What Happened

Dream, the Israeli AI cybersecurity startup co-founded by Shalev Hulio in January 2023, is expanding into Latin America. The company, which tripled its valuation to $3 billion this year, is targeting governments aligned with Washington in a region where cyber attacks are reportedly growing 25% annually and national defenses rank among the weakest in the world.

The expansion is notable for what Hulio built before. He created NSO Group, the Israeli surveillance firm whose Pegasus spyware was used by governments to monitor journalists, activists, and political opponents across more than 50 countries. NSO Group was blacklisted by the US Commerce Department in November 2021. Hulio resigned as NSO's CEO in August 2022 and founded Dream months later, positioning it as a purely defensive cybersecurity company.

Dream's co-founders include Sebastian Kurz, the former Austrian Chancellor who was acquitted on appeal in May 2025 of making false statements to a parliamentary inquiry, and Gil Dolev, founder of intelligence-gathering firm Wayout Group. The company has more than 300 employees across offices in Tel Aviv, Vienna, and Abu Dhabi, with a Munich office planned. It operates a sovereign data center near Modiin, Israel, where it trains proprietary language models without relying on public cloud providers.

Dream's sales have reportedly exceeded $300 million, more than doubling over the past two years. Its investors include Bicycle Capital and Group 11.

Why It Matters

The sovereign AI defense market is becoming a multi-continent business, and Dream's expansion into Latin America illustrates the dynamics that determine who wins. The primary currency is not technical capability alone — it is government-to-government trust. Selling sovereign AI platforms to national security agencies requires a level of political intimacy that commercial cybersecurity contracts do not.

Dream's push coincides with a rightward shift in Latin America that has brought several Israel-friendly leaders to power. Argentina's Javier Milei has aligned Buenos Aires closely with both Washington and Tel Aviv. In Colombia, Abelardo De la Espriella won the presidential runoff on June 21 with 49.66% of the vote and has pledged to restore diplomatic relations with Israel that his predecessor suspended in 2024.

The commercial logic is clear: sell to governments that need the technology, can afford it, and are politically willing to buy from an Israeli firm. Latin America's cybersecurity budgets are growing from a very low base — the World Bank scored the region's countries an average of 10.2 out of 20 on cybersecurity preparedness. Costa Rica's 2022 experience, where Conti and Hive ransomware groups crippled roughly 30 government institutions and forced a national emergency declaration, demonstrated the stakes.

But the Pegasus question looms. Dream's expansion into a region where surveillance technology has been exported to governments with poor human-rights records invites scrutiny. Whether Latin American civil-society groups will accept the distinction between offensive surveillance and defensive AI remains an open question.

Who Is Affected

AI cybersecurity startups building government-facing products — particularly those requiring sovereign infrastructure and air-gapped deployment — face a new well-capitalized competitor with deep government relationships. Enterprise IT buyers in Latin America may see increased competition for cybersecurity talent as governments invest. Civil society organizations and privacy advocates in the region are directly affected, given the documented history of governments using surveillance tools against domestic opponents and Hulio's role in building the most powerful one.

Strategic Implications

For AI startup founders: If you're building defensive AI for government clients, the sovereign infrastructure requirement — private data centers, no public cloud, proprietary model training — is table stakes, not a differentiator. Dream's model of training proprietary LLMs in air-gapped environments is the baseline expectation. Your differentiator must be political relationships, regulatory compliance, and proven deployment track record.

For developers/operators building with AI APIs: Government cybersecurity AI is a fundamentally different stack from commercial AI. No API calls to OpenAI or Anthropic. No public cloud training. If you're targeting this market, plan for on-prem model training and sovereign data residency from day one. Startups like Rilian are also raising funding for air-gapped government AI, suggesting the category is expanding but still early.

For non-technical business owners evaluating AI tools: The Latin American cybersecurity market is growing fast from a low base. Regional governments will be aggressively procuring AI-driven defense tools. If you operate in the region, expect your government to become a Dream customer — and expect the political debate around surveillance vs. defense to intensify. The man who built Pegasus selling the antidote is a story that will not go quietly.

What to Watch Next

Monitor whether Dream publicly names any Latin American government clients in the next 6-12 months, which would signal whether the political alignment thesis is converting to contracts. Watch for civil society pushback in target countries, particularly from privacy and press freedom organizations. Track whether competitors like Rilian announce Latin American government deals, which would indicate the market is large enough for multiple players.

Frequently Asked Questions

Q: Who founded Dream and what is its connection to Pegasus?

A: Dream was co-founded in January 2023 by Shalev Hulio, the creator of NSO Group's Pegasus spyware. Hulio resigned as NSO's CEO in August 2022 and positioned Dream as a purely defensive cybersecurity company, distinct from NSO's offensive surveillance tools.

Q: Why is Dream expanding into Latin America?

A: Latin America is the world's fastest-growing market for cyber attacks (approximately 25% annually) with some of the weakest national defenses (World Bank score: 10.2/20). The region's rightward political shift has brought Israel-friendly governments to power, creating the political trust necessary for Dream to sell sovereign AI defense platforms.