Spirit of innovation drives Israel’s start-up story  

Jaffa shows its age, all 4,000-odd years of it, but alive and buzzing as ever.
Tel Aviv ranks among the top start-up ecosystems around the globe, other Israeli cities have their own innovation-driven networks
Tel Aviv ranks among the top start-up ecosystems around the globe, other Israeli cities have their own innovation-driven networks

CHENNAI : Jaffa shows its age, all 4,000-odd years of it, but alive and buzzing as ever. The ancient port town, whose history goes beyond its biblical association, is where past meets present, in contrast to the jazzy metropolis it overlooks — Tel Aviv, a showpiece of modern Israel where present truly meets future. The two neighbourhoods, different from each other, represent today’s Israel, where the ancient and the modern coexist in complete harmony.

The setting and the perspective remain the same wherever you go in Israel, only the narrative differs slightly — be it Nazareth, Haifa, Jerusalem or any other city. While innovation and entrepreneurship are at the heart of Israel’s development and progress, its foundation lies in the history of its lands and people. 

That the country is betting big on its people’s potential to innovate and create is shown in the number of successful entrepreneurs it has produced. While Tel Aviv ranks among the top start-up ecosystems around the globe, other Israeli cities have their own innovation-driven entrepreneurial networks. For example, the Nazareth Business Incubator Center, with its headquarters offering a magnificent view of the biblical city and the history it holds, focuses on the entrepreneurship among the country’s sizeable Arab population and nurtures Arab-Israeli start-ups.

Haifa-based Technion, Israel’s premier technology institute, has played a crucial role in establishing the country as a hub of innovation, not just by producing the required technical talent pool but also by churning out many entrepreneurs.

There is innovation at every level, across the nation and population. WMN, a community that provides the ecosystem for women-led ventures, has a network of 22 female founders of companies spanning sectors such as cybersecurity to dating to e-commerce.

Even other Israeli universities are part of the start-up ecosystem, by being facilitators and incubators. Lightricks is a start-up that was founded on the Hebrew University’s campus in Jerusalem, and is known for popular photo and video apps like Facetune, Photofox, Quickshot and Videoleap. Then there are initiatives like OurCrowd that facilitate investments in start-ups at an early stage through equity crowdfunding.

According to Ran Natanzon, head of innovation and brand management at Israeli ministry of foreign affairs, the country currently has about 7,700 start-ups, 360 venture capital funds and 330 R&D centres. Israel is said to be investing 4.3% of its GDP in R&D, the highest among all countries. The efficient start-up ecosystem is supported by government, venture capitalists, and banks on the availability of a rich pool of technical and management expertise. 

Israelis say their culture of innovation stems from their instinct for survival. Lacking natural resources and surrounded by hostile territories, innovation was Israel’s only path to survival and move up. “Israel is a state that’s created from our brain power. Everything we achieved is through innovation,” said Chemi Peres, son of Nobel-winning former Israeli President Shimon Peres. Chemi Peres, a venture capitalist himself, heads the Peres Centre for Peace and Innovation named after his father.

Israel’s need for innovation was best summed up by PM Benjamin Netanyahu when he said how the future belongs to those who innovate. “Innovation is not just an engine of progress, it’s also an engine of peace. Quite a few neighbouring countries are reaching out to Israel and normalising relations with us because of our innovation. They want our innovation not merely for security reasons but also for civilian reasons,” he said at the Prime Minister’s Innovation Summit in Tel Aviv on October 25. 

The contrast between the two sides of Israel is starker in Jerusalem. The modern part can be compared to the most modern of global cities, but passing through one of the gates of the Old City’s walls is like entering a time machine that can literally take you back hundreds of years in a moment. Significantly, both parts of the city are rich — one in history and the other in entrepreneurial spirit.

(The author was in Israel to attend Prime Minister’s Innovation Summit)

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