I’m a born and bred American who moved to Israel nearly nine years ago – for purely capitalistic reasons – to both receive my EMBA from the Kellogg School of Management’s partnership with Tel Aviv University and learn firsthand what it’s like to be involved with the global innovation ecosystem. Yes, I said global – not Israeli innovation ecosystem because in the past nine years it’s been my association with premier Israeli start-ups that has most captured the attention of international financial and strategic investors, technology giants and university students.
Seasoned executives in Hong Kong, Seoul, Singapore, New York, Russia and Silicon Valley are most impressed with the fortitude, resilience and innovation that emanates from the very fiber of Israel’s high tech society. Most multinational tech players have established key offices in all regions of Israel-for commercial, strategic and business impact. Companies such as Lockheed Martin in Beersheba, Intel in Haifa and Kiryat Gat (southern Israel), Google in Tel Aviv, SAP in Karmiel –Northern Israel and the list goes on and on.
Having just returned from NY and the Bay Area to the geopolitical reality that confronts Israel today, I read about the dire predictions from those in the US and Europe on whether the current political and military situation in Gaza will impact Israel’s long term business potential. And I feel compelled to convey certain facts.
First lesson we have learned is that adversity and tough mental and physical conditions produce stronger and successful companies. Throughout Israel’s young 66 year old history as an independent State, the country has witnessed and experienced wars, battles, confrontations, and terror attacks — each unpleasant to say the least, each disrupting to an extent a certain quality of family life
Yet, Israel has not only persevered but flourished. Indeed its tremendous success in the high-tech sector has yielded so many successful companies and M&A’s (one only need to look at NASDAQ traded companies) –that Israel has rightfully been referred to as the Second Silicon Valley or Start-up Nation.
Precisely because many of Israel’s high tech entrepreneurs are graduates of elite army units – which in turn breed accelerators to further spur commercial innovation they are called into reserve duty. They are then on the frontlines of both ground forces and intelligence units – when unease and dispute arises with its militant neighbors. Being drafted, dealing with warfare then returning to business deals and customers is part of what creates stronger and more durable – hence successful – entrepreneurs.
Israeli entrepreneurs have finely tuned the six elements of mental toughness described by Christine M. Riordan, Dean at the Daniels College of Business, University of Denver – key factors for highly successful athletes and business leaders. Flexibility. Responsiveness. Strength. Courage & Ethics. Resiliency. Sportsmanship. “ Game-ready leaders are able to exert and resist great force when under pressure and to keep going against insurmountable odds.”
In business terms, Israel’s economic and technology success in the competitive landscape among its ‘competitors’, e.g. neighboring countries, has far exceeded the size of its land mass and population. The Israeli society is built on creativity and perseverance. Creativity genius is matched with business prowess and continuous perseverance. This has resulted in many solutions to major problems confronting nations worldwide, in security, energy, agriculture, water and logistics.
Another catalyst has been the fact that Israel has had to be global from Day 1 of statehood. Israel lacks trade partners given the ‘island’ Israel lives on-surrounded by nations without diplomatic relations. Israel is a repeatable technology success story that can be scaled and repeated—Israel is an investment to bank on.
I am sure you’ve heard before how necessity is the mother of innovation. Israel, being the sole country in the Middle East without any real natural resources has been the harbinger, the hallmark of innovating in agrotech, water conservation and desalinization, and energy efficiency as well as smarter city solutions – because it has no choice.
Google, Intel, HP, IBM, Microsoft, Texas Instruments, and many other companies have established offices in Israel-employing thousands of Israelis-for a good reason. They know they have made an excellent investment in people and technology by establishing a serious presence here-many targeting Israel as its only global R&D center or new accelerator program.
In addition to Kellogg , other leading business schools have invested in Israel; Wharton established a seminar abroad with IDC (Herzliya private university) and Cornell recently created a partnership with the Technion (Israel’s ‘MIT’) and more.
In these times when the technology and business picture may be overshadowed by reports on CNN of the latest rockets and Iron Dome defense – also an Israeli innovation – one should reflect on the iconic words of Warren Buffet as he invested in Iscar, an Israeli company (2013).
Buffet cited in an article Israel is the “Most Promising Investment Hub. “The determination, motivation, intelligence and initiative of its people are remarkable and extraordinary. I’m a big believer in Israel’s economy…I didn’t invest the money in any other country. That’s the strongest vote of confidence I can give you, no?” he added.
So what are you waiting for? Urge all the US and European airlines to resume flights to Israel ASAP and see the technology miracle for yourself. Israel will continue to thrive – providing needed and extraordinary innovation to the world.
Esther Loewy is the CEO & Founder of Upround Ventures