יום שבת, 15 בפברואר 2014

 
 
Israel’s competitive advantage is not technology, it is creativity
 


   Dr. Reuven Reuveni - IsraelFebruary 15, 2014



 
 




Based on Global Innovation Ranking derived from WEF (World Economic Forum)  Executive Opinion survey, Israel is located in the honorable place – 6 among 139 countries, as has recently published in the prestigious Financial Times magazine
 The Israel’s high-tech industry today, is the sector accounts for more than 40 per cent of
national exports. Only the US attracts more venture capital funding than Israel.
This industry has transformed the national economy as well as the entire Israeli society via creating new wealth, a new class of entrepreneurs and a new role model for the young.
 “For thousands of years, a Jewish mother wanted her son to become a doctor,” says Yossi Vardi, the man who founded the country’s first software company in 1969 and is considered as the Israel’s original high-tech pioneer. “Now, in Israel, she wants him to become the founder of a start-up.
Haim Shani, the director-general at the ministry of finance says it is of “extreme strategic importance to the economy” . It is certainly due to 11 per cent to 15 per cent of national output and 14 per cent of the private sector labor force. Less tangible but no less important, it is also a source of considerable international prestige: at a time when Israel often finds itself isolated on the diplomatic front, the high-tech sector stands out as a universally admired national asset.
Israel today consistently finds itself at the top, or very near the top, of rankings measuring the number of start-ups, patents, venture capital investment and technology listings. During the last 15 years, the country has rebranded itself, in the title of a recent bestseller, as the “start-up nation” – cranking out ideas, patents, products and companies at a blistering pace. Only Taiwan, Japan and the US register more patents per head than Israel.
Analysts agree that many of the ingredients for the high-tech revolution were in place well before the first venture capital fund appeared in the early 1990s. The country had, for example, long boasted a highly educated population as well as strong universities and research institutions.
Certainly these were the main power to push Israel firmly towards creating a “knowledge economy” long before the term existed.
In spite of the recent concern over European and American sovereign debt may yet there are signs of improvement though.  Recent data published by the Israel Venture Capital Research Center show the country’s high-tech sector raised more than $1bn in capital in the first half of the year, an increase of 82 per cent compared with the same period in 2010. The number of companies obtaining funds was the highest in at least five years.
And more importantly, the sector is once again managing to secure profitable exits: MediaMind, the Israeli digital advertising company, was bought by a US rival for $517m in June. Last month, Dotomi, another Israeli advertising business, was snapped up by another American group for $275m. Deals such as these should go at least some way towards assuaging investor concern – and help persuade them to keep on funding.
Moreover,  there is no sign that the homegrown high-tech industry is missing any boats – as recent deals show that groups such as Facebook (which this year acquired its first Israeli company) have as much interest in the country’s start-ups today as Intel and Cisco did more than a decade ago, when the first wave of Israeli start-ups was snapped up. As Mr. Shani confidently summarized that the world will still need solutions that Israel can provide.
In summary, Erel Margalit, who now serves as chairman of a $900m fund and a well-known advocate of Israel’s high-tech industry, indicates that Israel's high-tech boom was always based on more than clever algorithms and nifty chip design.
 “People misread Israel’s competitive advantage,” he says. “Israel’s competitive advantage is not technology, it is creativity
Based on article entitled:   Israel: Invention tension
By Tobias Buck, published in Financial Times magazine


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