Editor's Letter
Israel's Economic Juggernaut
I
srael derives its entrepreneurial heart from the military
training and battlefield experience that most Israelis get.
Israeli soldiers learn to lead and manage people,
improvise, become mission oriented, work in teams and
contribute to their country. They tend to leave their years of
service more mature, directed and skillful than their peers in
other countries.
They learn "the value of five min-
utes," one general told public policy
expert Dan Senor and journalist
Saul Singer, co-authors of the 2009
New York Times business bestseller
Start-Up Nation: The Story of Israel's
Economic Miracle.
In a March 2 online interview with
the JN, Senor said, "They even learn
something more uniquely Israeli: To
speak up — regardless of ranks and
hierarchy — if they think things can
be done better."
If you've ever met an Israeli, you know what Senor means
— and I say that as a compliment to the Israeli spirit!
The military exposure couples with an immigrant popula-
tion of inherent risk takers and entrepreneurs to propel a
national riptide of innovation and entrepreneurship.
Senor lives in New York City with his wife and two kids. He
is adjunct senior fellow at the Council on Foreign Relations
as well as an investor in and adviser for a global investment
fund. He has advised the Coalition in Iraq, the Pentagon and
the U.S. Senate.
Enlightened Sojourn
The impetus for Start-Up Nation was a 2001 trip to Israel that
Senor led. The Palestinians' second reign of terror against
Israel had begun in September 2000. At the time of the trip,
Senor was a second-year student
in the Harvard Business School.
The trip included 30 students; 27
were not Jewish and had no ties
to the Jewish state. The idea was
to examine economic opportuni-
ties as well as Israel's history and
politics.
Trip goers quickly discovered
the huge economic opportunity
to invest and do business despite
Israel being a young country with
no natural resources and no access
Author Dan Senor
to regional capital or regional
markets.
"If you were to paint a picture of the circumstances under
which you're not going to have a successful economic develop-
ing country, it would be Israel," Senor told me.
Ah, but one of Israel's gifts is the will to excel, challenges
aside. The state's economic firepower is staggering.
Israel represents the highest concentration of innovation
and entrepreneurship in the world, as Senor reports. It boasts
the most start-ups per capita; the highest percentage of gross
national product invested in civilian research and develop-
ment; more companies on NASDAQ than all of Europe, Korea,
Japan, India and China combined; and the biggest destination
for global venture capital per capita.
Israel is only 62 years old, has only 7.1 million people and
is located in one of the most hostile regions anywhere for
Jews. Yet it raises 2.5 times as much global venture capital
as America, 30 times more than Europe, 80 times more than
India and 350 times more than China. These numbers are
from 2008 when Israel all but escaped the meltdown that
roared through economies everywhere else.
It's a stunning story that local Jews can hear more about
when Senor keynotes a March 17 fundraiser for the Jewish
Federation of Metropolitan Detroit's 2010 Campaign. In light
of his appearance, I invite Senor to address in his remarks
whether, given Israel's economic expansion and Detroit's eco-
nomic contraction, whether Federation should consider keep-
ing even more Israel and overseas dollars home, at least until
our home-turf needs subside.
Ed Cherkinsky has been
Never Satisfied
While there has been a burst of clean-tech ventures in Israel,
most exciting to the Start-Up Nation authors are the compa-
nies and sectors you'd least likely expect in Israel — from a
world-class digital animation studio in Jerusalem to a next-
generation asset management industry in Tel Aviv. No Jew
should be surprised by Israel's penchant for recasting adver-
sity into assets that form the bedrock of an inventive culture.
Adversity of all kinds — being small, isolated and under
attack — has forced Israel to be resourceful, to do more with
less, to tinker and be global. "Israel leads the world in medical
device patents partly because when Israelis discover a tech-
nology:' Senor said, "they can't help but consider applications
to solve unrelated problems."
One such innovator is Given Imaging, whose founder real-
ized the miniaturized sensing systems in the nosecone of
a fighter jet could serve a medical purpose. He adapted the
sensor to produce a swallowable camera to beam out a movie
from inside a patient's intestines — making some highly
invasive and painful diagnostic surgeries all but obsolete.
Way To Peace
START-UP NATION
The Story of loners Economic Miracle
DAN SENOR de SAUL SINGER
& Wadi os r0.0 WOW.*
For over seven years,
From a political standpoint, it's clear
that Israel's economic success has
been central in convincing the Arab
world that Zionism isn't going away.
This, of course, is "the threshold
incentive for the Arab world to end its
attempt to destroy Israel:' as Senor so
eloquently put it.
"The moment the Arab world is
ready for peace he said, "the oppor-
tunities for economic cooperation
are great — and Israel could play
a pivotal role in helping regional
economies advance."
I was struck by Senor's assessment that the non-tech por-
tion of the Israeli economy is over-concentrated, over-regu-
lated and over-taxed. If Israel applied to that sector the con-
ditions driving its high-tech sector and, at the same time,
evened out demographic participation in the labor force, the
country could grow even faster, Senor said.
Israel could even become one of the top-10 largest econo-
mies in the world, as Prime Minister Benjamin Netanyahu
suggests. Yes, we're talking about tiny Israel, vilified by anti-
Zionists the world over.
volunteering at JARC.
His most rewarding
experiences have been with
the men from JARC's Evelyn
and Salman Grand Home.
Nearly every Thursday
evening, Ed has a "guy's
night out" with Jack, Ruben,
Robert, Michael, Ivan and
Chuck. According to Ed,
"We've become very close.
I am grateful to be part of
their lives and to have them
as part of mine."
Your generous support
will help Ed, the men of the
Grand Home and others
have meaningful and
fulfilling experiences.
Help JARC continue...
248.538.6611
jarc.org
❑
More on Dan Senor's local appearance: page Z
March 11 • 2010
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