The Far East has become the “in” place for Israeli entrepreneurs and start-ups, as China, India, Japan, Korea, and other countries in the region tap into the Start-Up Nation’s innovations. But don’t write off Europe just yet — there’s still plenty of opportunity there, according to Israeli investment professional David Vita. And the European country with the biggest opportunities for Israel, he believes, is Poland.
“The Polish government gets an annual $20 billion from the European Union in development money for manufacturing and infrastructure, and the grants offered to start-ups are quite generous,” said Vita. “For every dollar’s worth of intellectual property a foreign company brings to the country (the value of which is determined by authorities), the government provides $3 in grants. And they are really interested in Israeli technology,” said Vita, an expert on European and Polish investment issues at Tel Aviv’s Cukierman and Co. Investment House.
Already now, Israeli security firm Risco is Poland’s largest provider of security solutions for alarms, perimeter control systems, and intrusion detection. During President Reuven Rivlin’s recent state visit to Poland, Risco was a premier presenter at a seminar on developing Israel-Poland economic ties. Risco has been active in Poland since 1997 and has had an office in Warsaw since 2007.
For many Israelis, as well as for Jews around the world, the notion of close diplomatic and business ties with Poland sounds strange, to say the least. It’s the country where 3 million Jews were killed in the Holocaust, and where the large majority of concentration camps and death camps were located. Although it was the German Nazis who masterminded that mass murder, many Jews believe that Poles were willing collaborators, and Holocaust-era literature is full of accounts of Poles either aiding and abetting the Germans, or, at the very least, remaining aloof, allowing the Nazis to destroy Jewish communities that had been in place for centuries.
Vita believes the Poles are very interested in moving on and building a relationship with Israel. “No one in Poland denies the Holocaust, or the assistance rendered by some Poles to the Nazis. On the other hand, we have to remember there were many who fought against the Nazis, and many who were recognized by us as ‘the Righteous Among the Nations’ for their efforts to protect Jews. In some ways the Poles are more open about the Holocaust than we are.” Often, Jewish visitors try to avoid the subject when meeting with potential Polish business associates, but it’s the Poles themselves who bring up the issue in order to clear the air, said Vita.
Notions that Poland’s economy is still retarded by Communist-era habits and strictures are as outdated as Marx and Lenin themselves, he added. Poland is a member of the European Union, although, under special arrangements, the country uses is own currency, and today Poland has the sixth-largest economy in Europe.
Israel and Poland established diplomatic relations in 1990, and after a meeting with Polish President Bronislaw Komorowski, Rivlin said that the two countries have “for 25 years enjoyed a relationship that has not been simply between governments, but has become a close relationship between two peoples, looking to the future, without requiring either you or us to forget the past; the wonderful past in which Poland was home to so much of the Jewish people, and also the horrific years of the Holocaust, of catastrophe, and of heroism.” Komorowski concurred, adding that “I have no doubt that during your visit, we will continue to build and reinforce the strong ties between our countries in a range of fields, including economic and security.”
It’s no accident that Komorowski mentioned those two areas specifically. Poland, Komorowski said, sees Israel as an engine that can help kick start Polish entrepreneurship, turning the country into a center of innovation. “Poland has a lot of advantages for Israeli start-ups,” he said. “Because they don’t use euros, instead maintaining their own zloty currency as legal tender, prices are much lower there than in the rest of Europe – and, of course, there are numerous partnership and funding opportunities for start-ups, via the EU funds. And Poland is right next to the EU’s biggest economy, Germany, so it’s a great springboard for doing business not only in Eastern Europe, but in the West, as well.”
One of the fields Poland is interested in is alternative energy – especially wind energy, an area Vita has been active in, having set up several turbine projects that will soon supply over 50 megawatts of wind-generated electricity for Poland. Now, through his consulting firm Makwa Ventures, he is working with Israeli start-ups and established businesses seeking entree into the Polish market, assisting them in finding locations, local staff and managers, producing licenses, and grants. Vita was behind the development of the Israel office of MassPort, considered the most successful US-Israel trade office by most in the Israeli business community, “so I have a little experience in helping businesses adapt to new venues,” he said.
Israeli companies seeking to get involved in Poland could take an example from Risco, currently the most successful Israeli-owned venture in the country. “Risco Group holds 20% of the market in Poland and is the largest foreign company in Poland in the security area,” said Hemy Fintsy, vice-president of marketing at Risco. “Over the years, Risco has become a well-known and trusted brand in the Polish business community. Poland is one of the largest countries in Europe, and with new agreements between the two countries, there are many new opportunities for Israeli companies in Poland, both within the country and as a springboard for exports.”