From $1.2 billion to under $500 million. That's how far Hailo's valuation has fallen as the Israeli AI chip startup scrambles for a public listing through a SPAC merger.
Hailo, founded in 2017 by alumni of Israel's Unit 81 intelligence unit, builds processors designed for edge AI - running AI models directly on devices like cameras and robots instead of in cloud data centers. The company hit unicorn status in 2021 after raising $136 million, then pushed its valuation to $1.2 billion with a $120 million Series C extension in April 2024.
The cash picture has deteriorated fast. Delek Automotive, which holds a 12.1% stake, booked a $77 million loss on its Hailo investment in 2025. The book value of Delek's stake cratered from roughly $412 million to $55 million in a single year. In January 2026, Delek had to provide Hailo a $9 million emergency loan at 1.5% monthly interest, a rate that doubles to 3% if the company doesn't achieve liquidity within a year.
That same month, Hailo laid off about 10% of its workforce and narrowed its focus to robotics.
A non-binding memorandum for a SPAC merger was signed in March 2026, with an official listing expected in the coming months. SPACs - special purpose acquisition companies that let startups go public by merging with an already-listed shell company - were popular during the 2021 boom but have since earned a reputation as a last resort for companies that can't attract traditional IPO interest.
The broader context here matters. Edge AI chips were supposed to be the next big hardware market, but Nvidia's dominance in data center GPUs has sucked up most of the AI investment oxygen. Smaller chip startups like Hailo are caught between needing massive capital to compete and investors who increasingly want to see revenue before writing checks. A sub-$500 million SPAC isn't a triumphant public debut - it's a survival move.