I Spotlight
Profit Center
Foreign investors look for green in Israeli clean-tech ventures.
Dina Kraft
Jewish Telegraphic Agency
Tel Aviv
F
rom cutting-edge geothermal
power deep underground to wind
turbines and solar panels capturing
energy from the sky above, foreign investors
are pouring money into Israel's growing
clean-tech sector. And its not just Jews.
"Every day I get calls from people asking
for opportunities to invest in clean tech-
nologies in Israel; said Michael Granoff,
president of the New York-based Maniv
Energy Capital and an investor in Project
Better Place, the company working to make
Israel a testing ground for an electric car.
"That to me is extremely encouraging:'
he said. "I believe nothing will determine
Israel's prosperity more than the degree to
which it is a leader in innovation around
sustainability!"
Clean tech, a catch-all term for emerg-
ing technologies focused on renewable
and more efficient energy consumption, is
soaring in Israel. A wave of new start-ups,
academic research projects and new venture
capital funds are focusing on the industry,
and multinational corporations such as
the Coca-Cola Co. and General Electric are
scouting out new technologies.
Fueling the interest in environmentally
friendly clean-tech solutions are skyrock-
eting oil prices, growing concerns about
global warming and a push for sustainable
solutions to the world's energy problems.
Investing in Israel's expertise may not
only make good business sense but benefit
the worldwide quest for cleaner, greener
energy alternatives. It also may constitute
an opportunity to bolster Israel's interna-
tional reputation by linking the Jewish state
with green innovation.
Jonathan Shapira, a recent American law
school graduate who writes a blog on clean-
tech investment in Israel, says diaspora
Jews can play an essential role by becoming
either consumers of or investors in Israeli
technologies.
"Every Jewish family and institution
should consider installing solar panels,
rooftop wind turbines or energy efficient
lighting developed in Israel," he said. "This
will lower their electricity bill, protect the
environment, benefit the Israeli economy
and help position Israel as a world leader in
clean technology'
The imperative for developing alterna-
tive energy sources is particularly acute for
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July 17 • 2008
The Solel Solar Thermal Energy Plant in Beit Shemesh, Israel
Israel because its enemies' strength derives
in large part from the world's dependence
on their oil resources.
"It really makes sense for reasons of
economics, but there is also the issue
that so much is at stake here said David
Rosenblatt, the vice chairman of the board
of a new solar power company near Eilat,
Arava Power, which is headed by Yosef
Abramowitz. "This is doing something for
Israel's national security, protecting its ener-
gy independence through green power!'
Rosenblatt, who also runs an investment
fund in New York, where he lives, said his
investment in Arava Power is a Jewish ven-
ture as well."This is about clean energy, but
ifs also about Jewish roots and what I can
do to express it and where I personally have
value to add:' he said.
In Herzliya, three American immigrants
in their 30s have created the first venture
capital firm to target the Israeli clean-tech
market, Israel Cleantech Ventures. They
recently raised $75 million for their debut
fund, exceeding their $60 million target.
Glen Schwaber, one of the firm's partners,
said enthusiasm among investors for
Israeli clean tech reflects Israel's growing
reputation as a potential incubator for new
technologies that is buoyed by the country's
high-tech success stories.
"Israel has a reputation for innovation
and technology, and a mature venture
capital environment along with a successful
history in entrepreneurship:' Schwaber said.
"The next logical place for the clean-tech
investor after Silicon Valley and the Boston
area is Israel!"
The Jewish state is beginning to capital-
ize on its experience in such fields as solar
thermal technology, wastewater recycling
and desalination.
Until recently, Israel had the world's
only large-scale desalination plant, off the
coast of Ashkelon. Now countries such as
China are building them. "Israel is a great
country to beta test some of these new
technologies because it is a microcosm of
the world's needs: shortages of water, a large
transportation fleet on per-capita basis and
an abundance of solar energy potential;'
said Schwaber, 38, who made aliyah from
Boston.
Among Cleantech Ventures' investors are
some big names in Jewish philanthropy,
including the families of Edgar Bronfman
and Stacy Schusterman. Schusterman, CEO
of the Samson Investment Co., a private oil
and gas company based in Tulsa, Okla., sees
her investments in Israeli clean-tech ven-
tures, including Israel's electric car enter-
prise, as business, not philanthropy.
"We saw this as an opportunity to lever-
age Israel's deep intellectual capital in an
area we see as a burgeoning worldwide
industry, and by investing it we would have
the opportunity to create a hedge against
our base business."
She added, "This is an area where Israel
should excel, so as a Jew I have every reason
to help make that happen."
Last month, the city of Los Angeles
signed an agreement with Kinrot Incubator,
a company located on the shores of the
Sea of Galilee that helps entrepreneurs and
researchers with water-based technologi-
cal innovations. The deal will enable Israeli
start-up companies to use water and power
facilities in Los Angeles for pilot projects
and to conduct joint research with the
University of California, Los Angeles on
water projects.
Los Angeles is interested in using the
Kinrot model to establish its own incubator
for water-related technologies.
Assaf Barnea, Kinrot's CEO, said that
although the water market is not new, the
hype over going green has given it a new
shine in the eyes of investors. "They have
now heard about it and want to be play-
ers," he said. "There is huge hype but it's
not just hype. This is a market that is here
to stay." ❑