Texas is slowly becoming a magnet for global tech, and one of the biggest investors in the state seems to be Israeli companies. Senator Ted Cruz is a public figure who recently highlighted this trend on X. He wrote, “Israeli companies are betting big on Texas, investing $3.2 billion and creating more than 4,200 jobs across our state. Now that investment is expanding into AI, cyber, defense, water, and agriculture. Texas gets the jobs, the capital, and the technology. That’s a partnership worth growing.” To back his claims, Cruz included screenshots from an opinion piece by Winslow Swart for the Times of Israel. In his piece, Swart claimed that the Texas-Israel relationship has evolved over the last decade. He wrote that there is a structural shift where the two regions are formalizing state-to-state economic ties and building infrastructure to support these partnerships. Swart noted that trade between Texas and Israel hit roughly $4 billion in 2024. Of this, $3.2 billion was the imports from Israel into Texas, focusing heavily on industrial machinery, aircraft parts, and plastics. Developing a market Swart claimed that the momentum is visible in private and public sectors. He noted that Texas made a major move by doubling its holdings of Israel bonds to $280 million, the largest such purchase in the state’s history. Swart also claimed that there is also talk of connecting the Tel Aviv Stock Exchange with the new Texas Stock Exchange being built in Dallas. He noted that this kind of institutional plumbing is exactly what makes a relationship durable. According to Swart, it turns one-off deals into a long-term pipeline for founders and investors. Israeli companies are betting big on Texas, investing $3.2 billion and creating more than 4,200 jobs across our state.Now that investment is expanding into AI, cyber, defense, water, and agriculture. Texas gets the jobs, the capital, and the technology. That’s a partnership… pic.twitter.com/O3KbtJfEfb— Senator Ted Cruz (@SenTedCruz) August 20, 2026 A recent report by 5W, an AI communications firm, released through PR Newswire, provided more detail on this investment pattern. The report, titled Israeli Tech in Texas, noted that over 80 Israeli tech companies moved into Texas between 2020 and 2026. 5W, which specializes in AI visibility and PR, found that these firms employ more than 8,000 people across the state. Major names like Wiz, SentinelOne, Pagaya, and Salt Security are reportedly leading the charge. Ronn Torossian, the founder and chairman of 5W, remarked that while this movement was quiet for years, it is now impossible to ignore. He stated, “California’s loss is Texas’s gain. Israeli founders looking at the U.S. market are choosing Austin and Dallas at rates that did not exist five years ago. The capital is following. The talent is following.” The reasons for this migration are pretty clear when you look at the economics. According to the report, operating an engineering office in Austin or Dallas is significantly cheaper than in Silicon Valley, with savings ranging from 35% to 50%. Beyond the lower costs, Texas offers a deep talent pool in cybersecurity and defense, supported by institutions like the University of Texas system and Texas A&M. The state’s energy abundance is also a huge draw, especially for companies working on compute-intensive AI projects that need a reliable and independent power grid. In fact, one of Texas’ oil fields is rumored to be a major source of jet fuel for Israel. The Jerusalem Post also reported on this transformation, noting that Texas is rapidly becoming a centerpiece for American defense innovation. For Israeli founders looking for defense partnerships, Texas reportedly offers a unique advantage. The state is home to the Army Futures Command in Austin and various military bases that allow companies to test their technology in real-world scenarios. Interestingly, while these companies are setting up to get defense contracts, Netanyahu has announced a goal to reduce the country’s military dependence on America by $3.8 billion. Instead of selling into a vacuum, these startups can work directly with the people who are actually writing the requirements for new defense tech. This alignment is so strong that the Jerusalem Post organized an international conference in Dallas called Unicorn Rodeo, designed to bridge the gap between Israel’s innovation engine and the Texas scale-up ecosystem. Per the outlet, Israel brings advanced capabilities in AI, cyber, and autonomous systems. On the other hand, Texas provides the infrastructure, procurement pathways, and capital to help those technologies reach scale. So, invested partners and the governments are establishing offices on both sides of the world so that the state can position itself as a primary commercial gateway for the region.