Israel picks two deep-tech incubators for physical AI and human-machine interface startups

The Israel Innovation Authority has chosen two new incubators to build startups in physical AI and human-machine interface, with major backing from Elbit Systems, Ichilov Hospital, Bar-Ilan University and venture investors. The program is meant to create dozens of deep-tech companies over five years and push more Israeli science into commercial businesses.

Why it matters: - The Israel Innovation Authority is using a new incubator model to speed up company formation in deep-tech fields where capital is scarce and commercialization takes years. - The program targets physical AI and human-machine interface, two areas that could affect healthcare, robotics, industrial automation and other sectors. - The incubators are designed to help Israel turn more applied science into companies and strengthen its early-stage investment market.

What happened: - The Israel Innovation Authority selected two technology incubators: Augmenta Health Incubator and Intelligent Machine Labs – Foundry. - The incubators will establish and grow startups through a venture studio model. - The physical AI incubator will be coordinated with the AI Directorate’s initiatives at the Prime Minister’s Office. - The authority said the winning groups will begin operating the new incubators within about six months. - The selected groups include Elbit Systems, the Schestowitz Group, Ichilov Hospital and Bar-Ilan University, alongside investors including aMoon Ventures, Tene Capital, Opimpact, Siddhi Capital, SpringHill Venture Capital and Alpha Partners.

The details: - Startups supported by the incubators will receive joint investments from the incubators, other investors and the Israel Innovation Authority through its Startup Fund. - The startups will also get follow-on funding from dedicated investment funds tied to the incubators. - The incubators will provide business and technology support, access to experts across the value chain, introductions to strategic partners and investors in Israel and abroad, and access to laboratory infrastructure. - Augmenta Health Incubator will focus on human-machine interfaces for healthcare, neurotechnology, robotics, bioconvergence and dual-use technologies. - Augmenta Health Incubator is built around aMoon, Elbit Systems/Incubit, Ichilov, BIRAD and Opimpact. - Augmenta Health Incubator plans to operate an advanced HMI laboratory and provide access to research and clinical infrastructure. - Intelligent Machine Labs – Foundry will focus on physical AI for robotics and industrial automation. - Intelligent Machine Labs – Foundry includes Tene Capital, SpringHill Ventures, Schestowitz Ventures, MassChallenge, Siddhi Capital and Alpha Partners. - Intelligent Machine Labs – Foundry will support company formation through an EIR program, an advanced development laboratory, testing infrastructure and links to factories, industrial companies and global partners. - The winning groups will receive a five-year franchise. - Each group will receive a grant of up to NIS 40 million for management fees and central laboratory setup. - The model allows investment from pre-seed and seed through Series A, with government participation of up to NIS 23 million per company. - The incubators are expected to establish dozens of new deep-tech companies during the franchise period.

Between the lines: - Israel is leaning harder into venture creation, not just venture funding, to address the gap between research breakthroughs and investable companies. - The mix of hospitals, universities, industrial companies and venture funds suggests the government wants commercial execution and domain expertise built in from day one. - The focus on physical AI and human-machine interface reflects a bet on technologies that combine software, hardware, biology and manufacturing.

What's next: - The incubators are expected to launch operations in about six months. - The first companies should emerge through identified clinical and industrial needs, then move into development, pilots and follow-on fundraising. - The Israel Innovation Authority will keep participating in investment rounds as companies move toward global markets.

The bottom line: - Israel is backing two new deep-tech incubators to turn research, clinical insight and industrial demand into startups with a clearer path from lab to market.