Business Opportunities Gateway Forum Electrical Power and Energy July 20 – 22, 2016, Vilnius Grand Resort, Lithuania
Israel Start-up Nation Mr. Elisha Yanay,
Chairman of the Israeli Association of Electronics and Software Industries, Chairman of Beeper Communication Ex S.V.P Motorola Inc.
Israel 2015 • Population: 8.13 M • Households: 2.16 M • Urban Population: 94% • Area - grand total 22,145 sq. km • GDP: US $ ~ 302 • GDP Per Capita: US $ ~ 36.9
31,806 28,999 26,986
24,847 22,846 20,600 18,700 16,700
21,258
23,470
25,490
Electronics Industry & Software International & Local Revenue (millions $) 50$B 29,467
4,125
27,000 25,606
20,600
24,745
22,856
7,800
21,481
15,500
2012 2013 2014
World Leadership in Civilian R&D Investments
Source: OECD, Israeli CBS
Distribution of Student in Israel per year ~ 20,000 Other
~
~ 120,000 ~
? 5 UNITS MATH
7-10%
4 UNITS MATH
? 20-30%
3 UNITS MATH
?
Global Macro Economics Data
80T 50T 30T 6T 3.5T 2T 2T 3T 1T 13.5T
High Tech 7% 6000B 0.8T 0.9 T 0.4T
W.W.GDP 80T W.W 16.5T USA 11T China 5T Japan 3.5T Germany EU 16T 0.33T Israel
W.W.GDP 100% Local GDP 70% 30% Industrial GDP 10% 32B High-Tech Oil Automotive Health Care 32B/6000B=0.5% Finance Military Others
World Leadership in Civilian R&D Investments
Source: OECD, Israeli CBS
The Challenges
$8,6T $5T $2,7T
2020
2003
$11B
$26B
$40B
2020
2003
We have the human resources necessary 2003
2014
2020
High Tech
GDP
Year
6.5 B$
$ 19,307
1996
29.5 B$
$ 37,200
2014
453%
193%
Education 2000 (1996 program) The best For High tech
Government Budget
The Telecom Show The Russian Immigrants/ Software
Higher Education in Israel Electrical & Computer Engineering & Computer Science Academic Year
Number of 1st Year Students
Number of Graduates
Retraining
Until 1994
1,200
1,000
1998
4,860
2,280
3,905
1999
5,800
2,500
2000
6,653
2001
% of Universities 1st Year Students
% of Colleges 1st Year Students
100%
0%
6,185
73%
27%
4,870
7,370
62%
38%
4,040
5,238
9,278
54%
46%
8,030
4,300
3,970
8,270
45%
55%
2002
8,000
5,000
3,475
8,475
2006++
8,000++
~8,000
46%
54%
21,458
Total
The Start UP Nation
Israel’s Multi-sector Innovation WATER TECHNOLOGIES 250 innovative companies
Water management
AGRICULTURE 200 innovative companies
Fertilizer and pesticides
Seeds and seedling production Water desalination
Irrigation
Urban water solutions
HEALTH & LIFE SCIENCES 1,000 innovative companies
Digital Imaging Innovative medical and surgical equipment
NEW MEDIA AND INTERNET 1500 innovative companies
Specialized agricultural production equipment
Veterinary products and food additives
Healthcare IT and Telemedicine Medical Lasers Bio-informatics
350 innovative companies
Media, publishing, content and gaming
Securing networks, cloud and devices
Online advertising And commerce
Information Security and threat Monitoring & protection
Broadcast delivery and services
Fraud Detection & prevention and Security Management
Big data & analytics
Access Control & Authentication
Tools, apps and user platforms
Intelligence and Attack
Pharma and drug delivery Poultry and dairy farming technologies
CYBER-SECURITY
Active High-Tech Companies Number of active high-tech companies is constantly rising new startups per 884 year on average ratio in favor of 2:1 new startups By the end of 2016 there will be about 7,600 companies
• 8000
7298 7371 6781
7000 6285 5902
6000
• 5000 4139
•
4000
4428
4721
5006
5347
3781
3000
• 2000 1000 0 2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Active Companies Source: IVC-Online Research
Technology Companies High Tech Companies
Multinational Corporations
7,053 Active Israeli high-tech companies
321 Active foreign R&D centers
375 Active Israel-related companies
Startups Established By Sector The Internet, • Communications, and IT & Enterprise Software are the leading sectors The most popular sub- • sectors among those three leading sectors are Internet Applications, Mobile Applications and Enterprise Applications respectively Cleantech, life sciences • and semiconductors sectors are constantly shrinking
100% 90% 80%
22% 25% 21%
23% 21%
70% 60%
50%
25% 25%
20%
20% 10%
25% 17%
20%
16% 12%
16%
11% 13% 10% 14% 12% 14%
20%
17% 18% 20% 20% 25%
33%
40% 30%
17% 16%
18%
30% 33% 25%
33%
31%
29% 34%
28%
6%
15% 17% 20%
21%
26% 24% 28% 28%
22%
0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Cleantech Internet Life Sciences Semiconductors
Communications IT & Enterprise Software Miscellaneous Technologies Source: IVC-Online Research
Capital Raised by Israeli VC Funds $B $B
4.9
4.0
3.5
3.4 2.7
3.0
2.7
2.5
2.5
2.0
1.9
1.5
2.9
1.0 1.4
0.4 0.3
0.1
Cycles:
I
0.5
0.8
II
1.4
1.5
1.3 0.5
III
0.1
0.8
0.6
0.8
1.2
0.9
0.9 0.2
IV
V
0.0
1
0.9
0.5
0.4 0.0
VI
VII
Source: IVC-Online Research
ISRAEL Electronics & Software Industry
2015
Israel High-tech International Revenues by region 2015
Israeli High-Tech Companies by Product
Multinationals | Operate by Local Subsidiaries or Manage R&D Centers in Israel Telecom
New Media
Software
Electronics Life Science Medical Dev. Life Science Bio & Pharma
Some of Israel’s Visible Companies
41
Major Multinational Companies with a Design Centers in Israel
Bill Gates, the Microsoft CEO, made his first trek to Israel
“Considering the density of Israeli startups and local successes, Israel is like a bit of Silicon Valley”.
CRAIG BART: former Intel CEO (visiting Israel)
“Apart from the 6,000 jobs that we have provided here, in my opinion the contribution to Israel lies in the fact that Intel has attracted other companies to invest in Israel and to create an entrepreneurial environment. Globally speaking, Israel is in 3rd place in terms of IP and is a very good place for opening businesses. The level of education in Israel has helped us expand. Israel’s ability to supply very good scientists has helped us, and the government’s positive attitude has helped us attract investments.”
Asked how come he chose Israel as his first investment outside America, Buffett's response was: "Some Americans came looking for oil, so they didn't stop in Israel. We came looking for brains, so we did stop in Israel."
Challenges • Labor productivity is low in non-traded • Low employment and high poverty among Ultraorthodox and Arabs (low skilled) • Invest in productive human capital • Active employment policy
• Education Quality and human capital employment skills • Peace and the economy
Thank you
