It's the same reason F1 is British
There are no other jobs in Israel.
You get good grades in maths and science and then there are no jobs. Outside the defense sector there are no big employers, no 'city' jobs for quants. You have a choice of starting your own company or emigrating.
It's the same reason the chief engineer at Williams gave for why all the F1 teams are in Britain. If you are a German engineering graduate you can work on BMW, Audi, Porsche, etc. If you are a British graduate your choice is doing the door handles on the Morris Minor or working in F1 (it was a few years ago).
Anon cos I work in one of those Isreali startups - although in the USA.