In Musk's Crosshairs: Descartes in Talks for $6 Billion Sale
Israeli startup Descartes is in advanced talks to be acquired by a major international player for $6-7 billion. SpaceX is considered the primary candidate for the acquisition.
A major deal is brewing in the Israeli high-tech sector: Calcalist has learned that Descartes is on the verge of being sold to a major international player for approximately $6-7 billion. The deal is reportedly in advanced draft stages and could be signed as early as next week.
Initial negotiations were held with Nvidia, but after a larger player emerged, the founders decided to pivot. Industry sources suggest the buyer is Elon Musk's SpaceX, as few companies exceed Nvidia in scale. Amazon and the cloud company Nebius are also reportedly interested. The process is taking place in the USA, and Descartes has provided no comment.
Market Impact and Musk's Interest
If successful, the deal would be a landmark event for Israeli high-tech, as SpaceX would establish its first R&D center in Tel Aviv. Musk has followed Descartes closely since 2024, when the company launched the OASIS game, based on its real-time video generation technology. After the game reached one million users in three days, Musk tweeted "Wow" on X.
Sean Maguire, a partner at Sequoia and a close associate of Musk, is a central investor in Descartes. Maguire organized Musk's visit to Israel after October 7. SpaceX, which recently raised $75 billion, is aggressively expanding its AI infrastructure and its large language model (LLM) GROK. Descartes' software, which optimizes computing power, could be a strategic asset for Musk's AI ambitions.
From Unit 8200 to Global Ambitions
Descartes was founded in 2023 by Dean Leitersdorf (27) and Moshe Shalev (38), who met during their service in the IDF's Unit 8200. Despite its short lifespan, the company has raised approximately $450 million. A funding round last May valued the startup at $4 billion.
Leitersdorf, a prodigy who earned a PhD in computer science at 23, and Shalev, who transitioned from an ultra-Orthodox background to elite tech units, aimed to build an AI giant comparable to Apple or Google. Their technology, which creates video at significantly lower costs than competing models, has made the startup a prime target for chip manufacturers and cloud providers.
