In recent years, a growing number of Israeli entrepreneurs and families from Tel Aviv, Haifa, Jerusalem, Ramat Gan, and Herzliya have turned to Luxembourg to structure their international investments and protect their assets. Renowned for its financial stability, investor-friendly legislation, and sophisticated legal tools, Luxembourg is fast becoming a strategic choice for high-net-worth individuals and startups seeking robust asset protection and long-term wealth preservation.
Why Israeli Entrepreneurs choose Luxembourg?
Luxembourg is more than just a European banking hub. It offers a suite of flexible and secure investment vehicles tailored to meet the needs of tech-savvy, internationally-minded Israeli entrepreneurs:
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SOPARFI (Société de Participations Financières): A holding company regime ideal for organizing private or corporate holdings in global businesses, real estate, or private equity. SOPARFI benefits from Luxembourg’s extensive tax treaty network (over 80 countries), zero withholding tax on outbound dividends (under conditions), and a participation exemption regime. (check our SOPARFI guide)
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SPF (Société de gestion de Patrimoine Familial): Designed specifically for individuals and families to manage private wealth. The SPF is exempt from corporate income tax, municipal business tax, and net wealth tax, making it an optimal tool for discreet and efficient wealth preservation.
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SCSp (Special Limited Partnership): A highly flexible, contract-based vehicle widely used in venture capital, private equity, and real estate investment. The SCSp is fiscally transparent and does not require legal personality, offering total confidentiality and control.
Why Israeli Entrepreneurs Are Making the Move
Israel is a global innovation powerhouse, often referred to as the “Startup Nation.” According to StartupBlink’s Global Startup Ecosystem Index 2024, Israel ranks #3 globally. With over 6,000 active startups, Israeli tech talent continues to generate international interest and capital.
However, due to increasing regulatory scrutiny and geopolitical instability in the region, many founders and investors are seeking to structure their assets in more neutral and stable jurisdictions.
Luxembourg provides:
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Political neutrality and AAA-rated economic stability
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Confidentiality and legal asset shielding
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Smooth intergenerational wealth transfer mechanisms
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Efficient exit planning for IPOs, M&As, and real estate disposals
5 Fast-Growing Israeli Startups Benefiting from Global Structuring
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Wiz (Tel Aviv) – A cybersecurity unicorn valued at over $10 billion.
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DriveNets (Ra’anana) – Disrupting network infrastructure, raising over $500 million.
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Papaya Global (Tel Aviv) – A payroll platform operating in 160+ countries.
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AI21 Labs (Tel Aviv) – Competing in generative AI, raising $208 million in 2023.
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Electreon (Beit Yanai) – Developing wireless electric road technology, with global pilot projects underway.
Founders and investors in these companies often need safe, tax-optimized vehicles for global revenue, IP royalties, or personal holdings—areas where Luxembourg excels.
Luxembourg as a Gateway for Investments In and Outside Israel
Luxembourg investment vehicles can hold shares in Israeli companies, real estate, or foreign subsidiaries. For example:
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An Israeli entrepreneur can use a Luxembourg SOPARFI to invest in European startups or acquire real estate in the U.S. while benefiting from tax-efficient exit options.
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Families based in Jerusalem or Haifa can establish an SPF to hold passive financial assets such as bonds, shares, or life insurance contracts outside Israel.
This structure also provides shielding from potential legal claims, enhancing asset continuity across generations.
A Strategic Asset Shelter for Israeli entrepreneurs
Whether your fortune stems from cybersecurity, biotech, agritech, or fintech, Luxembourg provides a reputable, future-proof framework for managing personal or corporate wealth across borders.
At Damalion, we specialize in helping Israeli entrepreneurs, tech founders, and families access the right Luxembourg structures for optimal legal, tax, and financial protection. Our network of legal, banking, and fund administration partners ensures seamless, compliant setups tailored to your specific needs.
Contact Damalion today to structure your investments in Luxembourg and protect your legacy across generations. This communication is for informative purpose only. Damalion focused on advising families for wealth preservation by identifying opportunities and challenges.