Avigdor Willenz thought he could retire quietly. The billionaire responsible for exits of some of the biggest Israeli chip companies, sold to giants like Amazon, Intel, and Marvell Technology, moved his belongings to Switzerland, and settled in a picturesque cabin on an Alpine ridge overlooking the resort town of Gstaad. It is a small village of 2,000 inhabitants in the canton of Bern, far from the large urban and financial centers. Most people come here for the ski resort, with its hundreds of kilometers of ski slopes, or for the annual classical music festival.
Willenz, mentor to generations of chip engineers who are now leading Silicon Valley executives, was in search of respite from Israel’s hustle and bustle when he came to this isolated village. No shops, bank, or post office. For a little civilization, he walks about 20 minutes along a flowing river to the nearby town. By bike it only takes a few minutes. Five rounds of Israeli elections, the passage of a series of controversial laws, and the deterioration of Israeli political discourse, led him, he says, to head for the Alps in order to retire peacefully. But even here, sitting before a burning hearth or walking the snowy paths, Israel gives him no rest.
This is the man who brought giant technology multinationals such as Amazon, Marvell Technology and Carl Zeiss to the Galilee, rescued Tel Hai College from collapse, was one of the first residents in the northern community settlement of Kamon, and then lived in a modest house on Kibbutz Hanita. On one hand, exasperated, he announced he would make no more new investments in Israel, and would look overseas instead. On the other hand, two and a quarter years after moving to Switzerland, Willenz is tired of staying silent. He considered recusing himself from the Israeli public sphere, but given that his children and grandchildren live in the Israeli reality, following the recent government actions he agreed to be interviewed. Thus far, during his visits to Israel, Willenz has participated in five demonstrations, the last of which was the spontaneous march onto the Ayalon highway following the announcement of Minister of Defense Yoav Gallant’s dismissal (since withdrawn).
Swiss observer
"The longer you’re here (in Switzerland), the more you can see, close up, how systems can function well when they operate correctly," he tells "Globes" in his first interview since leaving Israel. "The Swiss government has only seven ministers, each minister holding a number of portfolios. The prime minister changes in rotation every year - and he is first among equals and most Swiss people don't even know who he is. There is no question of ego here. Decisions are decentralized and - apart from foreign and security issues and federal matters - are made by the cantons. Matters are conducted matter-of-factly for the benefit of the citizens." Willenz believes that the Swiss canton system may be the cure for the ills of Israel’s divided society, and the Israeli-Palestinian conflict.
His first impression was formed many years ago when he visited his older brother, a former Mossad agent, who worked on bringing Moroccan Jews to Israel in the early days of the state, and who has been living in Switzerland for over 50 years. Willenz recounts that he received three traffic tickets on his way from the airport. "I learned an important lesson: this is a country based on a system of rules that are clear to all, so much so that you can have confidence that no one will bother you. This doesn’t exist in Israel, which is why they try to optimize you. "
For Willenz, Switzerland is a country that respects its citizens. It is expensive, he admits, "But not much more expensive than Israel, and above all, a country that provides a dignified existence for all its inhabitants," he says. "The decision to emigrate to Switzerland was a process I contemplated for years, when you see what kind of country is developing before you, and where your tax money is going.
"The issues in Israel’s election campaigns are, to me, an absurd spectacle that has nothing to do with the proper conduct of a country, and divert attention from the truly important issues. Education, welfare, security, the economy, employment, and cost of living - all are overshadowed by fears and lies that crop up every morning. Instead of reducing national stress, they amplify it for political and personal gain, and don’t facilitate any substantive discourse. This mental stress and ongoing victimization have a deep cost for the society’s mental wellbeing."
Willenz lays out the list of ideas he has tried to cultivate in Israel down the years, some without success. He has been an active opponent of the occupation for many years, and was one of the most prominent donors to NGOs Breaking the Silence, B'Tselem, Adalah- The Legal Center for Arab Minority Rights, and Rabbis for Human Rights. He is a passionate environmental activist and is a major donor to the Open Landscape Institute, founded by the Society for the Protection of Nature, which deals with the preservation of open spaces in Israel, and also sat on the board of the Israel Union for Environmental Defense. Willenz took an active part in attempts at dialogue between Jews and Arabs and in creating bridges, partly through his support of the Tikva Foundation, and the establishment of the Darca network of schools in the periphery, (he departed following a dispute with the Rashi Foundation). He is also a major contributor to the New Israel Fund, which promotes many of the causes important to him. At the same time, he did not hesitate to support centrist political candidates: he supported Yair Lapid for a period of time, and helped Yifat Shasha-Biton enter politics in her race for the Kiryat Shmona municipality, before she moved into national politics.
Now, it appears as if his life’s work in Israel stands on a precipice. "The ongoing occupation, and control over another people, the Nation-State Law that makes Israeli Arabs second class citizens, quality of life in terms of concern for the underprivileged, our treatment of nature, open spaces and animals. The lack of compassion and tolerance for others," he laments. "All this under politicians who are busy with everything except taking care of facilitating and promoting a better life. In other words, this is a country that is moving away from basic moral, humane, and liberal values."
And Switzerland is your model for all this?
"My eldest son says: You have to choose which bureaucracy to live in. Transferring my life to another place is not something I enjoy, and I do so with great sadness. I hear from many Israelis who have left the country they love, that it is easier for them to live in a place they do not identify with emotionally. Even if Switzerland does something immoral, at least it's not something I feel responsible for." Willenz, whose family has roots in Austria with close ties to Switzerland, refuses to say what triggered his departure and offers a general statement: "When the state starts treating the private citizen like a bakery, and abuses those who pay taxes and work according to the rules, that is a major trigger."
"A government without management skills "
He remains an Israeli citizen and will pay taxes here for at least the next ten years, but has announced that he has stopped making new investments in Israel. In recent years, Willenz has invested independently in several Israeli startups, including proteanTecs, Wekaio, Lightbits Labs, DustPhotonics, Xsight Labs, and Quantum Machines. He says that, for two years now, he has not invested in Israel, but carefully chooses Israeli entrepreneurs who are active abroad: "The government is fighting the elites, and these days, this elite chooses to establish its companies in New York, Vancouver, and Berlin."
Willenz is estimated to be directly and indirectly responsible for billions of dollars in tax revenue. For several years, his personal tax payment was hundreds of millions of dollars per year, and in the tens of millions of dollars in other years. The investors behind Habana Labs, a portfolio company sold to Intel, paid at least $800 million in tax, while Galileo - which was sold to Marvell Technology immediately after the riots that led to the Second Intifada in 2000 - contributed an estimated $2 billion-plus dollars in tax on employee salaries during its time in Israel. "Paying taxes is, as far as I'm concerned, a value-based choice with a price I did not choose to pay. And when the entire ecosystem that you’ve created continues to pour a great deal of money into the economy, you become significant; instead of being an ant who supports the occupation, governmental corruption, and the abuse of minorities, you become a squirrel or even an elephant. These things drive you crazy."
The protest started with high-tech, an industry made up of mainly apolitical people.
"A brand like Israeli high-tech takes a long time to build and very little time to ruin. It's like taking a glass of clean water and putting a very small drop of iodine in it. It's no longer the same water; the color has changed and you can no longer drink it. In high-tech you see how potential investments immediately stop coming in when investors realize they won’t have the option to petition the court system to protect their property, or that business is deteriorating in ways that are impractical, unethical, immoral. Look at global high-tech: many engineers work not only for money, but for principles. Even in Israel, people will understand that what’s happening here doesn’t correspond with their values, and they’ll conclude that if they’re unable to correct the situation, they will leave."
So far, Netanyahu has made some progress.
"Look, I treat Netanyahu or the position of prime minister as the CEO of the country. When we, the investors, choose a manager for our companies, there are threshold conditions of morals in addition to professionalism or level of knowledge he is required to demonstrate. We look for extreme integrity, purity of character, transparency, a set of values in caring for employees, customers, or shareholders - that’s what I would demand from the prime minister, who is the CEO of the country: concern for citizens and residents. The problem is that with Bibi this does not exist. The complete opposite - he lies from all sides of his mouth, among his other flaws in terms of values. Another important feature of a good CEO is their ability to build an exceptional team. It’s clear that Netanyahu has built a team of problematic people in terms of values and abilities. On these two factors alone, he already does not pass any threshold conditions for management. Neither he nor any of his ministers would be accepted to any of my startups."
Not even Nir Barkat, one of the first investors in CheckPoint?
"There is a difference between an entrepreneur and an investor. Investors are not necessarily good managers, although it is possible that Barkat has good management skills. But when you look at the whole picture and see the abilities of most of the people working with Netanyahu - there’s no way that a commercial company would have succeeded with this sort of management team, and there’s no way the country won’t collapse or deteriorate drastically when it is being led in this way."
Authoritarian countries like the UAE raise money from western investors.
"There are many investors in the world and the question is who do you want to invest in you - the same murderer from Saudi Arabia who also invested in Credit Suisse or Amazon and Cisco? You can always find investors but the question is at what risk premium will they be willing to pay."
You mentioned the occupation and Breaking the Silence. That automatically turns off half our readers who might otherwise want to hear what you have to say.
"This organization has been threatened and has been made an enemy of the state. Set a target and immediately everyone jumps on it. This is simply an NGO that tries to bring the truth to the public consciousness, in its case, about what is happening in the occupied territories. Our fear of the truth and dealing with a real problem, and our lack of recognition that we are wrong, weakens us and, ultimately leads to failure. Israeli organizations condemn and criticize them as enemies of the state but Breaking the Silence, B'Tselem, Adalah - they are the ones who help build real resilience, they bring the truth to light. The longer we ignore reality and truth, and live a lie, the more our problem as a whole will continue to grow."
The argument made about Breaking the Silence has also been put to today’s high-tech protest leaders: air your dirty laundry at home, not before the world.
"In our world, everyone knows everything, and it is better for the truth to come from an organization like Breaking the Silence accurately and correctly than in a roundabout way. When you have arteriosclerosis, if an artery is blocked, sub-arteries develop that perpetuate the problem. Do you think the world can’t see? Let's not act like ostriches thinking, if I bury my head in the sand, I can’t be seen.
"The same goes for high-tech: the managers and companies that transfer money and employees abroad are committed first and foremost to their shareholders, employees, and customers. If the State of Israel decides that LGBT people don’t have rights, or that property can’t be protected because there is no legal system to protect it from arbitrary governmental decisions, then they have a duty to warn about the outcomes of the judicial revolution."
How a religious boy from Jerusalem became a one-man VC fund
There’s no other way to put it: You are privileged, a billionaire, an armchair critic seated in the Swiss Alps. Don't you think that weakens your arguments?
"Both the privileged and the billionaires are allowed to express an opinion and to criticize. It is usually helpful, although no one has to accept or listen to an opinion or criticism. Some segments of Israeli society are afraid of hearing opinions that are different from the official narrative, or are critical.
"It is not clear to me what this concept of privilege means. Is it someone who hasn’t seen hardship in life? Where everything comes easily? Someone associated with a group that controls resources? That’s the definition of privilege? Do you put a person in this category based on their outcome and not their journey? A privileged person can, after all, come from any ethnic group and from any town. My daughter served in an intelligence unit, where the most prominent soldier with the highest grades came from [development town] Shlomi. Does that make him a privileged person?
"So, they say that I’m privileged, but what exactly is that? I’m a leftist, not privileged, and I’m not ashamed about it. Unfortunately, ‘leftist’ has become a dirty word. But what is a leftist? Someone who works for the common good, who believes there should be a safety net for the weak in society, who thinks that society should be ethical, treat animals properly, not sell weapons to shady regimes, someone who believes that the people who lead the country should be ethical, that the state should treat everyone equally, on a ‘live and let live’ basis, where everyone can express their opinion, and demonstrate without being termed an anarchist."
Willenz's childhood is light years away from the image of a high-tech billionaire living comfortably in the Galilee. He was born in Rehovot to parents who arrived in Israel with nothing. At the age of two, the family moved to Jerusalem’s Kiryat Moshe neighborhood, which centers on the Mercaz HaRav yeshiva, one of the largest Torah study centers in Israel. Up until 8th grad, he attended a religious school, wore a kippah (skullcap) and tzizit (ritual fringes), put on tefillin (phylacteries) every morning, and slept in the same room as his grandmother. As a child, around the Sukkot holiday, he sold etrogs in the Mahane Yehuda open market to help the family. After his father opened a building materials store, he worked there while continuing his studies. Before entering high school, he debated whether to study at the Netiv Meir Yeshiva in the nearby Bayit Vegan neighborhood, or at the Hebrew University High School, commonly known as 'Leyada, which had a more secular population.
The choice to go to 'Leyada, motivated by a desire to obtain a universal education, ultimately led to giving up the tefillin and kippah. Willenz found himself in class with the children of professors from the well-off Rehavia and Old Katamon neighborhoods. "Our studies combined humanities and sciences, physics and math along with history, literature and Jewish thought , and above all we had amazing teachers. I absorbed Western culture, liberal values, and Jewish consciousness," he says.
But the real privilege, he says, was growing up as a teenager in Jerusalem of the 1960s. "I wasn’t raised in a family of professors, but all around us was a whole system of Gadna [pre-military] youth clubs for avionics, shooting… the Tikvatenu precision mechanics club. We built airplanes out of balsa wood, we studied physics, our lives were rich with frameworks that advanced us greatly."
He then joined a group of 20 volunteers for a year of pre-army service with Garin Re'im, an experimental framework for urban youths to work in development towns that has since become a success. Re’im had volunteers in the towns of Kiryat Malachi, Beit Shemesh, Mitzpe Ramon and Yeruham, which is where Willenz spent a year of his life. At the same time, he was also involved in establishing gap-year volunteer frameworks in Arab communities like Deir Hana and Arraba. After that, he enlisted in the IDF Armored Corps, serving in Sinai after the Yom Kippur War. In the First Lebanon War, he served as deputy commander of a tank company in the 362nd Battalion, including during the Battle of Sultan Yacoub, where many were killed, and two soldiers, Yehuda Katz and Zvi Feldman, still remain missing in action.
You belong to the generation between the Yom Kippur war and Lebanon. The current social rift is often compared to the one that happened during the Lebanon War, or to the lack of trust between the government and the citizens during the Yom Kippur War.
"During the Yom Kippur War, the threat was external, therefore in the first stage there was full mobilization and agreement between the government and the citizens. In its aftermath, the public was not willing to make concessions unless a thorough investigation was conducted. The Lebanon War was a war of choice. Therefore, and rightly so, there was opposition to going to war. Debate and disagreement were conducted within the civil framework, without changing the basis upon which the state exists. The government and Knesset’s current actions are an attack that is attempting to dismantle consensual values according to which the citizens conduct themselves. This is a process of national suicide."
Following his demobilization from the IDF with the rank of Armored Corps Officer, Willenz enrolled in electrical engineering studies at Technion - Israel Institute of Technology. After completing his studies, he began working at Elbit in computer infrastructure development for the IAI Lavi and F-16 aircraft. At that time, the early 1980s, the Willenz family decided to join the second wave of settlers to Kamon, living in a trailer when the community, he says, had only one generator and one telephone line.
Then began the high-tech career that made Willenz godfather of the Galilee chip industry. In 1988, he went to IDT in California as a semiconductor developer, eventually becoming chief architect. He returned to the Galilee and founded Galileo Technology, in cooperation with the American company who put their faith in his ability to launch an initial pilot in Karmiel. In 1997, he took Galileo public on Nasdaq, and in October 2000, during the Second Intifada, sold it to chip giant Marvell Technology for $2.7 billion in a share deal.
Over 20 years, Willenz has sold semiconductor startups such as Habana Labs, Annapurna Labs, Pixer Technology, and Leaba Semiconductor, to giants such as Intel, Amazon, Carl Zeiss, and Cisco for over $3 billion. In his career, Willenz has combined expertise and attention to detail, a highly developed commercial sense that understands the technology giants’ most pressing needs, a familiarity with elite entrepreneurs, a unique investment model that has turned him into a one-man venture capital fund, and an extraordinary charisma that has allowed him to manage complex sales dealings with senior Silicon Valley executives.
You were known as "Mr. Galilee" - one of the founders of Mitzpe Kamon, an entrepreneur who always set up his startups in the north, and contributed significantly to employment for periphery residents. You lived in a relatively modest house in Kibbutz Hanita. What happened?
"It’s true that my first companies were established in Karmiel and Haifa, and indeed, I always tried to build companies in the periphery first of all. But in recent years, we moved southwards and set up Banias Labs in Tel Aviv. Another company, Xsight Labs, operates out of Kiryat Gat. But I have entrepreneurs today who operate in Canada and Silicon Valley. All in all, you go where the entrepreneurs are.
"I belong to the generation that had the State of Israel in its DNA, that was raised with the ethos of building the Land of Israel, which incorporates the idea of settling the Galilee and building a wide-ranging industry there. That's what I was raised on, which is why the experience of dream and devastation is so huge for my generation. We went through its construction and now its total destruction - and it's so tragic."
"The Amazon exec who couldn’t rent a place in Haifa"
One reason why Willenz takes the Nation-State Law so personally is the long-standing partnerships he has led with entrepreneurs and engineers from the Arab population. Through the Technion alumni network, he got to know Israeli Arabs who changed the technology sector significantly. There is Asad Khamisy, who graduated with honors in computer science and has been at Broadcom for 20 years, currently as VP of R&D in Core Switch Products, and Willenz’s co-founder at Annapurna Labs Nafea Bshara, now VP and distinguished engineer at AWS.
Born in the village of Tarshiha, Bshara was a Technion student when Professor Yitzhak (Tsahi) Birk connected him with Eyal Waldman, who in those days was a senior executive at Galileo, the Karmiel-based start-up Willenz founded. "I suggest you grab him and think about what to do with him afterwards," Birk wrote. Waldman took the recommendation and made Bshara a partner in the sale of Galileo to chip giant Marvell Technology in what became the first multi-billion dollar exit in Israel. The company was sold in 2000 for more than $2.7 billion in stock. Waldman did not stay till the end. He left the company due to differences of opinion without profiting from the exit, but the company he founded afterwards, Mellanox, became a success story in itself. Bshara was appointed Marvell's CTO, working with customers in the US.
When Bshara wanted to establish his start-up, Annapurna Labs, together with partners Bilic Hrvoje, Ronen Boneh, and Manuel Alba, he consulted Willenz. That consultation brought the latter in as the fifth partner of a company that became an Israeli success story. To this day, Annapurna Labs - with offices in Haifa, Yokneam and Tel Aviv - is responsible for the development of Amazon server chips that have saved AWS an estimated $5 billion in costs, compared with competing products from Intel or NVIDIA.
"Imagine a person with skills like Nafea Bshara being unable to rent an apartment just because of his accent. And he was the student with the highest scores in his field of study at Technion. But for engineers like Bshara, Asad Khamisy of Broadcom, or Johny Srouji, senior VP of Hardware Technologies at Apple, relocating abroad is not just because of being Arab-Israeli. It’s just one more factor that brings people to leave their country. There are at least another 1,000 Arab-Israeli workers who have left for Silicon Valley. That’s a worrying brain drain. It only demonstrates the tremendous potential of this population and the prejudice some of the Israeli public have against them. The Nation-State Law enacted in 2018 is a particular example of this absurdity. This law tells Arab citizens: you are all second class. So, it's clear that any Arab-Israeli who considers themselves talented will look outwards."
What keeps you optimistic?
"I think the protests will be successful in the medium and long term. This government appears to be weak, divided, and on shaky ground. I think it will fall apart and I believe that the general public, especially the young people, will take responsibility for their fate on the political level as well. Perhaps a new civil agreement will be written to redistribute the economic and security burdens. If the territory between the River Jordan and the Mediterranean Sea can be divided into cantons, it would offer every segment of population self-determination."
Your friends in the high-tech industry are leading the anti-judicial reform protests and they’re doing it from Israel. Protesting from a distance is less effective.
"There are significant protests taking place in Israel, and I think that’s wonderful. I attended five demonstrations and was very moved that such a large public, mainly young people, is fighting for its principles and its future, and all without violence. People like me, from high-tech, also help financially with funding, which, by the way, is relatively very low. It comes from people like me and not from George Soros - whom I greatly admire - or from other anonymous sources. There are quite a few people of means within Israeli society who care."
You have three children, three grandchildren, and two other daughters whom you raised together with your ex-partner. Moving to another country certainly involves moving away from your family.
"All my children and grandchildren live in Israel, from Kibbutz Hanita to Tel Aviv. That’s why it is important to all of us that the nation will emerge from the crisis, perhaps even stronger and with a completely different agenda. I miss my family very much, I am an exile by choice, and it is very painful. I would happily spend all my days in Israel and pay my taxes there and there alone, but I’m not prepared for them to finance the occupation and the judicial reform. Paying taxes is a value-based choice that comes at a price."
You mentioned the younger generation taking flight. Its easiest and most natural for them to follow in their grandfather's footsteps.
"My children grew up in Israel but also lived in the US for periods of time. They decide by themselves where to live, and I have no influence over that. Everyone discovers the many advantages of living in Israel, in terms of friends, family, employment, love of the country, the Israeli character and culture - meaning the warm, open, liberal culture. I assume that they won’t will live here under every circumstance, not if things become intolerable. But some of my other ‘children’ - the CEOs I raised at the companies I co-founded - are considering leaving for other places, and starting their next companies elsewhere."
Published by Globes, Israel business news - en.globes.co.il - on April 17, 2023.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.