Learning to innovate internationally with Israeli-like intuition

From its base in Europe’s answer to Silicon Valley, Innovation Centre Denmark can help its country’s startups to fulfil their potential

Pradisiacal Tel Aviv’s ability to inspire investors and entrepreneurs pursuing new business ideas and ventures extends way beyond the splendorous blue sea visible from its coastline.

Excellent human capital, infrastructure and a ‘chutzpah’ attitude are among the other elements that make Israel a world leader in innovation and a role model for countries like Denmark to follow.

A tech gatekeeper
Bill Gates called it when he visited Israel 12 years ago. “It is no exaggeration to say that the kind of innovation that is going on in Israel is critical to the future of the technology business,” he contended, and recent developments have underlined the country’s potential.

For example, this month’s multi-billion dollar purchase of Mobileye – a startup that develops vision technology for Advanced Driver Assistance Systems – by US tech company Intel has really put Israel at the forefront again.

“It’s a great deal: a representation of what Israeli companies are, and one that shows the growth of the Israeli tech sector,” said Avi Hasson, the chief scientist at the Israeli Ministry of Economy.

Louise Vibjerg Thomsen, the commercial counsellor & innovation officer at the recently-established Innovation Centre Denmark (ICDK) in Tel Aviv – one of just seven established worldwide – concurs that the deal was an attention-grabbing one.

“A lot of countries are looking to see what’s the intention of Intel,” she told CPH POST. “The acquisition came as a surprise, but it definitely shows that Israel is a technology centre and there is basically no area or field that Israel can’t play a part on.”

Logical location
The ICDK was set up in Tel Aviv last autumn for good reason. Already known as Silicon Wadi, the Israeli city has stolen a march on Scandinavia in the race to become Europe’s Silicon Valley, but there is no rivalry, contends Thomsen, only the desire for an ongoing collaboration between the countries to innovate.

The ICDK acts as facilitator, identifying opportunities and bringing together relevant partners in Denmark and Israel.

“There’s no competition between the countries, but more of a complementation,” said Thomsen. “They can be really good partners as Denmark and Israel are not necessarily strong in the same areas. Therefore, the two countries can collaborate and together they can make an alternative to Silicon Valley.”

Complementary collaboration
Denmark might not have that turquoise sea, but nobody can deny the charm of its famous lakes. And in terms of size – like Israel, it doesn’t have a big local home market or natural resources, so its economic drive comes from technology and research. While Israel has the cutting edge, Denmark’s location affords it a different perspective.

“While we are both strong in the research field, Israel is really strong at commercialising the research, making sure all of this data gets out of the university and doesn’t just stay in a drawer, but is used by society,” contended Thomsen.

Denmark can definitely learn from Israel, but there is also huge interest in Israel to work side-by-side with Denmark, she said.

“Israelis regard Denmark as an absolute frontrunner in research and a country that is extremely trustworthy,” continued Thomsen. “Everything that comes from Denmark is usually of high quality. Therefore, Israelis see Denmark as a strategic partner for them.”

A water tech deal signed earlier this year and their constant collaboration on digital health prove that the relationship is developing in a fructiferous way.

“In the case of water shortage, Israel is very strong in the area of water-saving solutions,” explained Ann-Christina Lange, the innovation attaché & interim head at the ICDK.

“It’s an example of how they see great potential for the Israelis and Danes to offer high-end, cutting-edge solutions to other markets together. We are both strong, but not strong enough to come on our own. Together we could become a great player.”

The startup nation
Israel is the ultimate startup nation. Still not 70 years old, its leaders have known from the beginning that innovation, dynamicity and flexibility was key to its survival, particularly given the challenges posed by its nature and neighbours.

Inheriting an arid land, the country’s founders transformed its landscape thanks to the hard work and irrigation ingenuity of the kibbutzim, while its government promoted innovation, establishing an infrastructure for growth and expansion in the areas of science and technology.

Its policies have encouraged startups to be global from day one. Tax incentives and policies, meanwhile, encourage investors, entrepreneurs and multinational companies to get involved.

“We want the best people to be involved in innovation,” explained Hasson. “We have created an aggressive corporate dividend tax as part of the OECD, for multinationals registering their intellectual property in Israel in order to put an end to the tax shelter and to incentivise them to bring their investment into the country.”

Israel currently has 70 bilateral agreements. Not including the US, Tel Aviv has more startups listed on NASDAQ than any other city. And outside investment continues to grow, with 2016 being yet another record year.

A hotbed of talent
In Israel, entrepreneurs are treated like rockstars and many of its citizens are motivated to become one. It’s seen at the ultimate crowning of the ‘chutzpah’ attitude that no challenge is insurmountable and failure is not an option.

“Israelis don’t like to follow orders, so they have to become entrepreneurs,” contended Eran Shir, the CEO of startup Nexar.

Compulsory national service instills in young Israelis a multitude of qualities: knowledge, problem-solving skills, an appetite for risk-taking, and the ability to quickly learn from mistakes.

Benjamin Soffer is the CEO of Technion, the Institute of Technology of Israel, where many of the country’s brightest minds come after finishing their national service.

The institute is charged with nurturing a living spirit of entrepreneurship that permeates every corner of the campus. It encourages students to become entrepreneurs and to think globally.

This, according to Thomsen, is another area in which Denmark can imitate Israel.

“We want to teach Danish entrepreneurs and Danish startups to adopt the same kind of worldview,” she said, adding that Israel itself is an excellent choice of stepping stone.

Dismissive of the perceived dangers of the country, Thomsen is adamant that the country has a bright future.

“We really encourage the Danish companies to see the potential because the risk is minimal,” she said.