a Tel Aviv-based investor, has raised an over-$75 million venture-capital fund targeting early-stage cybersecurity startups in Israel. The fund is backed by industry veterans, including founders of Talon and Dig Security, two companies acquired by Palo Alto Networks in 2023. The fund aims to support the growth of Israel's thriving cybersecurity market.

Merlin Ventures, a Tel Aviv-based investor in early-stage startups, has announced the launch of an over-$75 million venture-capital fund targeting nascent cybersecurity ventures in Israel's thriving cybersecurity market. The fund, which aims to support the growth of the country's cybersecurity sector, is backed by a half-dozen industry veterans, including the founders of Talon cybersecurity and Dig Security, two companies acquired by security giant Palo Alto Networks in 2023 [1].

The new fund comes at a time when the demand for advanced cybersecurity solutions is surging, driven by the increasing frequency and sophistication of cyber threats. Israel, known as the "Start-up Nation," is at the forefront of this innovation, with numerous companies developing cutting-edge cybersecurity technologies.

The Series C funding round for Zero Networks, a cybersecurity startup headquartered in Tel Aviv, is a prime example of this trend. Zero Networks has raised $55 million in Series C funding, led by Highland Europe with participation from F2 Venture Capital, PICO Partners, Venrock, and USVP. This investment brings the company's total funding to over $100 million and highlights the growing interest in proactive defense mechanisms that can block attackers even after an initial breach [2].

Zero Networks, founded in 2019, specializes in simplifying the complex process of microsegmentation, a strategy that blocks lateral movement by isolating devices and services. The company's technology positions itself at the intersection of two related trends: the move toward identity-centric access control and the rising enterprise fear of ransomware and supply chain breaches that spread internally through unsegmented networks.

The Series C raise for Zero Networks comes amid a surge in demand for zero trust architectures, security frameworks that limit access based on user identity and device verification, rather than assumed trust based on network location. This funding round reflects the growing interest in proactive defenses that can block attackers even after an initial breach, an increasingly urgent priority for large enterprises.

The investment in Merlin Ventures and the Series C funding for Zero Networks underscore the robust growth and innovation in Israel's cybersecurity market. As cyber threats continue to evolve, these investments are poised to drive further advancements in cybersecurity technologies and solutions.

References:
[1] https://www.wsj.com/articles/cybersecurity-investor-merlin-ventures-raises-over-75-million-debut-fund-60126b61
[2] https://www.calcalistech.com/ctechnews/article/bkbtqi2geg