Israel is quickly becoming an innovation giant. With just over 7.7 million people, Israel has an estimated 4,800 startups, many of them high tech. These companies are sources of groundbreaking innovation that is catapulting Israel to global tech prominence. The combination of Israel’s culture, environment and keen strategy has led to a tech boom that rivals Silicon Valley.
It’s not only the sheer number of entrepreneurial companies; it’s their astonishing, innovative edge.
One of the most popular and widely known Israeli tech startups is Waze, a mobile phone traffic and navigation app that’s creating a “driving community,” and is used by nearly 50 million drivers worldwide. Waze has been so successful that it was recently acquired by Google. OrCam is a startup that has developed technology that allows blind people with intact optic nerves to see. Phinergy has created a lithium car battery that triples mileage for electric cars. These are just a few examples of thousands of startups that are making Israel a “startup nation.”
Israel’s tech boom is good for Israel and for the global economy. The Tel Aviv Stock Exchange lists 616 companies, meaning Israel has one public company for every 12,500 citizens. By comparison, the U.S. has one public company for every 47,000 people. Israeli companies’ continued success is a model for the rest of the world, and a tribute to their enduring spirit in the face of significant challenges.
Israel is a flourishing high-tech hub in an increasingly inhospitable region. Yet the country is surprisingly self-reliant. At an October 7 Tel Aviv event promoting the International CES®, I moderated a panel of leading Israeli innovators. The discussion revolved around why Israelis are so entrepreneurial. The panelists’ responses revealed that Israeli tech prowess comes from a combination of intelligence, creativity, productivity and independence as well as their staunch determination to press on in the face of daunting opposition.
The panelists praised Israel’s education system. Dr. Yoelle Maarek, head of Yahoo! Labs Israel, said Israeli education is excellent, largely because the students participate actively. She compared her experiences teaching in France, the U.S. and Israel, and said Israeli students are the most eager to learn.
Others point out the mandatory military service most young Israelis are required to fulfill when they turn 18 as a driver of high achievement. Dr. Maarek and another panelist, Dov Moran, inventor of the USB flash drive, said that military service, combined with the continuous external threats to Israel, cultivate a seriousness of purpose and a cultural willingness to accept economic risks. Creating a new business may seem relatively tame when neighboring countries are hostile to your physical survival. Besides this, Israel’s investments in defense technology and commercial products spun off from defense technology have encouraged – and even required – ongoing innovation.
More, Israel is an immigrant and multicultural nation, allowing for diversity and different viewpoints, as Google Israel Managing Director Meir Brand and other panelists pointed out. This allows for creativity and innovation, by encouraging the free flow of ideas and collaboration among individuals with very different perspectives. In many ways, Israel’s strong innovation culture runs parallel to America’s. Both countries share the unique view that entrepreneurial failure is an education rather than a badge of dishonor. They don’t punish risk-taking the way many other nations do.
The entrepreneurial spirit in Israel may start early in life, too, with a strong family dynamic. Panelist Dr. Yossi Vardi, involved in more than 70 startups and credited with fathering instant messaging, charmed the audience with his tribute to the “Jewish mother.” Israeli parents, but especially mothers, both assume and demand success from their children, thus setting a high bar that encourages young people to work hard.
Together, all these things explain Israel’s success and paint a mosaic of a nation whose very struggle for survival has spurred its innovative spirit. Israel’s successes show how culture, environment and strategy can create centers of innovation. Israel’s success is an inspiration with international ramifications that benefit all people across the globe.