Once a Possible Threat to Netanyahu, Israeli Tech Mogul Erel Margalit Quits Politics

After losing out in the race for Zionist Union party chairman to Avi Gabbay, venture capitalist-turned-MK Erel Margalit announces resignation from Knesset

High-tech entrepreneur Erel Margalit said Tuesday he will resign from the Knesset now that he has been defeated a second time in the Labor Party leadership race. Leah Fadida, the deputy mayor of the town of Yokne’am Ilit near Haifa, will take his place.

Margalit, an MK since 2013, came in fourth place in the July primary in which former Environmental Protection Minister Avi Gabbay was elected the party’s new leader.  

“It’s no secret that I wanted to be elected to head the Labor Party and be its candidate for prime minister,” Margalit wrote on his Facebook page. “The members chose differently and I respect their choice.”

Margalit, who is known for his feisty language, declined to say whether his departure from politics was only temporary. “I have not despaired of public work,” he told Haaretz, adding that for now the best role for him was as a social and economic entrepreneur, as he put it.

Margalit said he would now invest his time and money in projects in the Negev and Galilee, something he could not do as an MK.

This is the second resignation from the Knesset in a week by an MK from the Zionist Union, of which Labor is the senior partner to Tzipi Livni’s Hatnuah party. Argentine-born economist Manuel Trajtenberg is leaving politics to return to academia.  

A Zionist Union MK said he believed that Margalit resigned because he knew he would not win reelection. Only five men from the party’s slate (including serving MKs) will have a decent chance to make the party’s next ticket, while the other safe spots will be reserved for women, regional candidates, Hatnuah and people nominated by Gabbay, the MK said.

Margalit made his fortune as a venture capitalist and is considered Israel’s second-richest politician. He plans to return as chairman of the Jerusalem Venture Partners fund. He will be chairman of Bakehila, a nonprofit group helping at-risk youth.  

In the Knesset, Margalit served on the Finance Committee and the defense budget subcommittee. He headed the caucuses for the economic development of the north and south, Jerusalem, and small and midsized businesses.
 
Fadida said she was surprised when Gabbay phoned her only half an hour before Margalit announced his resignation.   

“I want to come to the Knesset to change [things] so that the social periphery will have a voice . There are good things to be done,” she said.

Fadida, 49, is married with two children. She moved to Yokne’am Ilit from Haifa 27 years ago and has served on the city council for 18 years. Fadida, the head of the community and public relations department for the Jewish National Fund, has a B.A. in social sciences and an M.A. in public policy.