The land of milk, honey, and innovation

In the third chapter of Exodus, God speaks to Moses at the burning bush and promises that He will bring the Israelites to “a good and special land, a land flowing with milk and honey.” Well, in modern-day Israel, it seems like this promise manifested as a land of innovation and startups.

Israel consistently ranks among the world’s most innovative countries and is considered one of the world’s top locations for entrepreneurs and venture capitalists. These rankings put Israel on par with some of the world’s biggest hubs of entrepreneurship and innovation including Silicon Valley, Tokyo, Singapore, Boston, Shanghai, New York, London, and Toronto. Given its small size and young economy, it is a surprise that Israel is able to fit itself into this list and claim the “Start-up Nation” title.

Israeli technologies have impacted millions of people around the world. Israel has substantially contributed to a wide array of sectors including nanotechnology (e.g. USB flash drives), media & internet (e.g. Waze GPS), security (e.g. Iron Dome air defense system), health & life sciences (e.g. PillCam endoscopy), Cleantech (e.g. solar water heating), and Agritech (e.g. Netafim: innovative drip and micro-irrigation products).

In my current position as an Innovation and Entrepreneurship courses director at MASHAV Carmel Training Center, MASHAV – Israel’s Agency for International Development Cooperation in the Ministry of Foreign Affairs, I have the opportunity to meet with entrepreneurs who come from all over the world to witness Israel’s innovation ecosystem. Everyone asks the same two questions: “What is the secret of Israel’s success?” and “How did it start?”

Israel’s innovative sectors are mainly the result of its numerous vulnerabilities. With almost no resources, lack of freshwater, large desert land, and continuous disputes between neighboring countries, Israel is left with the only option of investing heavily in innovation and maximize the intellectual capacity of its people.

Israeli innovation began long before the birth of modern-day Israel. In the early 19th century, brave young pioneers began to establish kibbutzim: communal, self-sustaining rural settlements through which members resolved community needs by developing innovative techniques for modern agriculture and industry. These kibbutzim quickly became a cornerstone of Israeli innovation.

Israeli innovation has come a long way since the first entrepreneurs met at Kibbutz more than a hundred years ago. Since then Israel’s innovation expanded to multiple tech industries. The fast growing Israeli hi-tech industry made Israel to be the leading contributor to human innovation.

The Israeli innovation ecosystem communicates the government, the academy, the private sector, and nonprofits. A key factor in the success of Israel’s innovation ecosystem is the strong bond which exists between its people. This bond which is strengthened through government programs, academic institutions, and the army service, fosters collaboration and the exchange of ideas.

Six main factors have contributed to Israel’s entrepreneurial success: government investment in entrepreneurial programs, immigration, investment in education, “chutzpah”, the Israeli army’s unique structure and nonprofit supporting programs.

Government Support System

The Israeli government encourages and supports entrepreneurs through its Innovation Authority, formerly known as the Office of the Chief Scientist. The Agency provides a variety of practical tools and funding platforms aimed at effectively addressing the dynamic and changing needs of the local and international innovation ecosystems. The Israeli government also makes a big effort to attract international technology companies which may wish to collaborate with Israel’s many talented engineers. These efforts have encouraged a large number of international companies such as Intel, IBM, Google, Facebook, Apple, Philips, to establish a research and development centers in Israel. Israel’s expenditure on R&D as a percentage of its GDP is one of the highest in the world.

Immigration

It is important to mention that immigration has also played a major role in Israeli innovation. The immigration of Jews from all corners of the world brought new skills and a new social structure to the country. In particular, the migration of over a million Russian Jews in the late 80s and the early 90s boosted Israel’s skilled manpower and innovation.

Education

Israel’s top educational institutions such as the Technion (Israel’s Institute of Technology), the Weizmann Institute of Science, The Hebrew University of Jerusalem, Ben-Gurion University of the Negev, the University of Haifa, and Tel Aviv University and other many more institutions have produced knowledgeable engineers, scientists, business leaders, professors and doctors that have lead spearheaded groundbreaking research initiatives in their respective fields. The success of Israel’s educational institutions can be demonstrated by the country’s twelve Nobel Prize winnings--a number that has placed Israel among the list of countries with the highest number of Nobel Prize winners per capita.

Israeli Chutzpah

Deeply rooted within Israeli culture is the concept of chutzpah. “Chutzpah,” best translated as “uninhibited audacity,” empowers Israelis to challenge authority, take risks, and be brutally honest--both with others and with themselves. Chutzpah can be good or bad; too much chutzpah, especially when it comes to cases of risk-taking, can sometimes result in major failures. Israeli’s are not afraid of failure, however. Because of their unrelenting chutzpah, Israelis will continue to try again and again until they succeed.

The Israeli Military

Since its establishment in 1948, the Israeli Army has continued to develop a cutting-edge technologies to strengthen its power. Aided by industrial grants from the government, some enterprising individuals began transferring defense innovations to civilian projects. Additionally, the Israeli army fosters an “entrepreneurial culture” by teaching young Israelis important skills such as teamwork, problem-solving, and improvisation.

Nonprofits

Many school systems and nonprofit organizations work toward supporting kids both in school and after school entrepreneurship programs. Such programs enable and support children in realizing their projects, ideas, and initiatives from an early stage. Leading entrepreneurs and businesspeople mentor teens as they found start-up companies and develop business ventures, while still in school.

In order to maintain its “Innovation Nation” title, Israel keeps expanding its support of the research and development sector. The Israeli Innovation Authority continues to strengthen its support for incubators and accelerator programs not only in big cities but also in the more peripheral areas of the country. The many news stories about successful of Israeli companies boost the morale of Israeli entrepreneurs and give them the courage to keep pushing forward.

The writer is the Course Director for Innovation and Entrepreneurship at MASHAV Carmel.