Israeli VCs see opening for challengers amid Nvidia turmoil

The resignation of Jensen Huang as CEO of US semiconductor giant Nvidia has been met with concern in Israel, which he called the company's "second home" in 2023. Nvidia's GPUs are central to training and running large language models, so the industry is asking how big a shake-up the leadership crisis will bring. Some Israeli venture capital investors see an opportunity for competitors.

Nvidia's role in Israel

In 2019, Huang led Nvidia's $6.9 billion acquisition of Israeli chipmaker Mellanox and built the company's largest R&D facility outside the US on that base. Nvidia has also planned a multibillion-dollar campus in northern Israel. It employs 6,000 people in the country, and Intel, Microsoft and many local startups also carry out a sizable share of their R&D there.

Israeli serial cybersecurity entrepreneur Pavel Gurvich told TechCrunch that the Israeli tech community feels strongly positive toward Nvidia and Huang, because he brought the company to the country.

Who may come next

CFO Colette Kress is interim CEO. In a 2023 interview now circulating on X, she said she typically began her day with Israel meetings before continuing to California. Names floated for the permanent role include two Israelis, Apple's Johny Srouji and Nvidia's Michael Kagan, though neither is at the top of the tentative list.

Investor views

Yanai Oron, general partner at Vertex Ventures Israel, said slower decisions at Nvidia could give competitors an opening, but if the uncertainty also slows AI spending, they could end up with a bigger share of a smaller opportunity. Adi Levanon, founder and managing partner at Selah Ventures, said Huang's departure does not dismantle Nvidia's technology or ecosystem but could give rivals more room to shape what comes next. He noted that developers of AI-specific chips and inference software are already attracting interest and some venture capital, and have a window to prove that a different approach delivers better economics.