Palestinian Entrepreneur Seeks to Turn Jerusalem Into Startup City - Together With Jews

Palestinian entrepreneur Hani Alami is setting up an accelerator on the city’s seam line to draw budding entrepreneurs from both sides of the city.

Inbal Orpaz
Inbal Orpaz
Hani Alami: “We have to start changing the city’s image.”
Hani Alami: “We have to start changing the city’s image.” Credit: Eyal Toueg
Inbal Orpaz
Inbal Orpaz

It’s hard to imagine a worse time than now to undertake a new venture in Israel-Palestinian cooperation in Jerusalem. The city has been shaken by the deadly synagogue attack in its Har Nof neighborhood and by the torching of the Jewish-Arab school.

But the violence and hatred has done nothing to deter Hani Alami, a high-tech entrepreneur and millionaire from East Jerusalem. In fact, it seems to even inspire him. The worse the situation becomes, the more determined Alami seems to be to pursue his vision of making Jerusalem the high-tech intersection between Tel Aviv and Ramallah and persuading the city’s young people to remain.

Alami is about to open a tech accelerator on the ‘seam line,’ the border that divided the city’s eastern and western halves until the 1967 Six-Day War. He hopes the space will be a kind of neutral territory, where both Israelis and Palestinians will feel comfortable.

“I want people to come, to sit together and to start working together — young people from the east and the west. I want to build connections and to bring the two sides of the city together in projects,” Alami told TheMarker.

He may sound nave, but Alami is fully cognizant of the difficulties he faces in realizing his vision.

“Jerusalem is a difficult city. We have to start changing the city’s image, all of us together, otherwise the extremists on both sides will be in control and we’ll have to leave,” he said. “The other option is that we can take control of the city and all of us can live in peace and quiet. Extremists can’t live among the peaceful. Only one of us can exist.”

Indeed, seeing so many of his friends leave Jerusalem was one of the inspirations for the accelerator.

Friends abroad

“I realized that every time I wanted to call an old friend, I had to make an overseas call. It’s brain drain. Anyone who can work in Jordan, Bahrain, Britain or the United States is doing so,” he said, adding, “Everyone says they can’t live in Jerusalem any longer because the situation is so discouraging. No one is left here, just drugs, the unemployed and the desperate.”

Alami has an even more personal stake in the accelerator’s success. After she enrolled as a freshman at the Hebrew University of Jerusalem, Alami's daughter decided to move to the United States. Alami regrets that he was unable to deter her, and other people, from leaving.

The situation isn’t much better in West Jerusalem, at least when it comes to tech startups. The center for them is in and around Tel Aviv area, on Rothschild Boulevard downtown, in Ramat Hahayal in the north of the city and in Herzliya Pituah.

Only in the last two years, thanks to the combined efforts of a group of young Jerusalemites determined to make the city more hospitable to startups and city officials has the situation changed. The number of new tech companies rose eight-fold this year, to about 100.

But the turnaround hasn’t included Jerusalem’s Palestinians. Alami sees his task as making that happen.

He sees his city as half healthy (West Jerusalem) and half paralyzed (East Jerusalem).

“How can you run a marathon if half your body is healthy and half is paralyzed? As a businessman I believe peace will come through business, not politics. It will be easier to build peace and to change what we see every day in our city. We can also help politicians that way because when people have money in their pocket, they have something to lose. This isn’t a city divided by a fence or a wall — let’s start doing business together.”

Alami, 44, is married with two children. He was born and raised on the Mount of Olives, overlooking the Old City, to a large and well-established Jerusalem family that owned a cigarette factory and a dairy, among other businesses.

Most of his siblings went into the family businesses, but Alami decided to strike out on his own.

He earned a degree in communications engineering from the American University of Cairo and over the next 20 years went from being a junior employee at Motorola to being a telecommunications magnate in the Arab world and the Palestinian Authority. Today he is CEO of Coolnet, an Internet service provider that also provides integration services for wireless networks to Israeli companies such as Bynet, Cellcom Israel and Bezeq.

Alvarion bid

Alami burst onto the Israeli tech scene just over a year ago, when he and two partners bought the Israeli telecommunications company Alvarion for 28 million shekels ($7.1 million). He sold his stake just a few days later to his British partner. After his quick exit Alami unveiled his two goals for the coming years.

The first was to set up a technology accelerator in East Jerusalem, the project that is now being realized. The second was to transform Coolnet into a leading ISP in the Arab world.

Unlike the group of young people in West Jerusalem, Alami did not wait for official support from the city before moving forward. His accelerator, called JEST — Jerusalem, entrepreneurship, society and technology — is designed to remove the two biggest barriers faced by young would-be entrepreneurs in East Jerusalem in particular.

The first is the absence of an entrepreneurial community and the absence of “soft skills,” that is emotional intelligence or interpersonal communication skills. The second is the high cost of renting office space. A one-room office in East Jerusalem rents for about $1,000 a month, not including arnona (municipal taxes). National Insurance Institute and income tax payments for independent contractors come on top of that.

“A young man doesn’t even want to think about it, he’s rather make 5,000 or 6,000 shekels a month in Ramallah” as a salaried employee, Alami said.

For a token fee of 250 shekels a month JEST will offer 40 aspiring young entrepreneurs work space and help in setting up a company, developing a business plan and branding. They will also get mentoring help from older, established tech companies. The goal is to ready the new startup to set out on its own within six months to a year.

Alami will lend his expertise and connections, but he is also counting on help from Israeli tech companies in West Jerusalem and Tel Aviv. He is also getting financial help from the U.S. Agency for International Development, the European Union, the U.S. consulate, the U.S. company Cisco and a group of Jerusalem businesspeople.

Are there young people in Jerusalem that can take advantage of an accelerator? Alami said there are, but most of them are working elsewhere in the Arab world. East Jerusalem Palestinians, he notes, were behind Maktoob, the Jordanian Internet company that was acquired by Yahoo five years ago in the first ever such exit in the Arab world.

The key founder of the Ramallah-based online hotel booking website Yamsafer also came from an East Jerusalem family. “Every day drives to Ramallah and returns to Jerusalem in the evening because in Ramallah there’s an ecosystem. What is there in East Jerusalem? Nothing. Everyone is in Ramallah and Jordan,” Alami said.

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