When Dell Technologies Capital (DTC), the investment arm of Michael Dell, joined the first investment round of storage startup VAST Data in 2016, it saw it as a sort of calculated gamble. The fund invested just a few hundred thousand dollars for a small stake in the Israeli company, without making much of a commitment to it. Alongside DTC, Yoram Snir, managing partner of 83North, and Dror Nahumi of Norwest Venture Partners also invested in the company.
"I worked with Renen Hallak (co-founder and CEO of VAST Data, A.G.) and started to become better acquainted with him. At a certain stage I felt that the company, which at the time was without revenue and with many promises, was doing something interesting," DTC managing director Yair Snir relates, talking to "Globes". "But no-one imagined - not the investors and not anyone in the company - that the day would come when it would be worth $30 billion. A valuation in the tens of billions was territory reserved for companies like Microsoft and Google, not for a privately-held company, and certainly not for an Israeli one."
Relations between Snir and the firm he represents and Hallak and his team grew closer, until DTC decided to lead VAST Data’s second round in 2017. According to PitchBook, that round was at a company valuation of just $100 million.
Last week, VAST Data announced that it had raised $1 billion at a valuation of $30 billion. This is the largest investment round ever for a privately-held Israeli company, and it took place at the highest valuation ever recorded in the local industry.
For the sake of comparison, in the year before it was sold to Google parent company Alphabet, Wiz raised $950 million at a valuation of $12 billion in what was considered at the time to be a huge round. VAST Data’s annual revenue has already surpassed $500 million. The company’s meteoric growth rests on, among other things, its close relationship with chips giant Nvidia, which promotes the Israeli company’s solution among its customers. VAST Data’s system forms the infrastructure for storage and processing of data, and is critical for training and operating AI language models.
In 2017, the picture was very different. At that time, VAST Data was seen as another in the wave of Israeli storage companies that had peaked after exits of XIV, Storwize, and XtremIO, which was sold to EMC for $450 million and was where Renen Hallak served as VP development. "At the beginning of 2017, VAST Data was a storage company with no revenue that also had hardware activity which was beginning to lose momentum with the comprehensive switch to the cloud," Snir recalls.
"Although the sector was not at its peak, suddenly an entrepreneur came along who made you fall in love with an area that supposedly ought not to interest you. Renen is not one of those who waves his arms about. He looks you in the eye, listens, and expresses himself with rare technological depth. He lives the system, from the technical details to the customer experience to the way in which the technology will make a breakthrough."
VAST Data is now ten years old - an eternity in startup terms -but its great leap forward came after the AI "big bang" in 2022. Seven years earlier, the company did not anticipate the AI explosion - no-one did - but Hallak knew that there would be huge demand for computing power. "Even then he believed that a time would come when demand for computing would be so great that it would be necessary to build a storage system on a new scale," Snir explains. The vision was to facilitate data usage in high volumes and at high speeds at low cost, and betting on this they set forth.
No baggage
VAST Data’s break into the market, however, was neither quick nor a foregone conclusion. "The company had a logical and smart idea, but to turn that into a product that giant companies would adopt was a huge challenge," Snir relates. "At that time, companies such as OpenAI and Anthropic didn’t exist, and Nvidia wasn’t the monster we know today. The first customers were enterprises that processed data on a scale that was exceptional even then, such as hedge funds and life sciences companies that worked with immense volumes of genetic data. VAST Data’s promise of providing high processing speeds at a significantly lower price than those of its competitors was the entry ticket that enabled them to make the breakthrough."
The Covid pandemic period, and immediately after that the AI revolution, boosted VAST Data to new heights. "During the pandemic, companies tried to lay their hands on as many storage systems as possible, fearing a future shortage in the supply chain," Snir explains. "Although VAST Data is a software company and doesn’t sell storage components, it benefitted from this trend. In the following years, with the advent of artificial intelligence, the market realized that solutions built for the cloud era couldn’t meet the gigantic needs of AI computing and processing. There was no choice but to resort to VAST Data.
"Today," he continues, "it’s clear that there’s no AI without huge processing and computing power, and that you can’t have that without Nvidia and without an architecture such as that developed by VAST Data. After the cloud giants, Vast DATA has become the most important technological platform for Nvidia, and that happened in part thanks to fact that it did not drag around on its back any baggage of past customers and outdated technologies that it had to maintain and service. Instead, the company ran forward with software that it developed from scratch and that was designed from the outset to deal with fantastic quantities of data and with the complicated requirements of language model training, inference, and AI agents."
VAST Data does not develop its own language models, but rather serves as the critical infrastructure layer on which language models and smart agents run. It is responsible for storage, extraction and management of data from various sources, but unlike its traditional competitors it specializes in processing unstructured data, such as texts, pictures, video and sound, and extracting insights from them in real time. The ability to concentrate all these activities under one roof enables AI agents to communicate with one another and with the company’s algorithms in the best possible way, yielding more accurate, context-based information. Among the company’s giant customers are CoreWeave, the Lowe’s chain, and the US Air Force.
"Zero bravado and arrogance"
VAST Data grew under the radar, and was hardly known to the Israeli public. Hallak avoided interviews and appearances at conferences in Israel, and the company, which did without a local PR firm, focused its marketing efforts on giant US companies, its potential customers. The modesty extended to real estate as well: while its competitors were renting luxury offices in towers in Sarona or in Herzliya, VAST Data made do with a workspace in the Tel Aviv Expo Convention Center, and in the US it used WeWork rooms.
In line with that, the company was not swept along by the employee hiring wave of 2021 or the "growth at any price" syndrome. "It was one of the few companies that took care to maintain the balance between revenue and expenditure," says Snir. "It has been profitable for years, but all that with zero bravado and zero arrogance. It’s a demanding workplace where people work hard from the CEO all the way down, but the work bears fruit."
As revealed by "Globes", most of the current round consisted of sales of shares by employees and investors to new investors. Only a small number of shares was issued. According to estimates published by "Globes" in February, for every new share issued in the initial raise, 5-6 shares of previous investors, employees, and holders of matured options were sold.
For the longstanding investors - firms such as 83North, Norwest, DTC, and Greenfield Partners - and for the 1,200 employees, the round represents a significant exit after ten years of activity. "The event was made possible by the fact that the company is profitable and is not really in need of raising capital. It’s not a case of distributing dividends or of capital for renting luxury offices, but of rewarding those who carried the burden of bringing the company to where it is today."
Published by Globes, Israel business news - en.globes.co.il - on April 26, 2026.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.