Elron Ventures Ltd (ELRNF) Earnings Call Transcript & Summary

Good morning, everyone, and thank you for joining the Elron Ventures Investor Webinar. I am Lisya Bahar Manoah, Chairperson of Elron Ventures. And together with our CEO, Yaniv Shnieder, we will present Elron's outcomes 2025 and our thoughts for 2026. We will then spotlight 2 of our portfolio companies that reflect the strength and focus of our strategy, Addionics and OpenLegacy. Joining us are Moshiel Biton, CEO of Addionics; and Ron Rabinowitz, CEO of OpenLegacy, who will share their technology, market positioning, and what lies ahead. Let's begin. Let's take a look at a snapshot of Elron Ventures corporate overview. We are proud to have 25 portfolio companies across different stages, reflecting a diversified portfolio strategy. As of today, we are investing in Deep Tech, Defense Tech, cyber, software, and AI. During the last 1.5 years, proudly to say we have strengthened our long-standing partnership with Rafael. We are aware, and we are very, very carefully selecting our portfolios in the future and as of today in Deep Tech and the defense sectors. So let's look at what happened in 2025. 2025 is a year of building, exits, and growth. This webinar we have done 1 year and 3 months ago. It was very important for me personally when we have built this strategy, we should have been able to execute the strategy that we have promised to you and to all our shareholders. And here we are. Today, we have distributed $15 million dividend distribution on top what we have done at the end of the 2024 additional $15 million. We have completed this year 3 exits, which is linked to the dividend distribution policy, which is valued over $600 million and $40 million exit proceeds. It is important any single new investments that have a clear exit pathway that have a clear growth strategy. And with this strategy, we have invested in 2 new portfolio companies, which actually you will hear one of them today, Addionics. The second one is at the CyberRidge, and I hope you have heard many times the portfolio company CyberRidge in the conferences that we have held from the CEO, Professor Dan Sadot. It was important for us to bring the portfolio companies upwards, which means to bring them to states. So we have said to ourselves, we are a bridge between the shareholders, between the VC industry, and between the high-tech portfolio companies. Each and every single portfolio that we have done follow-on investments, we have done investments with together foreign investors. We took them to the states. We have hired new chairperson, Board of Directors to support the companies. And what -- as a result, the companies are moving forward, scaling up, and one step closer to the exit pathway. The partnership of the 2 investment vehicles, it is important for us. One is that our Deep Tech and defense partner is that Rafael. We keep investing with them, and we strengthen our relationship with Rafael together because we are aware there is a trend. And behind the trend, we really believe on it. We invest a lot of time, and we believe investing in the portfolios. Another vehicle is that the CyberFuture. CyberFuture is today supported by 18 global CISOs from global companies, who can invest with us, who are supporting and advising all the cyber companies that we are investing together. So the ecosystem is important, and Elron Ventures is back to the ecosystem. Yes, you might see myself and Yaniv in many conferences. The output is it is very important when we invest on the roundtables, we sit together with our friends from the VC industry. We invest -- we make that the bridge to the shareholders, to you to explain the details where we are investing, where is the growth and how the companies are scaling up. And that was the results of the 2025. So looking forward, what is expecting us in 2026? We will continue with our strategy. We will keep investing in the new portfolios in the 4 sectors that we are believing on it. And yes, it is important for us, and we believe that we estimate in the next 12 months, we shall execute 1 to 3 exit transactions in our portfolio companies, including other vehicles like RBC's portfolio. These exit transactions may be done through primary or secondary transactions. So within this day, I thank you very much, and I leave at the stage to the CEO of Elron Ventures, Yaniv Shnieder.

Thank you, Lisya. Hi, everyone. I wanted to share with you that today, I'm celebrating 1 year as the CEO of Elron after 25 years at Rafael. I'm excited and grateful to mark this milestone, especially together with you.

Many more years, Yaniv.

Thank you. Behind every success story stands a strong team. As a management team, we bring complementary capabilities, investment and M&A expertise, technological leadership, and public market financial experience. Alongside us stands a winning team that like a pieces of the puzzle, complements and strengthens our leadership. Since I joined Elron as CEO, one of my key objectives has been to strengthen the partnership between Rafael and Elron. And indeed, we have done so. We have built a joint Board composed of members from both Rafael and Elron, strong individuals who actively work together with our portfolio companies. We have a CTO from Rafael, who supports all of our technological due diligence processes and also helps connect us with the relevant stakeholders within Rafael, enabling the development of effective go-to-market strategies for our companies. You can see some of our partners from Rafael in the photo, and additional will follow on soon. We are proud of our portfolio companies and of the balanced composition of our portfolio across different stages of growth. This year, we have advanced our companies along their maturity curve, positioning them towards follow-on financing rounds or potential exits. We focus across the categories of Deep Tech, Defense Tech, cyber, and AI alongside health care companies. Already last year, we anticipated the transformative impact that AI would have on the software industry. Therefore, when we launched our new strategy, we chose to focus especially on companies with a true secret sauce, whether in the realm of Deep Tech and defense or in software companies where AI is an integral and meaningful part of the solution. Let's take a deeper look at the technological domains. We strongly believe in the cybersecurity sector, which continues to evolve alongside global technologies advancements. It is a field that has grown significantly over the past year, and we believe it will continue to expand, driven by technological progress in the AI and quantum eras. This growth is evident in the increasing amount of capital invested in cybersecurity as well as in the rising valuation of M&A transactions completed in 2025. Cyber is here to stay. We are seeing high investment values alongside strong M&A multiples. Foreign investors from around the world are investing in Israel at levels not seen before. This reinforces our conviction in the category, particularly in the field of post-quantum security and AI, which will require robust real-time runtime cybersecurity protection solutions. Driven by our strong conviction in cybersecurity, we established CyberFuture at Elron, a prestige cloud that serves as one of Elron's most unique and strategic platforms. CyberFuture operates as a micro fund backed by an investment team of up to 18 global CISOs. Through this platform, Elron gains access and investment opportunities in some of the world's leading cybersecurity companies. CyberFuture has become a highly attractive brand for companies, thanks to the ongoing value we deliver to portfolio companies, leveraging the deep technological expertise and market insights of its members. Our most recent investment in CyberFuture is Zeroport. Let's look at the defense. The geopolitical changes that we are all experiencing has created a significant opportunity in the Defense Tech sector. This is reflected both in the scale of budgets allocated to defense procurement and in the level of investment flowing into this sector. We believe in these tech investments as the key drivers of the Defense Tech space, technologies that will create the competitive differentiation required for this company to succeed. We are confident that through our collaboration with Rafael, we will be able to identify the best investment opportunities and grow these companies to deliver superior returns. Let's talk about partnership, the partnership between Elron and Rafael. A year ago, I transitioned from Rafael to Elron. One of my top priorities was to strengthen the 30-year partnership. What has been missing was the true ownership. Today, I have the privilege of working together in managing RDC with [ Dr. Liat Nakash ], Co-CEO of RDC, who brings extensive knowledge and experience in the field of M&As and legal expertise. In addition, Dr. Erez Berkovich, Rafael Corporate Director of R&D, is also the CTO of our joint investment team. He is personally involved in the technology validation process of every portfolio company and brings in engineers from various disciplines to support each evaluation. And that's just the beginning. As the process advanced, we created structured connections between our portfolio companies and relevant units with Rafael, helping them develop best-in-class products capable of meeting high entry barriers, supporting their journey from early stage to scale up in the defense world. For example, in Wonder Robotics, we believe the right go-to-market strategy for defense lies in the U.S. So we appointed an American Chairperson on also Board because we are convinced that U.S. is the most suitable market for the company. In CyberRidge, we have presented several times, which we have presented several times. We are working together not only in the communication domain, but also in the defense industry. And in Addionics, we are currently supporting the company to expand into the space and defense sector. We are proud of our Deep Tech and defense companies, and we will keep investing in these domains during 2026. And now I'd like to hand the stage over to Ron Rabinowitz, CEO of our beloved company, OpenLegacy. Thank you.

Thank you, Yaniv. I'll project my screen. Here we go. Pleasure to meet you all, and thank you for Elron. Elron has been with us since 2014 and is our lead investor throughout the years. We are operating in Israel from Petah Tikva office, and we deal with legacy systems. The vision is to help enterprises get initially the best out of the legacy systems, and I'm talking about IBM mainframe, S/400, and so on, and then move them to the cloud in a safe manner, in our words, at your own pace. We operate all around the world. As you can see here, there are many familiar names in Israel, like Bezeq, Maccabi, Dolha, Mohit, and so on, all the way to the Citibank and Aviva, and Guardian Life of the world, with representation from Japan all the way to Latin America -- sorry, Latin America and all supported by RD operation in Israel. It would be surprising, actually, if I were to ask you, with the cloud being around for more than 20 years now, how prevalent legacy systems are all over the world. And the fact is, I know you're all in a sound mode, but if we were to run a quiz, I'm sure no one would even get close to the percentage of enterprise workload that is still trapped in legacy systems. Mind you, we're more than 20 years now post the cloud by AWS. So I'll spare you the guesses. The sheer workload is more than 75% according to Market and Markets, IDC, Gartner, et cetera, et cetera. And true, if you look at the insurance space, just to take one example, you have high-end companies like Lemonade, [ Ko ], et cetera, you're familiar with, that were established in the last couple of years, but the vast majority, the MetLifes of the world are still running with IBM mainframe. And this is a huge, huge limitation in many, many respects. So everyone is talking about mainframe modernization. Moving to the cloud, it will reduce system complexity. It will shorten the delivery cycle, a company that is cloud native like Netflix or Facebook can actually constantly deliver innovation to the market, raising unlimited amounts of applications per week, per day, in fact, whereas for an organization with legacy systems, the level of innovation they can introduce to the market is really capped by the silos and the monolith architecture of those legacy systems. Then you have skill shortages. The COBOL, RPG, natural language, I mean, those systems are highly reliable, but they require a very unique skill. There are not many developers these days that study COBOL. The population is typically 50, 60, sometimes 70 years old and above, and it is becoming scarcity. So the sheer existence of those systems represents a risk to the enterprise. And it was like that for 20 years, but now there is a very interesting catalyst, which is AI. The monolith architecture and the fact that those systems are behind an iron curtain, if you will, prohibits the use of AI in many -- in running many of those models in the enterprise. So you could have a limited AI LLM running on your systems on-prem, yes, but still, the level of statistical significance and richness of data and business logic is, by definition, limited. So a lot of chief architects are asking themselves, how can we modernize these systems and enable the enterprise to really take advantage of AI? This is where we come to help because there are many barriers when coming to modernization. There is a good reason why, after 20 years, there are so few successful migrations to the cloud. The first one is system complexity and the risk associated with it. What we do in OpenLegacy, we have a secret sauce of connecting and parsing automatically. We only need to met the data, the input, and the output of the program, if you will, and we create what we call the industry term, an API, the application program interface, which is, if you will, your connectivity layer, like [ Mballip ]. And this enables immediately for this system to become friendly outside. Again, those are highly reliable systems, not so friendly. We automatically parse it and create the connection. The second point is the skill shortages, which I alluded to earlier. We enable every 2 years experienced developers in the future, even citizen developers and business analysts to connect to the legacy systems, no more need for specific skills. It's all in low code, in no code. There is no need to actually get back to COBOL. You could introduce new application, connect to your mainframe, everything in modern languages, or in no code. And then we create a factory. There is no more ad hoc manual effort. Once we come to an enterprise, we create a factory of API. The whole thing becomes systematic, automatic, created to standard. So it's not like you have any deviation room for error for labor. It shortens, obviously, the cycle, needless to say, as a result of automation. And the whole thing is done in parallel to your modernization effort, and I will detail about that. That's the big -- I mean, the first 3 apply to any integration effort. But when you want to move to the cloud, this business continuity is vital because the way all those migration projects have been typically done over the years is by what's called rip and replace. So you stop your operation, you build a new infrastructure, then one day, you turn off here, and you turn on there. And this is very, very scary to save the list. There were cases, even in Israel, that those migrations almost paralyzed the organization. So OpenLegacy basically wants to solve for all that and give a client, no matter where they are on their journey. If they are still in the legacy monolith and they want to start to integrate what we call the augmentation to build more digital services, et cetera, or they want to say, we have what we call the permanent hybrid code list. We have part of the applications and data will move to the cloud. Some will always stay on-prem, that's fine as well, all the way to cloud native. And there are different strategy and different approaches. If you ask industry experts, they will say mainframe will still be here for decades. And some will say, no, it's a matter of 5 to 10 years now with AI. And we don't even take a clear stand on this. We just offer the full optionality to the clients to do it at their own pace. Obviously, as opposed to IBM, I will be a bit bold here, which is our direct competitor in the space. We are pro modernization Pro cloud, which brings us also to our new go-to-market approach. And as a result, there is a very clear ROI. We remove with the automated factory a lot of the cost barriers. Everything is created to standard, which means that there is less error, less risk and the accelerated acceleration is achieved not at the price of cost or any other compromise on standard. It is as a result of not despite. So if you look at architecture, I will not go into very complex scheme now, but it's like the strangler effect, if you heard the term, you build something in parallel to something rather than immediate rip and replace. You have your integration factories, which will enable business continuity, and you have the migration factory, both running in parallel. And then one day, at your choice, legacy disappears, it's all on the cloud. We essentially build bridges that enable you this coexistence until the day that you no longer need it. It can take 5 years, it can take more than that. It's all up to you, up to the customer. The customers -- the customer list that we presented initially was built over the last 10 years in OpenLegacy, and we did most of that in direct sales. We're now switching gears to partner with the hyperscalers. If you look at the market now, and again, this is an aggregation taken from LLMs based on the researchers, IBM financial reports, cloud providers, and so on. There are about 10 billion to -- if I round the numbers, $10 billion to $20 billion or $11 billion to $18.5 billion to be more accurate according to researchers that are direct potential ARR, annual recurring revenue that sits on those mainframe on the workloads on those Fortune 500 Global 2000 companies that right now belong to IBM and could move to the cloud over time. But then if you take AI also, you have what's called indirect ARR for the hyperscalers, all the bedrock type of application from AWS, if you've heard, and so on, that can actually build a huge business for the cloud providers if they just take this infrastructure from on-prem and move it to the cloud. This represents a huge, massive growth opportunity for all 3 hyperscalers, and OpenLegacy is well-positioned to enable this. We've started to partner with AWS under the premises that we can accelerate active modernization. So if you have a migration project and you need to break the model and start to move domains to the cloud, OpenLegacy can really help do that safely. We can increase the conversion from assessment to migration. Actually, you will be surprised how many enterprises are doing the assessment. Assessment is what actually exists on my legacy. If I want to start planning a migration, but how few migrations actually start because of the risk elements, the complexity, all the things we mentioned before. So we could help AWS not only with active modernization acceleration, but also in the sheer start in increasing the conversion from assessment to migration. And then even enterprises that are not yet ready where they want to be -- they don't -- are not yet sure whether they're going to go all the way or stay hybrid cloud, we can make the migration ready so that as soon as they want to press the button and start to do even a small step, they can do it. So the project no longer to be -- needs to be big $50 billion type of project over years, et cetera. You could literally start tomorrow. And we compose -- we are composed into the AWS ATX, which is their mega migration platform that was recently launched in the way that, over time, will be able AWS product to become more self-service, which is their vision. So we're partnering with them. We started on the competency center about 1.5 years ago, and we're progressing. There are different stages of this partnership, but it will include full embedding of the Fulton legacy within the AWS ATX product, commercial element of favorable terms to AWS customers. And it enables us now after we build in the first 10 years, this layer of Tier 1 customers all over the world, now to build on partners, whether it's AWS sales teams, whether it's the GSIs, global system integrators like Accenture, Deloitte, et cetera, working on the AWS migration efforts enables us to go to market together with them. So that's where we're going to fit in the AWS product strategy. And this is ultimately the result of this go-to-market, what we call now Stage 2 of OpenLegacy, which is higher in conversion based on AWS validation. And the fact that our APIs, our decoupling is used for modularization, that's the use case, which everyone is after. lower friction on the sales cycle because we're commercially supported by AWS and its ecosystems. And then those projects tend to be of very high value to the customer. They're not just -- it's not just creating another application or something like that. It's a monumental strategic infrastructure change. Based on this, we believe that Google and Microsoft will be our next to partner with, and we're looking forward to it. Thank you very much. Happy to take any questions in a few minutes time.

Thank you, Ron. So one question actually here popped up before we are giving at the stage to the CEO of Addionics. OpenLegacy currently is basically what you have done during the last year, might be that a solution currently, what is happening there today in the negativity side of the software. So can you please connect that what is happening there today in the ecosystem of the software and how OpenLegacy can be actually a solution and how your partners are seeing that this?

Yes. Let's separate between SaaS companies that are providing applications from DocuSign all the way to Salesforce. So it could be very, very narrow vertical all the way to CRM or even ERP, like ServiceNow or SAP, et cetera, et cetera. That is one area which is threatened by AI because at the end of the day, when you can program something that is running on the cloud, open to everyone, there is the risk that AI will be able to do the same, at least on the simple level of the application, those that require less security that are more open, that are consumed by smaller organization. Frankly, it's difficult for us to see how larger ServiceNow clients, for example, decommission ServiceNow tomorrow. But for sure, there is less upside and more downside for those companies. And it's a big discussion. The papers are all over it. So I think we'll leave it as is for now. We're operating in a different space. We're part of the infrastructure itself. And what we're actually doing is enabling those enterprises that are currently locked. Again, it's all behind the iron curtain, and every system stands for itself. It's highly customized. We were growing step by step over the year because every customer actually requires their own treatment. We have a product that is by now with a lot of know-how adapted to, let's say, 80% of the legacy market. And still, from time to time, we need to do customization. This is not something that LLM will be able to immediately replicate tomorrow. It is highly, highly complex and customized. But we are enabling to change this and enable over time, those enterprises to benefit from AI. That's what we want to do. And we were fortunate not to be a SaaS vertical type of company with the proud and conduct.

Just to add that the data that OpenLegacy will expose from the mainframe will join other data verticals or sources that are already exposed in the cloud, and this is the great potential behind it. The most important, like core data of the company that currently is in the mainframe, will be exposed and processed by the LLM to create unique answers behind it to use this data to create more accurate answers inside the organization. Thank you, Ron.

And now we give the stage to the CEO of Addionics, Moshiel Biton. Go ahead.

Thank you, Lisya. Thank you, Yaniv. My name is Moshiel. I'm the CEO and Co-Founder of Addionics. My background is material science. I have a PhD and post from Imperial College London in the field of battery, material science, solid-state physics. And Addionics is a smart metal company with our flagship product in the battery domain. We are lucky to have Elron as an investor in our company. You can see that we have a very good mix between strategic investor to financial investors. And lately, Elron invested in the company, Lisya joined as a Board Director, bringing lots of strategic perspective into the table. So we are lucky that she is helping us to promote all the strategic moves. And also, Yaniv, which is a vast experience in defense sector, is helping us to penetrate into the defense market. And already in such a short time, we have lots of, I would say, achievements, which is incredible. And thank you Ron for this push and for this support. We raised, in total, including grants, almost USD 90 million. We have a very strong IP behind us. We have a very, I would say, large patent portfolio, but I think the best -- the most important barrier of entry and most of the technology is the fact that we are moving fast and always developing our next generation of technology. And we are very attractive for different players in the supply chain, and we build a very unique position by working with different levels in the supply chain, from mining companies to end users and in between cell manufacturers, metal manufacturers, machinery providers. Recently, we launched our 0.5 up to 0.5 gigawatt-hour facility in Tel Aviv. So this is very exciting to see production in a fleet called Totseret HaArets. So production that's made in Israel literally. Majority of the employees are based in Tel Aviv in Israel. And mostly, we have R&D, mechanical engineer, electrical engineer.

I have to say that whoever is landing that from America to Israel wants to go and to see the production center that Addionics has built. It is incredible to see that a production center that Addionics has built inside Tel Aviv. So for everyone that they want to visit, it is an incredible place to be in and to see the future of the company.

Indeed, thank you, Lisya. So yes, it's very attractive because it's a different, I would say, in the landscape of Tel Aviv. In Israel, we are building big tech hardware technology that most of the companies, of course, focusing on different areas. And in that way, we are also very unique. Our flagship products are 3D current collector. Current collector is a component in a battery that was overlooked. It's like the kid in the class that no one wants to play with or dance with. And now it's the revenge of that kid. It's a 2-dimensional foil similar to the foil that you have in your kitchen. And believe it or not, it hasn't changed in the last 40 years. The architecture remains the same. And what we do, we are creating more real estate to load more active material. So we changed the proportion between the energy, the active material in the battery to the inactive components in the battery. Think about like a sandwich, you have slice of bread, and a slice of cheese. So the bread in the industry today is very dense 2D, and we're making the bread fluffy 3D pals. So we can put cheese not only on the top of the bread, but also inside. And the cheese is the energy, and that's what we are bringing more energy. And we traditionally worked with and still working with many automotive players and users. And lately, we see advantage also in other markets because we are also not only attractive to the bus market, but also in terms of improvement of performance. We managed to improve cycle life dramatically, energy density, and other capabilities. We really use a methodology and approach that we build in the company as a feedback loop. We are pioneering in this area. And to the best of our knowledge, we are the only company in the world that can relate the properties of the current collector with the battery performance. And we are taking this methodology and apply it to different applications and different verticals. And the vision is to take it even beyond batteries and to take it to other markets. In the battery race, you have many technologies, many different types of focus, mostly. We are agnostic to chemistry. We are not limited to one battery chemistry or battery format, or one battery process. We are agnostic. And it's a drop-in solution, so we can integrate into existing facility. So this is the facility that Lisya and myself mentioned, you are welcome to visit. We are making the process of material by using existing CapEx and managed to retrofit the existing CapEx. It's a low-cost CapEx, and that's what makes our solution very attractive because we're using low-cost CapEx. But today, the CapEx produce commodity. But with our innovation, we can produce highly differentiated product. And this is what the industry is looking for, and we are able to leverage and improve batteries, any type of batteries. And the methodology that we are taking is not we are building a battery, complete battery, building a demand, and then looking for a client or customers. The opposite. We are working closely with customers that helping with us to build the product. We understand the pain and building a customized product that's suitable for them and perfect for them. So we know that they are going to use it after the development. So that's something that we developed from day 1, really working closely with the market, with the industry. We already managed to integrate in, I would say, Gigafactory-like production lines with, I would say, no change in the CapEx, 0 change. It's something that's giving us the ability to integrate and to be relevant to different type of manufacturers, different type of tools, and also to be able to meet the demands of mass market. and the industry standard that's required for that to commercial applications. So really working backwards, understanding what is needed in order to build this technology at scale, and then working backwards to understand what is needed in order to design, to develop, to manufacture, to integrate. And we're really focusing all those steps from the design to the manufacturing integration and even operation during the usage of the battery. We are solving many, I would say, applications challenges. We're talking about drone application or defense application, we know that in the battlefield, the drone is similar to wet, for instance, and energy is essential in order to protect soldiers or to create advantage in the battlefield. And the energy that is needed is limited. And most of the batteries that existing today in the market, a, it's controlled by China; and b, they build for the mass market, not for niche technology to build for the automotive market to the storage market. And we really, I would say, capture the gap that these companies need special batteries for specific application for specific mission, and we can tailor and design the cell in a way that will answer a specific mission. If we are talking about higher energy density, but lower weight for storage, for instance, batteries, the weight is not important because it's not mobile. But for a drone, it's critical if we want to increase the charging time. So in the first I would say, minutes of the charging time, the battery degrades. We are putting lots of energy inside the battery. So it creates lots of heat, and we can remove and reduce. So minimizing the challenges and the trade-off between power to energy. And that's something that was the holy grail of the battery. Everyone wants high power and high energy simultaneously, but it's not possible to achieve it with existing technology. And in some applications, some mission, we need reliability and robustness that is not similar to what we have on air. For instance, if we want to power our satellite and satellite requirements are different from application on air, satellite can spin 10 times a day. It's 90 minutes each spin, 60 minutes lice when we have solar panels and operate from the panels, but 30 minutes start that needs to cooperate from the battery. So many cycles. And this type of battery is what is very ironic. It's only a fraction of the cost of the satellite, like below 1%. And what determines the lifetime of the satellite is the battery. So when the battery is dead, the satellite is dead. There is no garaging space that you can swap batteries. So in that way, our advantages of increasing lifetime, it's critical to make the mission more productive. In terms of markets, as mentioned before, we were very active and still active in the automotive business. It gave us the credibility and the ability for us to build at scale. But we also recognize that there are many other applications that require specific, I would say, capabilities, and there are gaps and challenges. And in the way that we -- the methodology that we build to make sure that we can narrow the gap of the mass production that focus on cost mainly and scale, and the small manufacturers that actually need to have high performance. So we are working closely with cell manufacturers to tailor the specification and the performance for existing applications. And this is something unique because we can really do it for different applications. We can make different design for specific applications, and that's like one of the core technologies. And we understand how this industry is conservative and traditional. And the holy grail is to make a small change, and we are not making a huge change in changing the whole battery, but the impact is huge. So it's effect as mentioned, the charging speed, the energy density, the thermal safety, and this is like a drop-in solution. So also for the industry and the same manufacturer, it's not something that they need to switch or replace all the manufacturing processes. In terms of potential and strategic potential, we can take those methodologies and apply it to other markets. And even in just the battery market is already huge, and there are many, I would say, benchmark and I would say, similar companies that have been active in the field. If we are talking, for instance, about ETech, it's a company that's making separator being acquired for $800 million recently. And they are wanting to make a change in the separator market that is led by big monopoles. And they managed to create a differentiation in this inactive component, and it gives us also more, I would say, credibility in that space so we can take components and make from those companies a component really strategic potential for the battery world, where we can have like TotalEnergies that acquired SAF for more than $1.1 billion. And this is another like, I would say, example of how in that market with a small segment because SAF are making cells for space Formula 1 and not for the entire market, and they cannot compete with the mass production of the Chinese cell manufacturers, but they found a niche and still with lots of value. And the goal is to take this methodology and to apply that also for other industries. And some of the biggest, I would say, players in the market really see that potential in those methodologies and how to apply to other industries. Just yesterday, we had a Japanese delegation, and we met with Lisya and Yaniv, and they show interest also not only in this field and not only to take it to scale and to use it in mass production globally, but also to take it to other applications. So thank you very much.

Thank you, Moshiel. Addionics is one of the examples that we are seeing that in the market that the technology in the automotive sector can be also used for the different sectors like Deep Tech and like Defense Tech. And the solution of the -- and that was also one of the questions actually that came back to the chat. The solution, what you are doing at Moshiel, is a physical solution, not a chemical solution. So practically, it can be implemented in the existing manufacturing system of all subsectors that we are talking. It doesn't matter if it's defense, Deep Tech space, or that automotive industry. Do you see that an interest also from that side in terms of implementation, execution, not waiting for the next 10 years revenues, but happening that now. Can you elaborate a little bit about this point?

Yes. Thank you, Lisya. So definitely, we are agnostic. We are creating, I would say, a physical product. As a company, our philosophy is always to innovate and to understand how we can extract more performance from specific application. And that definitely we see a request and inbound, I would say, activities from different markets. And that makes our solution very unique. And we are starting to be a pivotal player in specific markets while connecting the dots between different players in the market, and we are leading those activities. And we gained lots of knowledge we started the company 8 years ago. So since then, we gained lots of knowledge and IP, and we are applying now this is in different verticals. We have, I would say, many experts in the company. And the goal is to really to bring the semiconductor brand into those areas of like smart metals in batteries first, but also to take it to other applications later on.

Perfect. Thank you. I appreciate it. Thank you, Moshe, for joining us at Elron Ventures Investor webinar. We appreciate that, and thank you for coming back to the webinar. I would like to address the last question that came back on the chat regarding the dividend distribution of the Elron's policy. Yes, we have put that our estimation, and we will do everything for 2026 possible. The Elron management will make everything to execute what has been promised towards to the shareholders, which means that we estimate between 1 to 3 exit potential from all portfolio companies of Elron, including all our vehicles. This said, it will be done by primary or secondary transactions. The dividend distribution policy is a very clear policy that we have implemented less than 1.5 years ago. The dividend distribution policy is linked to the exit of the portfolio companies, which is at minimum 25% of the exit value. So these numbers are -- the policy remains the same, and we will keep executing what we have promised. So of course, I cannot tell which companies will be exited or what will be the value of the exit transactions. This -- we are not like we need to respect the rules of the Israeli security. However, -- and with it that we promised that to keep that our promises and to execute what we have promised, which means to invest in our companies, to scale them up, to bring them towards the exit routes, and to execute more and more in 2026 as we have done in 2025. Thank you.