Arab entrepreneurs get a tech boost from IDF veterans

Arab entrepreneurs get a tech boost from IDF veterans

The Nazareth-based Hybrid project brings together former Israeli soldiers and Arab tech workers

Ambassador of Belgium, Mr. John Cornet d’Elzius, Beta Group, Investors, VC's and Entrepreneurs visit the Nazareth Business Incubator Center, May 12, 2015 (Courtesy)
Ambassador of Belgium, Mr. John Cornet d’Elzius, Beta Group, Investors, VC's and Entrepreneurs visit the Nazareth Business Incubator Center, May 12, 2015 (Courtesy)

A new program to promote start-ups in the Arab sector is taking place in cooperation with the 8200 Alumni Association, an organization that represents graduates of the top technology unit in the Israeli army. For some Israeli Arabs, this may raise eyebrows.

“I would agree it is very unique, and perhaps controversial in some quarters, but I think it’s a really good idea,” said Fadi Swidan, director of the Nazareth Business Incubator Center, where the program is taking place. “But once people understand the potential benefits – the greater access to investments and contacts in the Israeli tech ecosystem – they get on board.”

The Hybrid Program, as it is known, was introduced this week by the Ministry of Economy and Industry to encourage and nurture Arab start-ups, at the Nazareth Business Incubator Center in cooperation with the 8200 Alumni Association. The program’s goal to significantly increase the number and quality of start-ups in the Arab sector.

“There are already a number of programs to help start-ups in the Arab sector, and many of the companies get initial funding from the Office of the Chief Scientist in the Economy Ministry,” said Swidan. “But for various reasons many of those start-ups don’t get to the next stage, raising A-round and further stage funding from venture capital firms.”

Racism is not the issue, Swidan believes.

“It’s more that investors aren’t familiar with our tech scene in Nazareth, and because they don’t know us they’re a little hesitant. That’s where our partnership with 8200 comes in. They have the contacts and the resources to help integrate our start-ups into the Tel Aviv tech ecosystem.”

Soldiers from the 8200 Unit in training (photo credit: Moshe Shai/Flash90)
Soldiers from the 8200 Unit in training (photo credit: Moshe Shai/Flash90)

“8200” is the IDF unit that specializes in communication technology for defense purposes. The program attracts top talent in various tech areas, and uses their skills to help defend the country. When de-mobbed, these ex-soldiers go on to top jobs in the tech industry and many of them have over the years established some of Israel’s most well-known tech firms, including Check Point, ICQ, Palo Alto Networks, NICE, AudioCodes, Gilat, Leadspace and Ezchip, to name just a few.

Eitan Sella (Courtesy)
Eitan Sella (Courtesy)

There are thousands of 8200 alumni in Israel, well-placed throughout the tech economy. The new Hybrid partnership is a way for them to “give back,” helping others who need a boost in getting their start-ups off the ground. Working with Swidan to head Hybrid is Eitan Sella, an 8200 alumnus and a Senior Information Security Consultant at cyber-security firm Comsec. The program “has the potential to serve as a bridge between Israelis and the Arab world,” an important goal at any time – made even more urgent by the current growing tension between Jews and Arabs, and between Israelis and Palestinians.

The program, said Sella, exists for one purpose – to help Israeli Arabs integrate into Israel’s tech ecosystem. Hybrid is not for profit, and takes no equity from member start-ups. It will also not be limited in verticals or tech fields; all good ideas are welcome. “ We’re here for one reason only: significantly increase the number of Arab entrepreneurs in Israel, and by this reshape the ‘Startup Nation,’” he said.

The program will operate in association with a large number of partners from the high-tech industry, including Bank HaPoalim and Poalim Hi-Tech, EMC Center of Excellence, Shibolet and Co. Law Firm, SAP Labs Israel and Galil Software. Last week the program’s management team issued a public call to find suitable enterprises. Ten start-ups will be chosen to participate in the program, which will officially begin in April.

Nazdiv's Fadi Swidan (Alan Weinkrantz)
Nazdiv’s Fadi Swidan (Alan Weinkrantz)

According to Ran Kiviti, Director, Small and Medium Businesses Agency at the Ministry of Economy and Industry, “if platforms for encouraging entrepreneurship and facilitating the transformation of innovative visions into thriving businesses are necessary for any start-up founder, including army intelligence graduates living in Tel Aviv, they are even more crucial in the north. Graduates of this program will be uniquely equipped with the skills and connections required in order to transform their technological ideas into businesses – and will serve as role models for other aspiring entrepreneurs in their communities.”

Arab entrepreneurs are more than ready and willing to get help from 8200, said Swidan. “I think that at one time, there might have been reluctance, both political and cultural, to embrace something like this, especially with an organization so closely identified with the IDF. But in recent years, more Arab tech graduates have gone to work with Israelis in the tech companies in Yokne’am, Haifa, and even Tel Aviv, and they have become more comfortable with Israelis in general. And even here in Nazareth in the area, there are major companies like Broadcom and Amdocs that have tech centers.”

Just last week, Microsoft announced that it was seeking to open an new R&D center in Israel – in Nazareth, in order to take advantage of the latent talent in the Israeli Arab tech community, according to Microsoft Israel R&D center director Yoram Yaacovi.

“With this program, we can bring that comfort and integration to the entrepreneurs in the community, thus making them – and Israeli Arabs in general – full-fledged members of the Start-Up Nation,” said Swidan. “When the first tech start-up gets funding, and even more so when the first Arab-led start-up has a big exit, even the doubters will be on board, I am sure.”

And it’s not just Arab entrepreneurs who will benefit, said Sella; Israeli tech, and Israel itself, will benefit. “2016 is the year of the Arab-Israeli entrepreneur. Business opportunity in this sector is ripe, in terms of the availability of unprecedented government assistance for initiatives from the Arab sector, increasing interest from the Israeli hi-tech ecosystem and its potential to serve as a bridge between Israeli tech and the Arab-speaking market worldwide.”

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