Merger Propels Portland, Oregon – Israel Business

On the U.S. west coast, most Israelis know about Los Angeles, the Bay Area, and Silicon Valley.  Yet they will be surprised to learn about the exciting business with Israel being nurtured just north of California in Portland, Oregon.  At the center of this activity is the Oregon-Israel Business Alliance (OIBA), a membership-based not-for-profit that this past November announced a merger with the Technology Association of Oregon (TAO).

Why Portland?  A combination of niche corporations, growing Jewish community, emerging tech sector, and enlightened government is earning Portland the reputation as one of America’s most attractive cities for the coveted “Young and Restless” demographic.  According a recent New York Times article, the city has nearly all the perks that economists suggest lead to a high quality of life — coastlines, mountains, mild winters and summers, restaurants, cultural institutions and clean air.  “It’s really captured the zeitgeist of the age in a way that no other small city in America ever has,” says urban-affairs writer Aaron Renn.

A key catalyst in Portland is Noah Siegel.  Originally from Vancouver, British Columbia where his father was the Hillel rabbi, Noah grew up in New England before moving to Israel where he met his Boston-born wife.  He attended graduate school in Boston, and moved to Portland the first time in 1996.  After a few years in the Foreign Service as well as time at the State Department, the couple moved back to Portland in 2009 where Noah worked for the city’s mayor, handling international trade among other priorities.  A year later, he joined the staff of Metro Oregon, a regional government organization, where Noah is the internal political advisor working with the planners to enact public policy initiatives.

Siegel was a co-founder of the OIBA in 2010.  With their relatively small market, the group’s leadership last year felt that aligning with the region’s top tech business group would be a smart and strategic move—TAO handles administration and events while OIBA develops the connections and content.  Oregon is still considered “somewhat provincial” compared to the Bay area, Noah says, but is now seen as an interesting alternative with a great software and tech community.

The November merger announcement event in Portland was hosted by Jive Software that has an office in Israel.  The program speakers included Michal Miasnik of the BIRD Foundation that invested in a joint venture R&D project between Portland General Electric and E.B. Clean Energy to develop biomass torrefaction for the coal-fired power industry, and Ann Liebschutz of the US-Israel Science and Technology Foundation who was in town to activate the bilateral agreement signed by the Oregon governor and Israel Chief Scientist in 2010 during the governor’s mission to Israel that was organized with the assistance of OIBA.

Skip Newberry, executive director of the Technology Association of Oregon, is equally enthusiastic about the merger with OIBA.  He got to know Noah Siegel when they were both in the mayor’s office a few years ago, and also knew current OIBA president Steve (Rosie) Rosenberg of Aspen Capital and board member Diane Fraiman of Voyager Capital. Their common interests coalesced around an OIBA event in 2012 that featured Jon Medved of Jerusalem-based OurCrowd that subsequently funded Portland-based Lucid Energy, their first ever investment outside Israel.

“There’s huge potential for Oregon-Israel business cooperation given the explosion in talent of entrepreneurs and companies in Portland and Israel’s status as the Start Up Nation with an unmatched density of startups per capita of anywhere in the world.  Both sides need to get to know each other in a more intimate manner, and platforms like the Oregon–Israel Business Alliance can be a great mechanism for bringing innovation and entrepreneurship to this end,” says Medved.

Newberry points out that with Intel having a major development center in metro Portland that works closely with Intel Israel, there is an opportunity to collaborate on the Internet of Things and Cyber Security. TAO is working with local universities, and is very interested in Intel’s relationship with Technion as a role model.  Health IT and Education Tech are also considered prime areas for growth, and TAO has or is developing vertical interest groups for these sectors.

Israel is TAO’s first real international focus and offering to members. Skip feels that Israel is a great partner if you’re going international because of the talent pool, entrepreneurial culture, and capital / investor networks that can be a sweet spot for Portland companies.  “BIRD offers a great support mechanism for partnering with Israeli companies, and it is possible to work with Israelis on entering 3rd markets,” he adds.

Another trade mission to Israel is being considered, and OIBA’s Noah Siegel envisions inventorying existing Israel – Portland business relationships, activating members to get involved on behalf of Israeli companies seeking introductions, and organizing a delegation of Israeli companies to come to Portland, perhaps around Wearable Technologies, for Nike, Columbia, Adidas, Keen, and other companies in the Athletic & Outdoor industry sector in which the city is the world leader.  One of the existing relationships between Portland and Israel resulted from the 2009 purchase of Gibor Sports that turned Tel Aviv-based Delta Galil into a main supplier of socks to Nike.

FEI Company, a Portland-based manufacturer of diversified scientific instruments, is keen on the Israeli market for their electron and ion-beam microscopes and other instruments for nanoscale applications.  The company’s interests in Israel emerged from their 1997 merger with Philips Electron Optics whose Israeli business had been active for several years.  FEI’s Israeli market today consists of electronics companies, most prominently Intel in Haifa and Kiryat Gat, that are major customers, as well as Israeli scientific research institutions including Technion, Hebrew University, BGU, Bar Ilan, and Weizmann that have programs in material and life sciences.  As a result of this strong customer activity, just this week FEI opened a sales and service office in Israel located in the business park at Airport City, starting with 11 people including a country manager.  While open to the idea of doing R&D in Israel or acquiring Israeli companies with these capabilities, FEI has not done so yet; however, they do have a couple of Israeli suppliers for some of their equipment.

Rosalie Berne is FEI’s Senior Director of Global Business Operations who oversees the company’s Israel business.  A member of OIBA’s board, Rosalie is a Jewish mother whose son recently made aliyah and joined the IDF.  She says that the OIBA network was instrumental in finding the right person to be FEI’s Israel country manager.  She also enjoys making connections with others of like mind in Portland through OIBA, and appreciates its mission to promote business and investment with Israel, the only democracy in the Middle East.  Rosalie supports the merger of OIBA with Technology Association of Oregon as a move to make the organization stronger, and is happy to speak to other businesses in Portland about FEI’s positive experiences in Israel and her pride in their new Israel office.  “I am excited about FEI in Israel, and hope other Oregon companies will follow suit and invest there.”

Portland’s growing Jewish community is certainly a plus for the city’s ambition to be a major business portal for Israel. The local Jewish population almost doubled in 2011 from a previous estimate of 25,000 to a more accurate count of 47,500, a number that includes 700 to 1,000 Israelis according to Marc Blattner, president & CEO of the Jewish Federation of Greater Portland who points out that they participate little in the organized Jewish community, yet do come out in a strong way for the annual Yom HaZikaron program the Israeli community coordinates.  Marc notes that most of the Israelis work in Portland hi-tech companies.

With all this business activity, it is surprising that the local leaders are not aware of any Israeli companies that have set up their U.S. or regional operations in Portland.  However, the expectation is that if the Israeli companies can be driven to business relationships there, it won’t be long before they do find a home in Portland.  In fact, OIBA is currently working with an Israeli Health IT company that is evaluating the opportunities the community presents them.

A year ago, my own son joined the growing ranks of Millennials to move to Portland, and the unabashed enthusiasm for his adopted hometown is infectious.  I look forward to visiting Portland on a regular basis and seeing what I can do to help OIBA,TAO, Federation, and others in that Pacific community reach their great potential in nurturing Israeli business.