Israeli networking solutions company DriveNets, founded by Ido Susan and Hillel Kobrinsky, is raising $410 million at a valuation of $8.5 billion, "Globes" has learned. The huge investment round makes DriveNets Israel’s second largest privately-held company in valuation terms, after VAST Data, which recently received a valuation of $30 billion.

DriveNets achieved the high valuation after demonstrating that it had entered the growing AI market, after mainly serving telecommunications companies in its first years. DriveNets turned the networking servers that it developed, designed for large communications switches at telecommunications giants, into a networking infrastructure for server farms for AI processing, performing a function similar to that which Mellanox performs within Nvidia.

DriveNets is believed to serve giant neo-cloud companies, a fairly new market of companies that specialize in building server farms for AI processing.

The investment round is being led by the company’s existing investors: Bessemer Venture Partners, under Israel partner Adam Fisher, and Atreides Ventures, which is represented on the company’s board by Gavin Baker, a serial investor in Israeli AI companies and one of the early investors in SpaceX.

The round has been joined by some surprising new investors, such as chip giant AMD, which has begun to collaborate with the Israeli startup, and Israeli fund Red Dot Capital Partners, alongside existing investors such as Pitango and D1 Capital.

In the past eighteen months, since entering the AI market, DriveNets has been profitable with positive cash flow, deals signed worth over $1 billion, and a future of growth. It is estimated that the networking market for AI server farms will reach $200 billion by 2030. Nvidia itself earns some $40 billion annually through the activity of the former Mellanox, which it acquired.

Published by Globes, Israel business news - en.globes.co.il - on June 1, 2026.

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