Israel’s Latest Export Success Is British

British efforts to benefit from Israel’s Start-Up Nation have inspired similar initiatives in other countries.

Moti Milrod

Israeli technology is great. Israeli marketing sucks. That’s why the latest big thing emerging from the country’s tech sector isn’t Israeli at all – it’s British. It could be Israel’s most influential export yet.

You only have to look at Israel’s plummeting popularity in world diplomacy to see just how bad the country is at promoting itself.

The same goes for high tech. Israeli engineers, many of them fresh-minted army intelligence graduates, create world-beating, out-of-the-box technology solutions but when it comes to selling them they can fall flat on their faces.

With all the talk about Israel’s “Start-Up Nation” – in the phrase coined by Dan Senor and Saul Singer in their best-selling book about the country’s tech sector that now contributes about 40% of Israel’s industrial exports – it’s easy to overlook the formidable obstacles that stand between a brilliant idea and a successful business.

To turn great technology into a great company that can compete internationally, you need more than an original solution to a pressing problem. You need investment, a business strategy, visionary leadership, great marketing and huge dollop of luck.

Soon after Matthew Gould arrived in Tel Aviv as Her Majesty’s ambassador to Israel, he was introduced to Israel’s high tech entrepreneurs and realized that he could help them while simultaneously reaping great benefits for Great Britain.

In 2011, he founded the British Embassy Tech Hub, the first of its kind anywhere in the world. Using the connections that only government can deploy, the Hub links Israeli technology companies to British firms that can help them develop their business and penetrate new markets. The Israelis get access to top-class advice and business partners. The Brits get new clients and access to Israeli technology.

The Hub has been so successful that it is now being replicated at other British embassies in countries with similarly bubbling tech sectors. And other ambassadors in Tel Aviv are beating a path to Gould’s door to ask how they can copy the model.

George Osborne, Britain’s chancellor of the exchequer, told an audience at Gould’s residence that the hub was “just the start of something really exciting between our two nations.”

“It’s a brilliant initiative which has helped bring all those fantastic companies in Israel that are at the cutting edge of innovation and tech together with the similar brilliant companies in Britain so that we can increase jobs and prosperity in both our countries.”

“I know the tech hub has already brought many Israeli start-ups to London and given the opportunity of using the UK as a base for their international operations,” said Osborne. “It’s also enabled British companies to draw on the expertise that many companies in Israel have in areas like medical science and water technology.”

Andrew Mitchell, head of prosperity at the Foreign Office in London, told me that the UK is “always looking for different ways to adapt local opportunities, an out of the box way of doing trade and investment.”

“We think about the global economy in terms of our prosperity interests and in terms of our security interests,” said Mitchell. “We have to think far more strategically about how we work with other countries. We chose Israel because we felt we needed to find new ways to build bridges between strategically important nations in the context of trade and investment.”

In the past four years, bilateral trade between Israel and the UK has more than tripled – even though Israel’s diplomatic reputation in Britain and the rest of Europe has sunk.

Gould says the semi-diplomatic behavior of the hub allows the people involved to create useful connections without the hard sell that usually accompanies similar meetings promoted by the private sector.

“The main difference with the Tech Hub is that it’s not trying to sell anything,” Gould tells me. “It’s not trying to promote exports, it’s trying to promote partnerships. In particular, it’s trying to match technology with companies. It’s a classic win-win. Israeli technology finds a fantastic international partner that can help it go global and the British company allies itself with, or it gets to incorporate in its offer, the best technology in the world.”

“Over the past few years, more and more partnerships develop along these lines where you get a world-class British company like GSK pharmaceuticals or ShopDirect in retail, or Arup in construction, or Velcourt in agriculture, coming to Israel, us helping them find exactly the right partners so they can work with the best and most suitable Israeli technology, and a fantastic, mutually-beneficial partnership ensues,” says Gould.

One intriguing project has been initiated by Penguin Books, who are looking to Israeli-Arab partners to help them create Arabic content for publication in the Middle East and elsewhere.

“It’s obviously much better if the market sees the opportunity and does it itself,” says Gould. “We set up a Hub because we didn’t think the market was doing it. On the UK side, there were not enough British companies coming out to source technology in Israel. On the Israeli side there was an iron presumption that if you wanted to take your tech global, then you went to California. We felt it needed some strategically-driven, carefully-chosen matchmaking to make it happen.”

“These are partnerships that wouldn’t have happened without the Hub,” says Gould.

He ends his term as ambassador in mid-2015, but the independent structure of the Hub means it will continue after he leaves. During their recent visits, David Cameron participated in a tech event and Ed Miliband pointed to the strong cross-party support for the UK/Israel Tech Partnership, so backing from London will continue whoever wins the election in May.

Avi Hasson, Israel’s chief scientist and the government official most responsible for driving the country’s high-tech sector, describes the initiative as “quite extraordinary.”

“Science and technology are a main issue in economic prosperity. It creates benefits in both countries and for both societies. What the Hub has done in this short time is really remarkable,” Hasson says.

“The work of government is to bring people together. My experience is that if you bring smart, relevant people together to the same place, they will take it from there.”