How Israel turned itself into a high-tech hub

Israel's rise as a tech hub has quite a few similarities to Silicon Valley's early history. Having good schools and a frontier spirit seem like key ingredients. Perhaps most important is the involvement of military spending in seeding research which leads to new technologies, which in turn spin off from their government-funded roots and form new private companies, which then seed other new companies, venture capitalists move in, more companies are seeded, the cycle continues. Another 50 years and continued military support from the US, and Israel will surely be an excellent complement to the valley.

The conversation is around whether and how Israel became a high-tech hub. Please let's keep politics out of it.

This article is pretty poor. I had the opportunity to attend a presentation from Professor Shmuel Ellis, from Tel-Aviv University, where he discusses exactly about this, how Israel turned itself into a high-tech hub. In his research, he could trace the growth of this entrepreneurial culture to a few things. Now, I won't remember all of his words and reasoning, but I do remember some of it and my own takeaways from the talk.<p>First of all, Israel is a country that went through alot of challenges right after it was formed. Its population doubled in less than 5 years (due to imigration), so there were big problems in building the infrastructure to support this tremendous growth in such short timeframe, which required extreme levels of coordination and a wide set of skills to make this possible. This challenging start, with the imigration of very capable and educated people (many of which had a science background), alongside with the Israeli tradition of debating and questioning (which can be seen even inside Israel's army, according the the talker), led to strong learning, generation of ideas and knowledge. This culture with the funding jump-start from the government gave birth to the first few technology companies in the country.<p>Later on, government support, influx of new, capable and educated work-force (Israeli families value good education and Israel has some of the best education institutions) and the beginning of the first Israeli VC companies (many of which were funded by imigrants from the U.S., where they acquired the expertise by working in this industry) set a very favorable environment to entrepreneurship. But this wasn't just it, Professor Shmuel Ellis then introduces his research in the genealogy of Israel's tech companies, and manages to show how the first technology companies in the country gave origin to hundreds of new start-ups that were formed either by the parent's company founders, its employees or a mix of both. It wasn't just the environment culture that was favorable to being an entrepreneur, but these companies themselves inspired their own employees to also have an entrepreneurial posture and estimulated the creation of new companies. His genealogy graphs are amazing and I fortunately found some of them here (ppt - slide 22 on): <a href="http://www.leadership.umn.edu/news/ppt/Droripowerpoint.ppt" rel="nofollow">http://www.leadership.umn.edu/news/ppt/Droripowerpoint.ppt</a><p>Anyway, according to this (<a href="http://recanati.tau.ac.il/_Uploads/Personnel/cvellis-March2010.pdf" rel="nofollow">http://recanati.tau.ac.il/_Uploads/Personnel/cvellis-March20...</a>) his research on this subject is still in progress, but he already gives alot of insights in his talks.

"Another example is Boxee. The five Israeli founders decided from the get-go to headquarter the company in Delaware in the United States, but locate the company's research and development office in Tel Aviv."<p>How many other "Israeli startups" are registered as US businesses and pay tax to the US government, let alone sell-out to US corporations, and funded by non-Israeli sources?<p>Israeli entrepreneurs? Yes. Israeli startups? hmm.

had to check the comments to see how quickly this would get off topic. this is tech news. it's getting as ridiculous as slashdot around here.

Ashkenazi Jews comprise a significant fraction of the population of Israel, and they are a rather intellectually fecund group. Ashkenazim earned roughly a quarter of Nobel prizes, Fields medals, ACM Turing awards, and over 60% of John Bates Clark medals, and account for roughly a quarter of Ivy League students.<p>Those figures above come from a population where Ashkenazi Jews comprise 2% of the population. They constitute at least 10x as much of the population proportionally, in Israel. (It's hard to get an exact figure due to admixture between Ashkenazi and non-Ashkenazi Jews.)<p>Having an abundance of such people, relative to America, has surely helped. The specific circumstances surrounding Israel and its birth help to channel its brightest people into startups and technology, and less into law, finance and policy, as in America.

Israel has extreme human rights issues they need to deal with before I'll consider doing business with them. The Israeli government insists on continuing to settle its citizens onto Palestinian territory, driving local Palestinians off their land. As long as settlements continue, businesses should not look to Israel as a country to work with.

Guys look at this. I was about to same as CQ, <a href="http://www.haaretz.com/news/national/prominent-israeli-rabbi-faces-criminal-probe-over-anti-arab-remarks-1.397057" rel="nofollow">http://www.haaretz.com/news/national/prominent-israeli-rabbi...</a><p>Things are about to get so hot over there. This is very big news. This could be the thing that sets everything off.