Israel might not have that many people, but it more than makes up for it in terms of startups. In fact, it has more startups per capita than any other country in the world and also ranks a very decent fifth in worldwide tech ecosystems. That means there are a lot of opportunities available for startups looking to find investment.
Today we’re going to discuss a few options.
Only five years ago, in 2011, Israel launched its very first startup accelerator. Do you know how many it has today? More than 200. That means there are a lot of choices and these are a great idea for your startup. After all, even if your company is still in a very early stage, these companies can offer funding, advice, facilities, mentorship and more.
The best thing, however, has to be that you only have to repay them if your startup succeeds. If it doesn’t then you don’t owe a dime. Now that’s a pretty sweet position to be in! The idea here is that the return of investment on a successful startup is so sizable that investors can write off the costs of those that fail.
What’s more, with so many choices there is a good chance that you’re going to find somebody out there that might actually be willing to invest in your model. Of course, it might take visiting more than 200 accelerators before you do, but that is the cost of doing business (or rather of getting an investment). So look for good reviews of companies. That way you’ll have a better idea of what’s going on there and which will be the best for you and your startup.
This is always an option, wherever you are, allowing you to put your idea straight to the people and see what they think. Many startups choose for crowdfunding because it allows them to maintain more control over their company and their product, with most people either selling off copies of their product, or other services associated with their startup, rather than offering up shares.
What’s more, crowdfunding also allows you to see directly whether your product has market appeal, with a successful crowdfunding effort suggesting that there is a real interest among consumers to buy your product.
That said, crowdfunding is a lot of work. You can’t put up a video on a crowdfunding site and hope for it to work. Instead, you have to push it, market it and advertise it every day it’s up. This can be exhausting if you’re already trying to run a full-fledged company.
If this is the way you’d like to go be sure to check out the crowdfunding platforms available in Israel to get a better idea of your options.
Office of the Chief Scientist
Startup Nation co-author Saul Singer calls the OCS the killer app of the Israeli startup scene. And well he might, as it provided 85% of the seed funding for startups. Now, it’s hard to apply directly to them for funds, but always be aware of what they’re doing and where they’re sticking their money.
What’s more, be certain to read their innovation reports, which can give you a good insight into where the problems currently lie in the Israeli investment sphere and where the government will be planning to invest time, effort and money in order to boost the sector. This might offer up opportunities to get funding, problems looking for solutions or other ways for startups to get ahead.
Some quick takeaways from the report to consider:
- There are not enough engineers in the country
- The government is working to bring back brains from overseas (with their owners attached, you’ll be happy to know).
- Life sciences need government intervention
- Industry outside the tech sector needs to work harder to embrace technology
No ability to go public in Israel
One thing Israel does not yet have, however, is an ability to go public within the country, which is something that startup owners should take note of. Instead, “Israel is considered the ‘Start-Up Nation’ but most Israeli tech companies get acquired by large global tech firms or go public abroad, especially on NYSE & Nasdaq,” Steven Schoenfeld, who is the founder and chief investment officer of BlueStar Global Investors, told Forbes magazine.
This means that if you’re going to start up a company in Israel with the intention of going public, from day one you’re going to have to look abroad for an opportunity to do so. So it’s a probably a good idea not to cut your ties with the US or Europe – not that that is every a good idea, but here is added ammunition for not deleting everybody off your social media when you leave.
The world is ever more interconnected, making it possible for you to start your business anywhere, be it America, Europe, or Israel. This means that you establish your startup where you feel the most at home and where you’ll have the most support.
That said, Israel has some unique opportunities that few other countries have. And so, you could do far worse than decide to establish your startup there.