When Greg Moran, CEO of Zoomcar, first traveled to Israel last year, he was expecting to have a few business conversations–maybe even to collaborate on a low-level project. His firm, India’s first and largest self-drive car rental service, had been in operation for three years and active in over a dozen Indian cities. He wasn’t expecting what came next.
Zoomcar had investment from OurCrowd, Jerusalem’s leading equity crowdfund. The latter facilitated a meeting between Moran and leaders at driver assistance giant Mobileye.
Now Moran and co are working with Mobileye on “a very innovative solution in India to push scale by 50%–probably even more,” said Moran. Mobileye’s accident-preventing tech is now present in over 10,000 Zoomcar vehicles.
Zoomcar is just one of a host of corporate-startup relationships being founded in Israel, as the company’s tech and funding markets go from strength to strength. Moran was speaking at the OurCrowd Summit in Jerusalem last week, which has become one of the country’s foremost tech conferences. There, he and others spoke about the growing crossovers between multinationals and innovative startups in Israel.
Matteo Shapira is CTO and co-founder of Replay Technologies, a 360-degree camera technology provider that won plenty of attention at this year’s Super Bowl, when its tech was used to create audience-pleasing replays including a ‘Be The Player’ cam.
By then Shapira and his Tel Aviv/California-based team had already won the affections of Intel through OurCrowd, which acquired the company last March.
It was a dream match-up from the start, said Shapira: “The future of 3D video is volumetric, that video is going to be truly three-dimensional, and we will be immersed in pre-captured and live-captured events, and we’ve set a goal to improve that in sports.
“And during our amazing trip with multiple league and big corporate collaborations with Intel of course, but also Sony and Microsoft, we struck up a partnership with Intel,” he added.
Replay Technologies has now leveraged its corporate partnership to become a key part of Intel Sports Group. It is part of a long line of cooperation between Intel and Israel, which began when it opened its first foreign design center in the Middle Eastern state, in 1974.
“Our goal in the last few years has been to identify new and potentially disruptive technologies that we often find in seed-fun startups,” said Joel Fisch, director, technology collaborations at Intel Sports Group. “With Replay it did not start as an acquisition. It started out two years ago as a very small technology collaboration.
“This was a team that was able to have a conversation with us about any technology or system,” he added. “And that’s really key for us and our capability. We have this real virtuous cycle of entrepreneurship, and big and small companies.”
Corporate hookups with startups don’t always go well. But as Israel’s tech industry matures, and collaboration between bigger and smaller firms becomes more organic, the ‘Silicon Wadi’ is providing fertile ground for relationships to flourish.
The tech sector now employs around a quarter of the entire Israeli workforce: its moniker as the ‘Startup Nation’ has been well-earned. And now a second generation of larger, and more boutique, investors are entering the fray.
US states have also jumped aboard the Israeli tech bandwagon. A delegation from Massachusetts to the summit represented the fact that Israeli-founded companies in the greater Boston area are now worth $8bn, or 3.8% of the state’s GDP. The Israel-Cincinnati Innovation Venture, established last year, also aims to connect large firms with agile, startup counterparts.
The World Economic Forum recently ranked Israel the world’s second most innovation country behind Switzerland. That is no accident given the country’s dedication to ploughing public money into tech.
“Taxpayers’ money should go to the riskiest areas of the industry,” Nir Hasson, the country’s top scientist, told Red Herring. His Israel Innovation Authority (IIA) recently launched Technological Labs Innovation, a program to encourage corporates to support startups in their respective fields.
Many small firms have thrived first on public or crowdfund money, then continued to win the affections of huge multinationals. VocalZoom is a voice recognition firm based in Yokneam Illit, in the north of Israel. Last year it announced a partnership with automaker Honda, again after a conversation mediated by OurCrowd.
It was an immediate fit, said CEO Tal Bakish: “Honda was the first one to actually bring the partners into the project and build an end-to-end solution in order to show to Honda stakeholders and decision-makers that the technology actually works.”
“The second thing was introducing together at CES, Honda put us in the centre of the booth,” he said. “And that gave tremendous publicity, and the effect was amazing both for investors and other customers. I think Honda did the right thing here because, at the end of the day, it gave Honda the market validation they need that this technology is interesting, and that it will give them more options.”
Bakish is in no doubt that Israel’s reputation is going before it, in terms of attracting money from corporate players today. “In terms of execution, there is a very good perception of companies from Israel,” he said. “When you approach customers or partners who need you to be very close to the market then it’s a little bit of a disadvantage because the markets are in China and the US.
“But for a component company the market is less important than the innovation and the execution. And this is something we have very good experience of here in Israel.”