Israel Start-up Strategy

MOB3540 Israel Start-Up Strategy

4 (Elective Abroad) CreditsProgram fee is paid to Glavin Office - program fee includes: accommodations, breakfast, bus transportation in Israel, program planned meals, and cultural excursions. Not included: tuition, international flight, visa costs, additional meals and personal expenses.

The purpose of this course is to provide students with an opportunity to understand the entrepreneurial ecosystem (EE) of Israel - a country of about seven million people with the highest rate of NASDAQ listings per capita of any nation.

Through direct interaction with entrepreneurs, capital providers, educators, and government officials in Israel, the students should come away with a new perspective on startup's opportunities and challenges and get experience consulting to local startups while applying concepts from two books - Capital Rising: How Capital Flows Are Changing Business Systems All Over the World, co-authored by Peter S. Cohan with Srini Rangan, and Hungry Startup Strategy: Creating New Ventures with Limited Resources and Unlimited Vision (November 2012), by Peter S. Cohan.

Israel's ability to spur entrepreneurial innovation vastly exceeds its size. Israel has 7.1 million people but the number of Israeli companies listed on the NASDAQ far exceeds its relative population. For example, India has three companies listed. Japan has six, Canada has 48, while Israel has 63. Israel has received as much foreign venture capital as the much larger Britain -- $2 billion in foreign venture capital invested there in 2008 alone. And Israel has the highest density of startups in the world 3,850 - the equivalent of one startup for every 1,844 Israelis. Moreover, during the last few decades, Israel's high-tech innovations have spread around the world.[i]

How did Israel accomplish this feat? Israel has historically been geo-politically isolated from its direct neighbors, limiting trade and cooperation. An Arab nation boycott made regional trade impossible and it has very few natural resources. In addition, it has borne the impact of multiple military conflicts, putting pressure on its economy. As a consequence, Israel looks to the spirit of its people to overcome its many limitations. The way Israel has managed its human capital - a critical element of its EE - has allowed Israel to become an innovation hub.

Israel's entrepreneurial success depends on the people it attracts and how it harnesses their skills. Since Israel remains under constant political threat, all its citizens serve in the military which creates social networks and leadership training. Furthermore, Israel's culture of critique, fostered by centuries of Jewish tradition, encourages a spirit of relentless improvement. Moreover, the Right of Return immigration policy for Jews augments Israel's population with people motivated to build new lives and livelihoods. The result is a business climate that embraces risk and spurs the growth of good ideas.

Many examples of Israel's most successful start-ups spring from the application of its human capital to the gap between demand and supply. For example, drip irrigation was invented when a farmer in the Negev desert noticed one of his trees flourishing despite drought conditions. When he discovered a leaky underwater pipe, he had a moment of creative inspiration, developing a technology that spread around the world.

Many of Israel's greatest innovations were in the area of information technology. They include PC anti-virus software, to AOL Instant Messenger, and the Intel Pentium microprocessor chip. Israelis also created medical devices such as radiation-free breast cancer diagnostics and the "Gut Cam," an ingestible pill video camera that diagnoses abnormalities.

Hence one of the goals of the course is to explore how Israel has created such a vital EE and to give students a first-hand look at the Israelis who put the concept of entrepreneurship into practice.

The Israel Startup Strategy Elective Abroad is intended to provide students with the following benefits: to understand how Israel spurs startups, to get a deeper understanding of Israel's business culture, to meet entrepreneurs, business educators, government officials, and capital providers in Israel.