Israeli tech advocate warns sector is leaving rest of society behind
While record investments are a testimony to the country’s resolve, opportunities for digital transformation were squandered, says Start-Up Nation Central exec
Other than the negative factor which you mentioned, there is also something else that isn't talked about as much and is only now being noticed. Israel's tech industry may have reached 2021 in a good state, but there were also expectations that the start-up nation would deal better with the digital transformation and things like remote learning and even the cyberattacks that we are experiencing."Undoubtedly. The gap between the tech sector, which is surging ahead, and the rest of the economy and Israeli society, which isn't moving at the same pace, is a phenomenon we have identified and pointed out in the past and this year was especially prominent. We had an opportunity that we squandered as a country, to take this industry and its capabilities to reinvent ourselves and pivot and solve these challenges in the digital world. "Education is one of the most frustrating sectors. We already knew in May that we would be learning remotely in September and that Zoom provides a very limited solution. We had five months to prepare with this industry and that didn't happen. We also didn't fare any better than other countries when it came to digital health and remote healthcare. There is a warning sign here which we must pay attention to. Part of this is the result of the weakness of the political system, which is occupied with whether there will or won't be elections, rather than linking the engine of innovation, one of the best in the world, to the needs of Israeli society. Hopefully, we can do a better job making this connection in 2021." Over recent weeks and months, we are seeing a lot fewer M&A deals in Israeli tech and a lot more IPOs, including in Tel Aviv. Is this due to the constraints of Covid-19 or a new trend? "We are seeing the acceleration of processes. The Tel Aviv Stock Exchange should reflect the Israeli economy, which includes the tech sector that is displaying very strong growth. It is true that many Israeli companies are targeting Nasdaq and don't aim for the Israeli exchange, but small and medium-sized companies that are seeking a channel to go public can find a solution in the Tel Aviv Stock Exchange. This is part of the maturation of Israeli tech and a welcome trend. We would have arrived at this stage either way, but Covid-19 accelerated these processes. This presents an excellent opportunity, as is the entrance of institutional investors into tech. When you look at the global markets you can see that tech and innovation will set the tone in the 21st century. I'm really happy that 2020 connected those dots and the expectation is that we will see more Israeli companies growing organically in Israel and not just seeking an exit."