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Digital World

Tel Aviv shows off its status as startup paradise

Daniela Späth | Yalda Zarbakhch
September 8, 2017

With the world's highest number of startups per capita, Israel is a dream come true for many young entrepreneurs. DW went to Tel Aviv's DLD Innovation Festival to find out what makes the Israeli tech scene so successful.

DLD Innovation Festival - Skyline Tel Aviv
Image: DW/D. Späth

The DLD Innovation Festival in Tel Aviv, Israel, is one of the most important annual events for startups in Israel. Roughly 400 startup companies looked for potential investors during the two-day festival and accompanying conference. Startup founders needed to keep their cool amid Tel Aviv's summer heat if they wanted to win over financial backers.

Nimrod Israely is one such startup head who was busy networking at the DLD Innovation Festival while highlighting the work of his company. The Israeli national has developed a non-chemical method of pest control for farmers. His start-up business "Biofeed" uses natural means only to combat pests.

DLD Innovation Festival - Nimrod Israely
Nimrod Israely wants to support farmers who choose to avoid chemicals when it comes to pest controlImage: DW/D. Späth

He says that as a founder of a startup, Israel is a perfect place for his agricultural products. "Our country is very small. If I want to go talk to farmers to get feedback about our products, I can quickly just drive to them. If I want to work on product development, I can drive to my laboratory in the city. Everything is within easy access here," Nimrod Israely told DW.

Israel's key role in the tech world

The Mediterranean nation has helped numerous new tech companies rise to prominence. The most recognized among them is the messaging provider ICQ. Another product originating from Israel is Mobileye — a sort of camera software developed for self-driving cars.

These two brands were eclipsed, however, by Google's 2013 acquisition of mapping service Waze to the tune of $1 billion (831 billion euro). This transaction put Israel on the map when it comes to significant investments in startups.

The country's entrepreneurial spirit has also inspired several US-based companies to relocate their research divisions to Israel. Intel now works on building new computer chips in Israel, while Microsoft improves its operating system and e-book reader Kindle keeps Israeli programmers busy.

Israeli Minister of Economy and Industry Eli Cohen takes pride in his country, calling it "the nation of innovation."

"Israel has changed a lot in the past two decades. Back then, the oil industry was the only industry that had any significance anywhere in the world. Today, the tech companies are on the forefront internationally," Cohen says, adding that in this new age of technology, Israel plays a key role.

Read more: Not just hipsters: Israeli start-ups are also moving to Berlin

Smartphone app wins DW prize

DLD Innovation Festival - Hanan Lipskin and Doron Yaakobi Start-up Keppers
Hanan Lipskin and Doron Yaakobi won DW's #startmeup contestImage: DW/D. Späth

Hanan Lipskin, another delegate at DLD Innovation Festival, says that it's no coincidence that Israel's startup scene is a world leader, especially when it comes to tech. Israel's army trains up young men and women to be cybersecurity experts who help keep the country digitally safe.

"Many of the startup founders here have a background in the tech division of the Israeli army, bringing a great deal of insight to the table from the start. Since there are no natural resources in Israel, we need to focus on other strengths," Lipskin says.

Lipskin is the co-founder of the Smartphone app "Keepers" along with his business partner Doron Yaakobi. The app is designed to flag questionable and abusive messages in social media and messaging services, such as Facebook, WhatsApp, Snapchat or Instagram, that find their way onto children's smartphones. If a child suffers threats or abuse on these platforms, the app will immediately notify the parents.

Hanan Lipskin and Doron Yaakobi's idea won DW's startup prize #Startmeup, which was awarded by DW's director general Peter Limbourg in Tel Aviv. To compete for the 2,000-euro award ($2,400), startup companies had to submit a 30-second video on the DW Digital Facebook page presenting their unique business ideas.

Israel's 'Silicon Wadi'

Israel's manageable size and its military know-how are major factors for its success in pushing digital frontiers with its startup scene. However, Yossi Vardi, who has founded roughly 60 companies to date and now works as an investor and political consultant, is certain that there is more than meets the eye.

"It's a part of Israel's culture to try new things and to aim to succeed while doing so, and, above all, to create something of your own. This is something that sets us apart from other countries," says Vardi.

Read more: Berlin start-up scene: Europe's 'Silicon Valley'?

But in order to guarantee ongoing success, Israel has to look beyond the boundaries of its "Silicon Wadi" and conquer markets like Asia, the US and Europe. It may be a startup paradise in many ways, but with its population of 8 million, the country has a comparatively small domestic market for its tech creations.

 Yalda Zarbakhch
Yalda Zarbakhch Head of DW Persian@yaldina