Dream, an Israeli cybersecurity startup founded by former NSO Group CEO, raises $260 million at $3 billion valuation

Founded by former NSO Group CEO Shalev Hulio and former Austrian Chancellor Sebastian Kurz, Dream develops AI-powered cyber defense systems that help governments protect critical infrastructure from state-backed cyber threats.

Dream, an Israeli cybersecurity startup founded by former NSO Group CEO Shalev Hulio, has raised $260 million in new funding at a $3 billion valuation, betting that governments will spend heavily to defend against the next generation of AI-powered cyber threats.

The investment comes as countries across Europe, the Middle East, and Asia increase spending on digital defense amid rising geopolitical tensions and growing concerns that AI could reshape cyber warfare. As governments prepare for a future in which AI systems can launch cyberattacks, investors are pouring money into startups that promise to defend against them.

The company was launched in 2023, just a year after Hulio cut ties with NSO Group, the controversial spyware firm that faced international scrutiny over allegations that its Pegasus software was used to target journalists, activists, and political figures. Meta accused NSO of targeting WhatsApp users, allegations that fueled years of legal and regulatory battles for the company.

Dream has taken a very different path.

From Spyware Controversy to AI-Powered Cyber Defense: Dream Raises $260M at $3B Valuation

Rather than building surveillance tools, the startup focuses on protecting governments and critical infrastructure from cyber threats. Its customers include public-sector organizations responsible for critical services such as water systems, oil and gas facilities, and national infrastructure networks.

On Wednesday, Dream unveiled Atlas, a sovereign AI platform built to help governments secure sensitive systems without relying on foreign-controlled technology.

The company says demand has been strong. Hulio told Reuters that Dream generated roughly $300 million in government sales last year across Europe, the Middle East, including Gulf countries, and Asia.

“We managed to prevent huge cyber attacks from China, Russia, Iran and North Korea,” he told Reuters.

Dream’s pitch arrives at a moment when governments are becoming increasingly concerned about the role AI could play in future cyber conflicts. Security experts have warned that AI can accelerate the discovery of software vulnerabilities, automate phishing campaigns, and generate malware at a scale that would be difficult for human operators alone to match.

Hulio believes the next stage of cyber warfare will pit AI systems against one another.

“Everybody understands that the next cyber war is actually going to be AI versus AI,” he said.

“We built an AI solution that knows how to prevent cyberattacks created by humans, but also cyberattacks created by AI.”

The startup employs about 350 people across offices in Tel Aviv, Abu Dhabi, and Vienna. Dream plans to use the new funding to expand deployment of its sovereign AI and cyber defense platforms across Europe, the Middle East, Asia, and the Americas.

Questions around sovereignty have become a major theme in government technology spending. Many countries are seeking greater control over critical digital infrastructure as geopolitical alliances shift and concerns about dependence on foreign technology providers grow.

Sebastian Kurz, the former Austrian chancellor and a co-founder of Dream, said those concerns are driving demand for national cyber defense platforms.

“Allies sometimes don’t know if they will be able to trust their allies forever, so there’s a big need for sovereignty and being more independent,” Kurz said.

The funding round was co-led by Bicycle Capital and Group 11, with participation from Antler, Bain Capital Ventures, Tru Arrow Partners, and several other investors.

Dream has not disclosed a timeline for a public offering, though Hulio made clear that an IPO remains part of the company’s long-term plans.

“Eventually, we will go public,” he said. “Our goal is to become a big company, a successful company, and a public company.”

Shalev Hulio and Sebastian Kutz credit: Pini Siluk and Dominic Butzmann