Twenty-four startups now work with Sderot’s clinics, schools, and welfare services.By Brett Goodman, TPSThree years after Hamas terrorists stormed communities along the Gaza border, startups in those same towns and kibbutzim are cooling AI chips, developing devices to remove stroke-causing blood clots and treating trauma in virtual reality.During a press tour Tuesday, investors and officials in southern Israel described an innovation economy that continued to develop through the war, despite the evacuation of communities, the disruption of businesses and the loss of employees and investors.“Where most see crisis, we see the world’s most advanced living lab for resilience,” Eran Segel, co-founder of the Sderot Health and Resilience Innovation Hub, known as RISE, told The Press Service of Israel.The Western Negev Innovation Authority, known by its Hebrew acronym as Hamitbah and led by CEO David Gabay, works with about 150 startups.Its anchor is SouthUp, a nonprofit incubator founded at Kibbutz Nir Am in 2017. In 2014, the region had zero high-tech companies, according to SouthUp.Most Israeli incubators take at least 15% equity in the startups they support. SouthUp takes none and instead connects founders with state grants, laboratories, mentors and investors.Its venture partner is named for Ofir Libstein, the head of the Sha’ar HaNegev Regional Council who championed the project and was murdered by Hamas terrorists on October 7.SouthUp CEO Gil Shwarzman, who lives on Kibbutz Gevim near Sderot, said the incubator had 24 startups on October 7.After the region was evacuated, the incubator scrambled to find workspace for them. Employees left for reserve duty and some investors backed out. Most companies returned. Some shut down.Ami Appelbaum, chairman of Ofir SouthUp Ventures and former chairman of the Israel Innovation Authority, put the portfolio’s survival rate at 85%. SouthUp aims for 60 active startups and 600 jobs for Western Negev residents by 2029.ZutaCore, one of the ecosystem’s larger technology companies, makes a waterless cooling system that sits directly on AI processors.About 100 of its roughly 140 employees work in Israel, at its research and development center in Sha’ar HaNegev.In June, it raised $100 million in a Series C round from Mitsubishi Electric, Samsung Ventures and Carrier Ventures. Appelbaum put its valuation at $500 million.ZutaCore had about 40 employees on October 7, said Shahar Belkin of Kibbutz Nahal Oz. Within a week, staff were working from evacuation housing.Ten days after the massacre, the company presented at a conference in San Jose to show partners it was still operating. It now plans about 50 hires, 40 of them in Israel.Inretio Medical Device is developing PREVA, a net guided through an artery to the brain that encloses a stroke-causing clot and removes it without allowing fragments to break off downstream.Founder and CEO Raviv Vine left the semiconductor industry to start the company seven years ago, after his best friend’s father died of a stroke.The company reports first-pass clot removal in five of six procedures in an early human study at Sheba and Hadassah medical centers.Vine chose the Western Negev over Tel Aviv, Israel’s main technology hub.After October 7, SouthUp found the evacuated company space in central Israel, allowing it to continue manufacturing for six months before returning south.Omer Maroodi grew up on Kibbutz Re’im, five kilometers from Gaza.On October 7, he fled with his wife and baby daughter minutes before terrorists entered the kibbutz, then heard them over the baby monitor searching the family’s home.In May, he and high school friend Adam Goldbraikh, a former Elbit Systems sensor fusion team lead, founded Nova Dimension near the Gaza border.The company builds on-board artificial intelligence systems that allow drones and robots to operate autonomously.Resilience Through InnovationThe technology sector is only one part of the region’s recovery. In Sderot, companies and community organizations are also developing tools focused directly on trauma, mental health and resilience.Sderot has faced repeated rocket attacks from Gaza since 2001. RISE opened its building there in 2024, during the war. Segel said 310 ventures have joined its community and 68 have completed its programs.Twenty-four startups now work with the city’s clinics, schools and welfare services, and nearly all 18 core portfolio companies run pilots there.“We don’t want to bounce back to October 6th, 2023. We want to move forward and build,” Segel told TPS-IL.Eliav Ser, a reserve major with more than 450 days of combat since October 7, founded WalkImpact, an artificial intelligence platform for soldiers’ families.Ser said one in five reservists comes home with trauma symptoms and one in ten with post-traumatic stress disorder (PTSD). Hundreds of families have joined.“Coming home does not always mean the war is over,” Ser told TPS-IL.Eti Neaman, whose two children served as combat soldiers, runs Neao Reality, which delivers remote group therapy in virtual reality.It has treated more than 150 patients and works with hospitals and the Defense Ministry.Tsela Ben Zaken, 16, of Be’eri High School, is building an emergency-preparedness platform for municipalities with two other participants in the MEITAL youth innovation program.In Ofakim, 22 kilometers from Gaza, 18 terrorists entered the city on October 7 and 48 residents were murdered, Mayor Itzik Danino said.While the city waited for the army, 58 civilians went out to defend it. Ten were murdered. More than 5,000 residents now live with trauma disorders.The city has grown from about 24,000 residents seven years ago to 55,000, and the municipality expects 80,000 within three years.Under a 2018 plan to make Ofakim Israel’s agricultural technology capital, the SEED Innovation Center now hosts more than 20 startups and agricultural technology research laboratories.Shahaf Maroodi, CEO of AgroNegev, grew up on a kibbutz four kilometers from Gaza.“We won’t be the victims of our story,” he told TPS-IL.The cluster, which connects agricultural technology companies with Western Negev farms, recently partnered with Oracle after the company approached it.“If we don’t rebuild better, we lose twice,” Maroodi insisted.The post Three years after October 7, southern Israel’s startup ecosystem keeps growing appeared first on World Israel News.