Steinitz, Fischer, and Gurria - Michal Fattal
Finance Minister Yuval Steinitz, and Bank of Israel Governor Stanley Fischer meeting OECD chief Angel Gurria in Jerusalem. Photo by Michal Fattal
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If Israel is a start-up nation, then it has achieved that status despite the bureaucratic obstacles facing entrepreneurs, according to an OECD report released over the weekend.

While Israel ranks poorly in terms of bureaucratic obstacles, venture capital is relatively easy to obtain here, found the report on entrepreneurship drafted by the economic organization.

The report compares the difficulties that would-be entrepreneurs face in 37 countries, using a set of parameters that include laws and regulations.

Israel ranked 29th in terms of the bureaucratic burden facing start-ups, putting it only eight places above China, the last-ranked country.

The countries where start-ups face the least amount of bureaucracy are Ireland and Germany, determined the economic organization's report.

Another ranking determined how difficult it is to launch a business (not necessarily a start-up ) in the various countries, as of 2010. Here, Israel ranked 15th out of 30.

The good news: Israel ranked first in a list of venture capital investments as a percentage of GDP.

The ranking, based on 2009 data, found that venture capital investments in Israel were equal to 0.18% of GDP, which ranked it higher than developed economies such as the United States, the United Kingdom and Sweden.

However, Israel was found to be lacking in terms of investment in growth capital - investments in mature technology companies: Israel's venture capitalists tend to invest in young start-ups.

Israel came in behind the Czech Republic, Sweden and Luxembourg in a ranking of growth capital investment.

In a ranking of venture capital plus growth capital, Israel came in second to Ireland.

The easy availability of venture capital compared to growth capital is a market failure: Israel has more than 140 high-tech companies with sales of more than $10 million a year, but they have trouble receiving the capital that would enable them to become large, mature companies.