Israel's newly rich techies arouse envy and emulation

Riskified CEO Eido Gal Photo: CRC Media

In focusing on the glamor and money, the media overlooks the 97% of startups that fail and the 24/7 efforts of those that succeed.

In their wonderful international bestseller Start Up Nation, researchers Dan Senor and Saul Singer attempt to examine the State of Israel from an overall perspective and analyze how it became, against all the odds, a global economic miracle. Israel has the highest number of patents per capita and the highest number of startups per capita in the world, with more Israeli companies traded on Nasdaq than European companies, and more.

Their conclusions are diverse but come back to the same point - there is something in Israel's cultural ecosystem that encourages entrepreneurship, independence, thinking outside of the box, innovation and more. The Israeli education system (with all our criticism of it), the youth movements (which focus on the Zionist and Jewish ethos), the army (a melting pot and fertile ground for innovation), the Israeli ego (everyone here is full of themselves and certain that they are God's gift to humanity), the fact that we are an 'island economy' (surrounded by enemy states) and so required to export products and services, and so on. There is something deep in our culture and the way we are raised, educated and live that always causes us to desire more (and if possible more than the neighbor would be good) and to aspire, to earn and influence as much as possible.

In effect, Senor and Singer say that all Israelis are entrepreneurs. All of us are creative. All of us think like high-techies. But all of us aren't high-techies in practice - and most of us don't enjoy the prosperity of the tech industry in our daily lives, and in particular not from the insane billions that have poured into companies and startups in 2020 and 2021. During the coronavirus crisis of all times, and the age of 'Zoom', when most of the world has been closed, Israeli companies and entrepreneurs have raised record and unprecedented amounts from investors and funds worldwide. One in 10 companies worth more than one billion dollars worldwide today is an Israeli company.

We are a small country of 9 million people, surrounded by enemies and fighting on several fronts at any given time, going through political crises and wars, with one of the most oppressive bureaucracies in the world, and still we make so much noise - most of it positive - and succeed in persuading so many serious bodies to invest money in us - $10.52 billion flooded into Israeli high-tech companies in 2020, the year of coronavirus, and so far in the first half of 2021, the record has already been broken and $11.9 billion has found itself in the pockets of Israeli high-tech entrepreneurs (and the government which is enjoying a crazy amount of tax and through it reducing the national deficit). The Israeli media has spotted what's going on and has been intensively featuring stories about the new people made wealthy by high tech (and is perhaps overdoing it). The glamorous side of things has mainly been highlighted - the festive launches on international stock exchanges, the indulgences awarded to high-tech employees, the amount of money circulating in this market, the lavish parties, and much more. Obviously, the 3% of success stories are covered and not the 97% of startups that close down within three years of being founded (and result in the loss of major amounts of money of investors and the time, money and energy wasted by the entrepreneurs themselves).

The positive image is growing

The question is what do all these stories do for the image and branding of Israel's high-techies. Does it reinforce the positive image of Israeli high-tech as the 'engine' of growth of the economy that carries the entire country on its back and brings lots of money into Israel (of which a large part is paid in taxes), a model for emulation that every schoolchild, soldier and student can strive for, or does it actually create a negative image of the aloof, arrogant, privileged and indulgent who are enveloped in their own bubble, only helping their friends, while most of the country is stifled by the Covid restrictions and looks at them enviously?

My feeling is that both are the case but with a clear tendency towards the positive image. The newly rich are our neighbors, our friends and the leaders of our communities. They are the ones who allow the country to cope with the economic challenges of Covid, and they create a positive image for Israel (a democratic, creative and liberal country) and they succeed in getting money from abroad (in justifiable amounts) and bringing it to the Holy Land.

What could strengthen the positive image? If the media would cover not only the high-tech successes but also the hours spent in the laboratory, the failures, the round the clock endeavor, the risks, and the significance of being one moment after the 'exit' to American ownership while providing answers and reports to demanding venture capital funds.

The author is an international expert in persuasion, marketing, sales, conveying messages and negotiations

Published by Globes, Israel business news - en.globes.co.il - on August 5, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

Riskified CEO Eido Gal Photo: CRC Media
Riskified CEO Eido Gal Photo: CRC Media
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018