Why Israel Will Probably Never Have A Tech Giant And Why That’s Not Something To RegretDec. 8, 2015
For many years, Israelis used to lament that the local tech scene, while considered second only to Silicon Valley and generating many successful startups, has never been able to grow a world tech leader such as Nokia. Why don’t we have our own “Nokia?” people used to ask — while pointing a finger at entrepreneurs and investors alike.
Nokia has not been chosen accidentally. Originating in Finland, a country with a population of 5.4 million, it is an example that even small countries can grow a world tech leader. In its days of glory, Nokia was a global brand, had a market capitalization of €110 billion, employed tens of thousands of employees, operated in more than 150 countries and accounted for 16 percent of the Finnish export.
More than anything else, however, Nokia was a source of national pride to every Finnish person. Israelis, being very proud of their own tech ecosystem, were envious of the Finns for this achievement.
Economies are likewise more stable and robust when comprised of a wide and diverse set of companies. An economy that relies on a few giants, let alone a single one, is fragile. When such a giant collapses, it has a profound impact on the entire economy. Israel, being a small economy, would become more fragile if a real tech giant were to emerge, and, hence, is better off with a more diverse ecosystem without any giants.
The fact that Israel never generated a tech giant has, however, nothing to do with fragility. Fragility only explains why we shouldn’t regret it. The reasons it did not happen are quite different, and are related much more to the Israeli culture and the maturity of the Israeli tech ecosystem.
For the full TechCrunch article click here.