Five reasons Israel should be on your global destinations list
If your knowledge of Israel is largely gleaned from newspaper headlines, you could be missing out on the many insights that can be gathered from a closer examination of the country’s unique business ecosystem.
Israel is by turns fascinating and controversial, but most MBAs will be particularly impressed by the energy, innovation and entrepreneurship they encounter at every level of the economy. We’ve listed our top five reasons for putting this exciting and evolving country at the top of your must-visit destinations list!
1. IT’S BEEN DUBBED THE START-UP NATION
Perhaps surprisingly, Israel has the highest number of start-ups per capita of any country. Despite having a population of just eight-and-a-half million people, Israel has more venture capital, start-ups and tech professionals than any other country in the world (Forbes) – 4750 in 2016, according to Dun and Bradstreet.
There’s no single factor responsible for this level of start-up success, rather that a combination of an entrepreneurial mindset, a determined self-reliance and early contact with technology – thanks to widespread citizen participation in the military service – come together to drive innovation. This commitment to finding solutions is particularly prevalent among young people and is supported by dozens of funded programs, as well as by private venture capital.
2. IT’S ALSO TECH CENTRAL
Just outside Tel Aviv lies Silicon Wadi – a region analogous to Silicon Valley in the US and one that attracts high-tech industries built around military, start-up and venture-capital communities. International tech giants like IBM, Google, Facebook and Oracle already have a presence and are collaborating with home-grown Israeli businesses to enhance their innovation, and R&D strategies.
Intel recently acquired Mobileye, a pioneer in the driverless car technology industry, for an eye-watering $15.3 billion - the biggest tech deal in Israeli history. Intel is a long-term supporter of the tech sector in Israel, currently exporting around $4 billion of products annually from the country and employing more than 10,000 staff.
3. FINTECH IS RIDING HIGH
Israel’s FinTech roster stretches from pioneers like Payoneer and eToro, to newer companies like FeeX and Lemonade. According to Tel Aviv’s FinTech start-up hub The Floor, there are 500 Israeli FinTech companies raking in $650 million in venture capital for the sector. Leading institutions such as Citibank and Barclays are already exploiting FinTech opportunities, with the creation of innovation labs and accelerators.
However, it’s cryptocurrencies that are hitting the headlines at the moment: Bitcoin and Ethereum are enjoying brisk trade and there’s a rapidly developing ecosystem that’s fully exploiting blockchain technology to release Initial Coin Offerings (ICOs) at record rates. Israel-based Bancor recently raised an impressive $150 millionin just a couple of hours for its smart-contract-based token conversion standard.
4. YOU CAN LEARN A LOT ABOUT VENTURE CAPITAL…
Israel’s emergence as a boom economy can probably be traced back to a series of government tax cuts in the mid-1980s which were designed to kickstart what was then a stagnant national economy. A software boom at around the same time that helped to forge Israel’s reputation for technological innovation. Subsequently, the government initiative Yozma– offering tax incentives to investors and entrepreneurs – single-handedly established Israel’s now-thriving venture-capital sector.
The IVC Research Centre in Tel Aviv reports that Israeli high-tech companies raised $4.8 billion in 2016, with a financing round average of $7.2 million. Japanese and Chinese investors are now joining US and European counterparts as they target Israeli ingenuity.
5. …AND ABOUT CYBERSECURITY
Israel punches way above its weight in the cybersecurity sector. Focused on foiling the increasingly sophisticated attempts of hackers to hold organisations to ransom, it’s an industry that’s has a vital part to play on a global stage and it’s a sector in which Israeli start-ups are leading innovation: Tel Aviv-based Check Point is currently the world’s largest cybersecurity company.
Dozens of cybersecurity start-ups are founded every year in Israel, with the latest figures showing a shift in funding towards later stage companies, indicating a rapidly maturing market. Second only to the US in terms of investment, Israel breaks fundraising records each year.
Israel’s unique culture and burgeoning business ecosystem can only be fully appreciated by visiting – so, what are you waiting for?