Krav Maga is one of, so called, Modern Martial Arts. I see questions asked on Martial Arts forums about validity of Modern Marital Arts vs. Traditional Arts, like karate. Those questions are often surrounding names like Systema (which is breaking-away development of Combat SAMBO) and Krav Maga. I’m addressing some of those questions on different pages of this site, but the notion of Modern Martial Arts vs. Traditional is worth throughout discussion on its own.
The crude division line between Modern and Traditional Martial Arts can be seen as a division between Western Military Combative systems and Eastern Martial Arts. Among Western Military combat styles Krav Maga is stands alone as it’s defined as self-contained system and gaining wide spread popularity in civilian, police, and military training.
Very often Modern (Krav Maga and other) Martial Arts praised for their practicality when Traditional styles bashed for been overcomplicated non-practical sport-only or health-only exercises. Well, it’s done by people who have neither knowledge of ether Modern nor Traditional Arts, or have their own business agenda to advance...
I said “so called” Modern Martial Arts because I don’t see basis to call it Modern.
Modern status of Krav Maga is best understood in light of old Okinawan ryu history and how it became Japanese karate.
As Chinese fighting styles formed basis of Okinawan ryu by the break of 20th century, they formed extremely practical and very modern fighting system. It was seen as very practical, but unrefined by Japanese who saw an ideal Martial Art in their native Judo and kendo. With introduction to Japan Okinawan ryu ware modernized and became karate (under acceptance of requirements from Budokan). At the time Japanese saw modernity in uniformity. So, this modernization included technical standardization, introduction of standard uniform and ranking (Judo-style), introduction of competition format, and development of safe forms / katas to be used in school setting. As this process was stopped mid-way by WWII karate remains multi-faced style with great variety between its schools in training curriculum, technical sets, and even general fighting strategy.
As today's karate diversity is result of aborted unification process, in early post-WWII years, that left many teachers on their own (and actually "forced" them to become founders of their own schools), the nowadays Krav Maga going through the similar desertification process, but based on business driven agenda, as variety of its schools and organizations fighting for the larger share of martial arts market (and they often see it as "zero summary game").
This is only one element of similarity (in development and historical dynamics) between modern and traditional martial arts. You can find other similarities yourself. Anyway, no modern martial art came out of "nowhere" as every one of them build on the foundation of one or several Traditional Martial Arts.