In Tel Aviv’s bustling Azrieli Center, where tech offices hum with ambition, healthtech founder Elena Schwartz toasts her team, her startup’s $15 million Series A round sealed. Israel’s healthtech and AI sector, dubbed “Startup Nation’s” heartbeat, secured $500 million in funding this quarter, per IVC Research, with ventures like Schwartz’s AI diagnostics platform leading the charge. Despite global unrest, investors are betting on Israel’s innovation to transform healthcare. “We’re saving lives,” said Schwartz, her laptop glowing with patient data.

The funding surge, up 20% from 2024, fuels 200 healthtech startups, including Pixellot and XTrodes, known for sports analytics but pivoting to health monitoring. Schwartz’s platform, using AI to detect early cancer, drew backing from Sequoia Capital, citing its 95% accuracy in trials. Other stars include Medtronic-backed wearables and TytoCare’s telemedicine kits, serving 50,000 patients monthly, per company reports. “Israel’s tech is world-class,” said investor Aisha Cohen, whose fund backed 10 firms.

But hurdles persist. Oil prices, up 12% to $90 a barrel due to Israel-Iran clashes killing 639 in Iran, per human rights groups, raise shipping costs for medical devices. China’s rare earth curbs, tied to U.S. tariffs, hit chip supplies, delaying production, per Reuters. “We’re rationing components,” said Schwartz. Tel Aviv University and Technion alumni, driving 30% of startups, face hiring freezes amid Gaza war tensions, with some founders relocating R&D to Europe.web:10,22

The sector’s resilience inspires. “We innovate under pressure,” said Cohen. Israel’s 9,000 tech firms employ 320,000, with healthtech adding 5,000 jobs yearly, per Start-Up Nation Central. Events like Tel Aviv’s HealthIL Week, starting June 28, draw 2,000 investors. “Funding’s a vote of confidence,” said Schwartz, whose firm plans to expand to the U.S. Mayor Ron Huldai’s tech grants support 50 startups, though budgets are strained.

What’s next? Consultation could stabilize supply chains, increasing growth. Israel targets for $1 billion in healthtech funding by 2026. Can these ventures scale globally? For now, as Schwartz codes and Cohen scouts talent, Israel’s healthtech pulse races, healing the world one AI at a time.