Negev-based consortium helps war-hit startups reach US, Singapore and UAE markets
Synergy7, backed by the Israel Innovation Authority, Elbit and Dell, sets up an innovation hub in Beersheba to give businesses access to tech space and develop the country’s south
Israel’s 14-month war with the Hamas terror group has ignited anti-Israel sentiment around the world, triggered academic boycotts and halted service from foreign airlines. The impact has been especially felt by early-stage or young Israeli startups, which depend heavily on private investment, often from abroad, to secure their survival.
To help startups expand to overseas markets and attract investment — in particular those in the war-battered south of the country, which suffered heavy damage during and after the October 7, 2023, Hamas invasion — the Negev-based innovation center operator Synergy7 has embarked on a program to open business development offices in the US, Singapore and the UAE. The program is tailored for early-stage startups that have completed a funding round, have a product or service, and are ready to enter international markets.
“There is a raging war and Israel is on the news worldwide, for better or for worse, and we recognized that because of the [anti-Israel] sentiment, Israeli startups are [in a rut when it comes to] their international activities,” Synergy7 CEO Harel Ram told The Times of Israel. “If you add to that that there are almost no flights to and from Israel, the main artery of doing business with the world, it becomes harder and harder to do business and in particular early-stage startups are having problems breaking through the glass ceiling abroad.”
“Israel is a better site for developing new technology, but if Israeli startups can’t sell their products outside of the country such as in Europe and the US, they won’t survive,” Ram cautioned.
Backed by the Israel Innovation Authority, Synergy7 is a consortium jointly owned by Elbit Systems, Soroka Medical Center of the Clalit group, Ben-Gurion University of the Negev, BGN Technologies, Mor Research Applications and the Mirage Israel Fund. In addition, US tech giant Dell Technologies’ development center in Israel is a strategic partner of the consortium.
At Synergy7’s North American office in New York, Israeli representatives are assisting six Israeli startups in the areas of medical devices, medical data and cybersecurity with marketing and sales activities, business connections and investment fundraising.
“Mature companies have been able to get investment, but early-stage startups are in great danger and we are trying to help them with everything they need to survive,” said Ram. “We give them a hand when they need it, not necessarily when they already have sales but even at an earlier stage to ensure that they have enough funds for the development of their technology.”
Following the Hamas onslaught on southern communities on October 7, 2023, the Israeli army mobilized hundreds of thousands of reserve soldiers, including many who have founded startups or work in tech. They remain in uniform after more than 14 months of war.
The absence of personnel in the tech sector, the growth engine of the Israeli economy, has interrupted startups’ day-to-day operations, as well as their ability to attract foreign investors and raise funding.
Israel attracts most of its tech investments from abroad, with the US market representing the main market for expansion. About 80% of venture capital investments in local high-tech startups have been generated from foreign funds in recent years.
Ram, a veteran tech entrepreneur who lives in Omer, a suburb of the Negev city of Beersheba, said that Synergy7 is currently working on establishing a representation in Singapore to help Israeli startups expand to the Far East.
“The most challenging activity we are trying to do is to build a representation in the UAE, which is a hub for business development but has very complex business rules,” Ram said.
Before the outbreak of war, Synergy7 was focused on helping turn Beersheba into a hub for technological innovation and economic growth.
Founded in May 2023, Synergy7 was created to establish an R&D hub in Beersheba to bolster entrepreneurship and bring high-tech employment to the peripheral southern region. In March last year, Synergy7 won an NIS 25 million ($7 million) grant from the Israel Innovation Authority, to set up three R&D labs in Beersheba — a medical data lab with staff from Soroka Medical Center, a robotics lab with Elbit engineers and a cybersecurity lab with Dell engineers.
The three sites offer startups, entrepreneurs and growing high-tech companies R&D spaces to work on their ideas while developing Israel’s southern region.
“The concept was that the startup nation in Tel Aviv was something that needs to be expanded to the north and south to create an equal society, and we committed to bringing more startups and international companies to Beersheba to open branches in the area,” said Ram. “Then war broke out, and although we didn’t stop working even for a day, we realized that the landscape changed.”
“The funnel of new startups and deal flow shrank as it became harder for Israeli startups to expand outside the country,” said Ram. “We built the labs, but recognized that there is a problem in the business process.”
“At the end of the day, we will have an R&D arm and a business arm to work together for startups in the Negev,” he added.
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