Start-up Diversity

ALL INCLUSIVE

Israel’s prestigious start-up sector has traditionally been dominated by secular Jewish men from the Tel Aviv area belonging to the country’s socio-economic elite. Several NGOs address this unjust situation through initiatives that actively encourage entrepreneurs from disenfranchised sectors of society to join the Start-Up Nation

If you were born in Herzliya or Givatayim to well-educated parents with respectable professions, chances are you grew up in an environment that enabled you to nurture your dreams and pursue the career of your choice, especially if you are a male. And if your dreams included being part of Israel’s esteemed high-tech and start-up scene, you probably had the appropriate personal contacts and education to get your foot in the door.

Israeli women entrepreneurs on the first WEACT mission to Silicon Valley

Indeed, a single sector of Israel’s diverse population is disproportionately overrepresented in the local high-tech industry. Several initiatives are devoted to rectifying this injustice by providing the necessary support to aspiring entrepreneurs from other sectors of society, such as Arab Israelis, the ultra-Orthodox and even women.

Starting Up Together

The Peres Center for Peace and Innovation has long advocated full inclusion of Israeli Arabs and other disenfranchised cohorts into Israeli society, and most of its activities focus on promoting coexistence. In conjunction with the opening of its Israeli Innovation Center in September 2018, the Center has developed a unique initiative whose goal is to foster greater inclusion in the Start-Up Nation. Called ‘Starting Up Together,’ the pilot project is now being rolled out under the leadership of Yarden Leal, Deputy Director General for Development and External Relations at the Peres Center.

“All of the Peres Center’s projects address a real need in a given sector and seek to make a difference in people’s lives,” Leal explains. “Starting Up Together was born out of a need for large sectors of the Israeli population to find a place in the Start Up Nation. When we started to explore the field, we found that there were endless amounts of academic courses and programs targeting entrepreneurs, but we wanted to bring added value. We discovered that there were few programs that focused on including the ecosystem of Israel’s social and geographical periphery, and so we developed a unique year-long program to address this need, with an emphasis on Jewish-Arab relations.”

A Peres Center program promoting coexistence through technology

The first phase of the project is outreach. “During this phase, we will identify a cohort of 40 entrepreneurs – half of them Jewish and half Arab – with diverse backgrounds, including Haredim, Bedouin, women, etc… We will work hard to find participants who have ideas, ability and charisma but don’t have an opportunity,” Leal notes.

Once the group of 40 participants has been assembled, they will be invited to take part in a one-month preparatory program whose curriculum will depend on the participants’ needs, since the idea is to tailor the contents to their requirements. It might therefore include lectures and workshops on such subjects as business plans, legal issues and business English.

After completing the preparatory program, participants will proceed to the incubator phase. The most promising 6-8 participants will take part in an intensive five-day boot camp that will culminate in a start-up competition during which they will have to pitch their ideas to actual investors. The Mass Challenge Jerusalem Accelerator, which is one of the project’s key partners, will host the boot camp. Other ‘Starting Up Together’ participants will take part in a program sponsored by Tel Aviv University, which will include lectures, meetings with mentors and hackathons.

High-tech in the Arab community

Israeli Arabs currently account for less than 3.5% of Israel’s high-tech workforce despite being 20.7% of the country’s total population. Tsofen, an NGO founded in 2008, is helping to change the statistics. In fact, Tsofen has been instrumental in increasing the number of Arab citizens employed in high-tech from 350 ten years ago to 3,700 today, with the number of engineering positions in Nazareth alone jumping from 30 to 900.

Makeathon in Nazareth organized by Tsofen for Jewish and Arab programmers and entrepreneursEhab Hosari

“Our approach is two-pronged,” explains Tsofen co-CEO Paz Hirschmann. “On the one hand, we seek to develop human capital by exposing Arab high school students to the world of high-tech, and through workshops and mentoring programs for Arab students, among other activities. The other side of the coin is expanding the employment opportunities by convincing high-tech companies to open branches in Arab cities and by helping local entrepreneurs launch startups in places such as Nazareth,” he elaborates.

Indeed, Tsofen has been deeply involved in developing Nazareth’s high-tech industry. Today there are more than 50 local start-ups in the city, and leading companies such as Amdocs, Broadcom, Microsoft and Alpha Omega have opened branches in Nazareth. “There is a shortage of engineers throughout the high-tech industry,” notes Hirschmann, “and Nazareth has a skilled and educated workforce that is a perfect fit.”

Largely as a result of Tsofen’s efforts with high school students, in the past four years there has been a 62% increase in the number of Arab students enrolled in technology degrees at Israeli universities. Tsofen runs hands-on training courses that help students and recent graduates gain the skills they need to succeed in the job market, as well as offering an extensive mentorship program that matches students with experienced engineers, guiding them in their studies and with the application process. Since 2008, Tsofen has directly placed over 1,000 candidates in high-tech positions – including over 80% of the 650 graduates of its courses.

Tsofen’s other co-CEO, Sami Saadi, adds that Tsofen aims to establish three high-tech parks in Israel’s Arab sector: one in Nazareth that is already flourishing, one in Kafr Qasim, which is in its infancy and, in the future, a third in a Bedouin community in the South, either in Rahat or Hura. “The idea is for educated Arabs to be able to work in their own communities, but we also encourage coexistence between Arabs and Jews. In fact, 20-30% of the high-tech workers in Nazareth are Jewish and the management is often mixed,” Saadi explains.

Giving Haredim a chance

Another large segment of society that has traditionally been excluded from the Start-Up Nation is the ultra-Orthodox, or Haredim. Moshe Friedman founded KamaTech, an NGO devoted to making the high-tech and startup ecosystem accessible to Israel’s ultra-Orthodox sector, following the insurmountable challenges he faced as a Haredi turned budding entrepreneur. Educated to become a rabbi, Friedman was exposed to technology and the Start-Up Nation for the first time at age 30, when he bought a computer for the purpose of conducting Torah research. “I saw interesting things on the Internet. The world of innovation and technology attracted me and I started to teach myself everything, including English, on the Internet,” Friedman recalls. Despite the fact that he had no relevant education, he started to develop a product related to videos and began attending lectures and events, meeting as many people as possible. Everywhere he went, he was the only Haredi and wasn’t taken seriously.

KamaTech entrepreneurship event for the Haredi community

The turning point came in 2011 when Friedman met Yossi Vardi, the start-up guru, at the first DLD Innovation event in Tel Aviv. Vardi was intrigued by the young Haredi entrepreneur who was unable to penetrate the local start-up ecosystem, and decided to help him and others like him. The KamaTech NGO was born soon after that first encounter, founded by Vardi, Friedman and Zika Abzuk, a senior manager at Cisco Israel and a social activist.

Since then, KamaTech has helped over 10,000 ultra-Orthodox men and women, in many cases facilitating their entry into the workforce. “There are many Haredim who are trained as engineers and computer scientists but can’t find work,” Friedman elaborates, adding that, “There are three reasons for this: 1) they usually study at all-Orthodox colleges and not at the top universities, leading companies to assume that their education is insufficient; 2) prospective employers don’t think Haredim will fit in culturally because of issues related to men and women working together, kashrut requirements and so on; and 3) they can’t find jobs because they don’t have friends in the right places and can’t network, since they didn’t attend the Technion or serve in the army’s elite Unit 8200.”

KamaTech is dealing with these challenges on several fronts. The first is to train Haredim by offering courses on such subjects as cyber, programming and web development, often under the auspices of leading companies like Check Point and Google. Former U.S. Ambassador Dan Shapiro, who is now on KamaTech’s Board, arranged for the Embassy to offer English classes. KamaTech also helps qualified Haredim find employment, thanks to huge efforts made to convince all the major high-tech companies in Israel to give Haredi job applicants a fair chance.  

One of KamaTech’s principal goals is to assist potential entrepreneurs by giving them the tools to join the Start-Up Nation. “I decided that we have to teach them what ‘start-up’ means and how to do it,” says Friedman. “We organized events in Bnei Brak and Jerusalem with lectures by Israel’s leading entrepreneurs, those who are behind such companies as Waze, Wix, Mobileye and others. It was amazing – hundreds came to each event. We built a community of Haredim interested in technology.”

In addition to organizing traditional accelerators, KamaTech also initiated an innovative program called Kangaroo, whereby Haredi entrepreneurs are hosted by large high-tech companies for free for four months, during which they are personally mentored by the CEO. Each Kangaroo cycle has eight participants, with the last cycle attracting over 600 applicants! This number is especially remarkable given that only four years ago, when Friedman organized a start-up competition with the help of Vardi and Chemi Peres, only 20 people applied.

Now that the community of Haredi entrepreneurs has grown so much, a venture capital fund was recently inaugurated specifically for this cohort, under the leadership of Chemi Peres and with personal investments from CEOs of some of Israel’s largest companies, almost all of whom are secular.

And what is the next step for Friedman and KamaTech? “We will soon launch parallel programs for other sectors of society that are underrepresented. The first will be for Israeli Arabs, together with Tsofen and other partners,” Friedman announces, proving that he truly is an incurable entrepreneur. 

Gender equality

Despite consisting of half of the population, women are vastly underrepresented in the Start-Up Nation – except, interestingly, in the ultra-Orthodox sector, where a whopping 40% of KamaTech participants are female.

“Women Entrepreneurs Act,” known as WEACT, is a new initiative aimed at empowering and facilitating women to turn their ideas into viable business ventures and supporting blooming startups’ growth efforts through the Silicon Valley’s resources. Darya Henig Shaked, an Israeli lawyer and impact investing executive who moved to Silicon Valley with her family two years ago and is the CEO of Stride Ventures, founded WEACT after being shocked by how few successful women entrepreneurs there are. Realizing that Silicon Valley, whose wealth of opportunities is an important springboard for many men, is largely inaccessible to Israeli women entrepreneurs, she decided to try to mediate a solution.

“I am a strong believer in women's capabilities and the potential they hold for social impact through the entrepreneurial ecosystem. That's why I will do my best to make their efforts fruitful,” explains Shaked. Her idea was to lead a delegation of Israeli women on a one-week intensive trip to Silicon Valley, enabling them to gain first-hand experience and meet potential business partners and investors. At the same time, they would obtain a sense of belief in themselves and their potential to build global corporations.

Shaked raised over $100,000 in just two weeks to fund the first delegation, enlisting sponsors in order to defray the costs. The initial response was overwhelming. “We had space for 20 women but 182 wanted to come!” she recalls, adding that a panel of 12 judges was entrusted with the task of selecting the lucky winners.

The first delegation arrived in California in November 2016. The participating women represented a range of industries, including cyber, face recognition, digital health, AI, fashion and many others. They met with executives from such leading companies as Facebook, Google, Intel, Silicon Valley Bank and Morgan Stanley, as well as with experts from leading VCs such as Bessemer Venture Partners and Intel Capital, the business incubator StartX, the Singularity University think tank and many other local start-ups. They also heard lectures by Stanford Business School professors and an array of leading local entrepreneurs. Delegates participated in a variety of workshops, networking events in Palo Alto and San Francisco and much more.

Nearly all the women in the pilot group reported that the trip was extremely beneficial on both a personal level and in terms of their future as entrepreneurs. In fact, in the weeks after the delegation returned to Israel, one woman sold her company to Apple and five opened offices in Silicon Valley – to name just a few of the positive impacts. Following the success of the first trip, a second WE ACT mission is set to travel to Silicon Valley in mid-October. In line with Shaked’s conviction that “some of the biggest challenges of today’s world are the outcome of inequalities, either social or gender-based,” the upcoming delegation will include a cross-section of women from all walks of Israeli society, including from the Arab and Haredi sectors. They are set to meet an A-list of Silicon Valley entrepreneurs, including the founder of Houzz (an Israeli American woman who is a self-made millionaire in the tech industry) and the entrepreneur and investor Kevin Hartz, among many others.

In addition, WE ACT has developed into a large Facebook community of over 1,000 people “supporting female entrepreneurs and building a more equal opportunity ecosystem.”