PCB Technologies buys Gorilla Circuits for $120 million, Rein Security raises $25 million, and HoneyBook cuts jobs

Noa An Israeli circuit board maker is buying its way into Silicon Valley. PCB Technologies has agreed to acquire Gorilla Circuits of San Jose, at an enterprise value of $120 million.

Eli It is buying a company whose adjusted earnings more than quadrupled last year.

Noa Good morning, it's Friday, the ninth of October. I'm Noa.

Eli And I'm Eli.

Noa Today: PCB Technologies goes shopping in California, Rein Security raises $25 million to guard AI agents, HoneyBook and Silk cut jobs, and the founder of MonsterCloud is charged in New York.

Noa PCB Technologies first. The company, based in Migdal HaEmek and listed in Tel Aviv, says it will buy all of Gorilla Circuits. The price works out to about 7.6 times Gorilla's average EBITDA.

Eli Gorilla has been making and assembling circuit boards in San Jose for more than 20 years. According to CTech, it employs over 320 people and has more than 700 active customers. In the first half of this year, about 40 percent of its business came from aerospace and defense, and 35 percent from technology and semiconductors.

Noa And it is growing fast. CTech reports Gorilla's revenue rose from $69.4 million in 2024 to $91.9 million last year, while adjusted EBITDA jumped from $3 million to $13.6 million.

Eli Compare that with the buyer. PCB Technologies is worth about a billion shekels on the market. Its revenue in the second quarter fell to 139 million shekels, and net profit slipped to 3 million shekels. So this is a big step for it.

Noa The company says the deal gives it a manufacturing base in the United States, and access to North American technology, aerospace and defense customers. It will be paid for with credit from two Israeli banks.

Eli Closing still needs approval from CFIUS, the US committee that reviews foreign investment, and is expected within eight months.

Eli Yesterday we told you that at least 20 Israeli startups are working on security for AI agents. Today, another one raised money. Rein Security has closed a $25 million Series A, bringing its total to $35 million.

Noa According to CTech, the round was co-led by Glilot Capital and Sienna Venture Capital, with Corner Ventures, Atlacle and RNP Capital Advisors joining. Rein was founded in 2024 by Matan Bar-Efrat and Netanel Rubin, and has 31 employees in Tel Aviv and New York.

Eli Geektime says Rein started out securing applications, and turned its technology toward AI agents. Rubin told CTech the focus is agents that companies build themselves, inside their own cloud. The company says revenue has grown eightfold since its product launched in January.

Noa Rubin gave Geektime one example. An attacker posed as a legitimate company with a legitimate website. When a customer's agent visited that site, hidden instructions in the page told it to pull other customers' confidential data. Rein says it caught the attack in real time.

Noa Now to jobs. HoneyBook, which makes business software for small businesses in the US, is laying off about 14 percent of its 255 employees. CTech puts it at 30 to 35 people, most of them in Israel.

Eli The company says it is reorganizing to fit the AI era, and that the move comes from financial strength. CTech estimates it has hundreds of millions of dollars in cash, and Calcalist learned it extended departing employees' stock options.

Noa Globes adds the context. HoneyBook has raised half a billion dollars and was valued at about $2 billion in its last round. Its market is now being challenged by vibe coding tools, like Wix's Base44 and Lovable, and by owners who build with Claude Code.

Eli Globes also reports cuts at Silk, a data storage startup from Yokneam. It estimates more than 30 people have gone in recent weeks, about a quarter of research and development, mostly in testing and software development. That came alongside $45 million in equity and debt led by Avenue Capital. Silk did not respond to Globes.

Noa In New York, the founder of a cybersecurity firm is facing fraud charges. The Jerusalem Post, citing the US Justice Department, reports that Zohar Pinhasi of Florida-based MonsterCloud, an Israeli-US dual national, was charged on Wednesday with wire fraud and wire fraud conspiracy.

Eli Prosecutors allege he told ransomware victims his company could decrypt their data with its own tools, when in fact he paid the attackers for the keys. They allege he collected more than $19 million in fees, and paid over $8 million to the criminals.

Noa Pinhasi has pleaded not guilty and was released on $2 million bail. None of the allegations has been proven.

Eli Last, policy. The Times of Israel reports on an interim Finance Ministry report, led by chief economist Dr. Samuel Abramzon, on what AI could do to the state's tax base. The share of Israeli businesses using AI rose from 28 percent last year to 39 percent this year, against an EU average of 20.

Noa The worry is that if AI shrinks labor's share of the economy, income tax falls with it, and tech employees contribute more than a third of all Israeli tax income.

Eli The report rejects a dedicated AI tax, fearing it would hurt the economy. Instead it suggests taxes on undeveloped land, capital gains on shares and options, equity compensation, luxury goods, and VAT on imported digital services.

Noa Now the quick round-up.

Eli Phantom GI, a Tel Aviv medical device startup, has raised a $5 million seed round led by Pitango, with RAD Biomed and RUNI Ventures, CTech and citybiz report. It is developing a way to create an ostomy with a needle puncture and local anesthesia, instead of major surgery, and plans its first US clinical studies.

Noa Israel's Privacy Protection Authority says the Education Ministry broke the privacy law after sensitive data on about 21,000 special education students reached unauthorized people, The Jerusalem Post reports. A file of student records had been set so anyone with the link could open it. The authority did not specify a fine.

Eli And Globes reports the Tel Aviv Stock Exchange is examining a bid for the business of the Cyprus Stock Exchange, which is being privatized. The move is at an early stage, at a valuation in the tens of millions of euros, and Europe's Euronext is a prominent candidate.

Noa What to watch: CFIUS. PCB Technologies' purchase of Gorilla Circuits cannot close without the US regulator's approval, and with about 40 percent of Gorilla's business in aerospace and defense, that review is the main thing standing between the deal and its expected close within eight months.

Eli Follow Israel Tech Daily wherever you get your podcasts, and read more at startuptofollow.com.

Noa Shabbat shalom. See you Sunday morning.