Where is the start up nation headed?Jan. 14, 2013
By Yoav Chelouch, IATI's Co-Chairman. Partner in Aviv Venture Capital and former president of Scitex.
Israel is praised as a world-class success story thanks to its high-tech industry. Israel's technology exports account for half of its industrial exports. This is a world record. The book, “Israel - The Startup Nation”, which tells the story of Israeli high tech, has sold more than seven million copies, and has been translated into 30 languages. Countries from all over the world send delegations to Israel to learn about the innovation, daring, chutzpah, and other characteristics of the Israeli entrepreneur.
They also diligently study and replicate the unique models for extended and successful collaboration between Israel's government and business-technology sector. This collaboration includes the activity of the Chief Scientist and the incubators, the Yozma program, which led to the establishment of venture capital funds (or maybe “venture chance”), and liberal policies for the commercial use of know-how developed in the defense establishment and the universities, and the tax breaks for foreign investors in Israeli high tech.
Despite the tremendous success, there are many clouds which portend real problems for continued growth. Financing sources for the industry are shrinking, and companies are struggling to raise capital. Start-ups are sold at early stages instead of creating big companies, which would bring stability and jobs. The manpower reserve is not just stagnating, it is liable to shrink as the engineers who came to the country in the waves of immigration from Russia retire. We have not yet dealt with the competition from China and India.
Growth of the innovation industry is critical for the continued growth of the Israeli economy. How can we do this?
The Israel Advanced Technology Industries (IATI) has drawn up a number of ideas the implementation of which should support further growth of the Israeli wonder story. IATI represents start-ups, medical devices and biotechnology companies, the development centers of multinationals such as IBM, Google, and Microsoft, Israeli and foreign venture capital funds, universities' technology transfer companies, incubators, technology accelerators, law and accounting firms, patent lawyers, international services companies, commercial and investment banks, and more.
For the full article in Globes.