Israel’s Hi-Tech Industry: The Beginnings

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Israel is today one of the hi-tech leaders of the world. This industry has mushroomed over the past twenty years or so with some of the world’s leading technology companies joining Israel’s own start-ups in utilizing the skills of Israel’s population and establishing research and development centers in the country. Whilst the story of Israel’s hi-tech industry is long and tumultuous, this background will be useful for anyone planning a business trip to Israel and curious about how this little country ended up with such a big place on the global technology map!

Here are six key factors in the development of Israel’s hi-tech industry

  1. Israel has lack of natural resources – it has had to use the only resources it has, its people. With a population originating from around the world, Israel has an incredibly diverse population which was enhanced greatly in the 1990’s with a wave of skilled immigrants from the former USSR.
  2. Even before Israel was created as a State in 1948, the country had a number of leading academic institutions. Today, two Israeli universities, the Hebrew University and Tel Aviv University are continually ranked among the best 100 in the world, whilst the Weizmann Institute of Science is considered the best university in the world to be a researcher!
  3. Through the wars which have shaped Israel’s history as a nation, great knowledge and skills have been developed by the country’s army. Many originally military technologies have been transferred into products. For instance, the pill cam created by Given Images and used by patients around the world is actually adapted from the camera on the head of a missile!
  4. A culture of innovation is what separates Israel from the rest of the Western World. Israelis solve problems without fear of failure and as a result the country has more start-ups per capita than anywhere else on earth, more Venture Capital funding than the whole of Europe, more Nasdaq listed firms than any other country outside North America, and more patents registered per capita than anywhere else in the world!
  5. Strong support for start-up companies and great links between the private sector and academic and public sector mean that technologies developed in labs are converted into products and quickly bought up by big technology companies from around the world.
  6. And something in the air… There is something of a buzz and fascination among Israelis in developing new things that doesn’t exist elsewhere. Somoto, a Tel Aviv hi-tech firm whose product is called the Somoto Toolbar said “there’s a buzz in the air in Tel Aviv – it isn’t like other cities, the air is full of creativity.”

The result is that you drive along any major highway in Israel and see buildings sporting the signage of so many hi-tech companies. From Google, Cisco, Intel, Microsoft, and Apple, to major hi-tech companies you may never have heard of such as CheckPoint, Teva, Amdocs, Comverse, and NICE Systems, to start-ups which might soon be household names, or otherwise will be likely bought up by major hi-tech firms. Some of Israel’s hottest start-ups at the moment are Waze (a free gps and social traffic mapping app), (which automatically recognises faces for the purpose of social network imaging), Boxee (who created a great way to watch internet programming on your tv), Somoto (who created the Somoto Toolbar which is used by software developers to enhance user interaction), Wibiya (who have a social toolbar you probably didn’t know they made but will almost certain recognise from many websites you use!)


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