Israel A start-up nation

Transcription

1 Israel A start-up nation 1

2 Israel (2009) 7.4 mln inhabitants GDP $ 195 bln (Estimate) GDP per capita $ 26,351 Source TAMAT Technion University of Haifa 100 km Bar-Ilan University Tel-Aviv University Weizmann Institute of Science The Hebrew University of Jerusalem 2 Ben-Gurion University MBA-Entrepreneurship incubators over 2000 start-ups over 80 VC/PE s 68 companies on Nasdaq leading multinationals matured Israeli high tech including service providers Office of Chief Scientist 2

3 Phases in Israel s economic development Export mainly agriculture Building the science based capabilities: - Technion Hebrew University Weitzman Institute 1934 Innovations and entrepreneurship in Agriculture (Kibbutz) and the Defense area 3

4 Phases in Israel s economic development Arms embargo after six day war in 1967 Building defense-industry-university complex - 65% of R&D defense related - Defense as % of GDP grew to 25% in Indigenous industry for planes, tanks, electronics warfare Spin-offs from defense e.g. Elscint, Scitex, Orbotech Multinationals entering Israel (e.g. Intel, Motorola) Due to historical labor-socialist tradition deep antagonism toward individual entrepreneurship Establishment of Office of Chief Scientist in

5 Phases in Israel s economic development tipping point for take-off of high-tech sector High-tech, now already 34% of industry, drives growth Tech-entrepreneurs are the new heroes 5

6 The Hi-Tech Growth in Israel New High-Tech Companies average per year VC/PE raised in Mln dollars average per year From From ,214 6

7 Today: The Second Silicon Valley Silicon Valley Nr. Of start-ups VC invested (2004) 855 VC Investments ( 2006) $ 12,4 bln Israel 428 $ 1,4 bln New England 381 $ 2,8 bln Source: PriceWaterhouse Coopers, IVC,E&Y 7

8 Israel Is the Most Active European VC Fund Raising Country Per capita VC funds raised (2000) Israel: $600 per capita Europe: $30 per capita (20x) Source: IVC & VentureSource 8

9 Converging factors acting as tipping point the for hi-tech growth in Israel during the s Availability of technology in defense sector and universities Dramatic reduction of defense expenditure and defense industry employment ( Lavi employed directly 4,500 in in 1987; Defense 25,2% of GDP in 1980) FDI by high tech multinationals in R&D (spillovers) Influx of Russian scientists needing jobs Supporting government ( OCS) Double digit growth in engineering/science graduates Annual inflow of abt.800 experienced engineers from IDF Influx of US VC capital and Yozma funds The Israeli culture 9

10 R&D expenditure Israel Holland USA China R&D as 4,8% 1,9% 3,0% 1,3% % of GDP (ranking) (1) R&D in 4,909 7, ,759 $ mln (ranking) (20) (13) (1) 10 MBA-Entrepreneurship Source: IMD Competitiveness Yearbook 2004

11 Universities in Israel Technion University of Haifa Haifa Tel Aviv University Bar Ilan University Tel Aviv Weizmann Institute Rehovot Jerusalem Hebrew University of Jerusalem Beer Sheva Ben Gurion University 11 11

12 Multinationals in Israel Haifa Yokneam Yakum Herzliya Tel Aviv Outside of healthcare, multinationals with significant activity in Israel include: Rehovot Jerusalem Kiryat Gat Over 110 foreign companies have established R&D centers in Israel, collectively employing over 35,000. Source: Invest in Israel 12 12

13 . Office of the Chief Scientist Chief Scientist Activities in Israel R&D Fund Magnet Programs Generic R&D Seed Fund Technological Incubators Tnufa Research Institutes International Activities Bi-National Funds U.S-Israel Science & Technology Commission European Union Programs FP-6 EUREKA BI-National Agreements Global Enterprise R&D Cooperation 13 MBA-Entrepreneurship-2010 Grants: $ 400 mln; Royalty Income: $ 150 mln. 13

14 Human Capital - Israel s Biggest Asset % % % % 30 5 % 0 0 % Source: the ministry of finance 14

15 Yozma 1993 Jump-starting VC funding 15 Mission: To create the venture capital market in Israel Method: To entice the private sector and foreign investors to set up new VC funds, by securing foreign investors and contributing $ to the funds, securing the new VC funds obligation to invest in start-up companies in Israel Accomplished through: Establishment of a $100M government funded investment company Use of proceeds: Establishment of 12 funds together with strategic MBA-Entrepreneurship-2009 partners 15

16 2009 Summary of Israeli High Tech Company Capital Raising Israeli high-tech capital raising in 2009 reached $1.12 billion, 46% below 2008 level 16

17 Capital Raised by Sector

18 Why Israel? It s the Culture Informality A community spirit Risk taking International networks and experience Everyone questions authority Non-hierarchical society Building startups has become the national sport, entrepreneurs-the new cultural heroes 18

19 Why is Israel unique? Israeli high-tech building blocks = Flourishing high-tech Industry Supportive government policy (grants) Network Society Innovative, entrepreneurial risk-taking culture Strong co-op: academia & industry Strong defense industry (technologies adapted to new applications) 2. November 2010 Highly educated people No natural resources (brain power fuels economy) Influx of educated/skilled immigrants Highly skilled workforce due to training in military service 19 19

20 Essential Success Factors for tech driven growth in academic terms Knowledge capital Financial capital Human capital Social capital Entrepreneurship capital 20

21 Israel- A Technology Powerhouse Experienced 2 nd time entrepreneurs Government Support Incubators Defense University Students Foreign Technology Firms Availability of Technical People & Management Expertise Global Hi-tech Companies Seasoned VC Community Existing Technology Infrastructure Corporate Spin- Offs Corporate R&D Leading Academic Institutions & Research 21

22 Highlights in Israeli Innovation Pentium (Intel) Centrino (Intel) Telecom Billing(Amdocs) Call Center Logging (Nice/ Verint) Voice Mail (Comverse) Instant Messaging (ICQ, Ubique) PC Board Inspection (Orbotech) VoIP (Vocaltec) Two-bit per cell Flash Memory (Saifun) Disk on Key (M-systems) Generic Drugs (Teva) Irrigation (Netafim) Stents (Medinol) Firewall (Checkpoint) SW Performance (Mercury Interactive) AntiVirus (Alladin, Commtouch ) Regeneration of Spinal Cord cells (Proneuron) Virtual Colonoscopy (Given Imaging) Minimal Invasive FUS (Insightec) CT (Philips) 22

23 Entrepreneurship- Why the Technion? Technion graduates fill leading positions in 90 of the top 100 companies in Israel In present start ups Technion graduates are playing key roles in R&D and Management Increasingly Research Universities are the suppliers of new technology innovations and the source for technology start-ups, including the Technion 23

24 Entrepreneurship at the Technion 24

25 Bronica Entrepreneurship and Innovation Center (BEIC) Main goals: Lead the development of campus wide entrepreneurial activities, for students, faculty, staff and alumni Work in partnership with the Technion Research & Development Foundation to identify promising technologies and assist in commercialization Strengthen university and industry relations through joint research and action learning 25

26 Entrepreneurship at the Technion: TFL Work shops Work shops MBA Courses+ Grads BizTEC Adv Board I Lab E Club Consulting E Courses Graduate Students And Faculty Alumni Undergraduate Students Adv Board BEIC Adv Board Conferences 26

27 Academic Courses in Entrepreneurship at Technion Entrepreneurship guest lectures (Prof.Shechtman) elective Entrepreneurship and IP, Technion (under) graduates, 96815, elective (given twice in semester A and B) Entrepreneurship- BizTEC course, 95815, elective Introduction to Entrepreneurship (MBA) obligatory From patent to business plan (MBA and graduates) elective Growth and biz development of high tech companies (MBA) How to launch and run a software company (MBA+CS) Finance and Entrepreneurship (MBA) 98793, elective High-tech marketing, Technion (under) graduate, elective Marketing Principles, Technion (under) graduate, The business of biotechnology Innovation- Entrepreneurship workshops in EE faculty 27

28 Consulting Services Budding entrepreneurs are mentored and helped along every step in the process of launching their startup In the past semester over 25 startups have received free advisory Unilims (MBA students): due to the ongoing assistance we managed to develop the full marketing and business plan... We realized that the hypothetic idea we had been working on for almost six months, had already grown up to a real potential that could seriously become a startup company in a near future 28

29 The Entrepreneurship Club (E Club) A student organization committed to fostering thinking and discussion on entrepreneurship The E club meets every two weeks and provides the students a place to meet fellow young entrepreneurs and learn from one another The club invites speakers from industry to give educational talks The club includes around 100 students from all faculties (both undergraduates and graduates) 29

30 BizTEC The Annual BPlan Competition: The first Israeli student-led entrepreneurship contest, running for the 6th year with great success In last 5 years, 11 companies raised money BEIC supports BizTEC both logistically and with content (Academic director, workshop planning, judges etc) BEIC provides follow-up and guidance to all BizTEC participants More details at: 30

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32 Short summary BizTEC Year Participants Ventures concepts Finalist teams Around 800 Around Around Around Around

33 Israel National Entrepreneurship Conference One day conference for budding entrepreneurs, jointly with BizTEC semi-final event and Technion Alumni Organization 2010 theme: Entrepreneurship as a way of life Over 500 participants (conference is free of charge) Round Tables through-out the day Panels & key note speakers BizTEC finalists meeting the Sharks from TV 33

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35 Technion for Life Entrepreneurial support for Technion alumni Chief executives from Technion s Club 100 become mentors to budding entrepreneurs over 35 start-ups in 3 years of activity High success rate: 70% of companies raised money / achieved sales / performed exit 35

36 Comprehensive Website A Hebrew website offers a wealth of practical knowledge: Learn about the entrepreneurial path (how to write a BP, how to raise money, how to open a company ) through summarized information, samples and important links Information on the different activities, seminars and courses on campus Social network for Technion entrepreneurs Success stories and more 36

37 Action Learning Courses BEIC offers entrepreneurial education in a systematic fashion by broadening the scope and increasing the number of entrepreneurship courses. Some examples: From Patent to First Investment: teams composed of graduates and MBA students develop business plans for patent invented by Technion researchers. As a result of the first two courses, two startups received an investment. Entrepreneurship and Intellectual Property: intended for undergrads and grads from across the Technion, the course aim is to provide knowledge and tools on how to start a technology venture and how to create and protect IP. 37

38 Global Entrepreneurship Week Israel, 2009 Israel, one of the world s most entrepreneurial country, participated for the first time.beic was the local host The Israeli Goal: Leveraging the entrepreneurial experience of the Israeli high-tech and exposing initiatives from different sectors, while allowing a platform for networking, meant to increase entrepreneurial awareness of Israeli youth and encourage them to consider entrepreneurship as a career path. 38

39 Global Entrepreneurship Week Israel, 2009 Steering committee from 3 leading universities Very low budget Over 110 activities in Israel, ranked number 5 in total activities and number 1 in activities per capita Over 60 partners Local and national activities include conferences, workshops, round-tables, exhibitions, mentoring programs and more International activities include the Global Innovation Tournament and the Global Cleantech Open IDEA competition 39

40 Israel- The Start Up Nation CNBC, Oct 28,