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Jewish Journal

Book on Israeli start-ups bolsters Israel’s image

By Uriel Heilman, JTA

March 18, 2010 | 10:59 am

When Intel’s Israeli division proposed a new strategy to vastly improve the processing speed of the company’s laptop computer chips, Intel’s U.S. management had no interest.

The idea required a fundamental change in Intel’s technological approach, which had been to build what were known as faster “clock speeds”—essentially, faster “engines”—to accelerate processing. Israel’s division proposed to run the engine of the chip slower, but to gain even more power by configuring a system that used gears like a car.

The project was mothballed.

But exercising typical Israeli chutzpah, the Israelis were persistent in advocating their out-of-the-box solution. They traveled back and forth to Santa Clara, Calif., incessantly pressing their case to Intel’s higher-ups. Staying the course, they argued, was riskier for the company than adopting the paradigmatic changes they were proposing.

Eventually the Americans caved.

Upon its release in March 2003, the new Centrino chip was widely hailed as an important innovation and became the basis for Intel’s edge in faster and more powerful chips. Originally code-named for a spring in northern Israel, the program eventually became known in the industry as “the right turn.”

The anecdote is one of dozens of stories recounted in “Start-Up Nation,” a book by Israeli journalist Saul Singer and former U.S. foreign policy adviser Dan Senor that seeks to unpack the ingredients for Israel’s extraordinary success in innovation and entrepreneurship.

Since its release last November by the Council on Foreign Relations, where Senor is an adjunct senior fellow for Middle East studies, “Start-Up Nation” has garnered widespread attention and prompted a rare wave of unabashed praise for Israel. Journalists, pundits, business leaders and policymakers have cited the Jewish state as a model for emulation.

In an uncommon case of good public relations for Israel, the book has helped generate discussions about what Israel is doing right in media more often focused on what’s going wrong in Israel.

“Start-Up Nation” has reached the best-seller lists of The New York Times, The Wall Street Journal and The Washington Post, spurred Op-Eds in Newsweek, the Times, Forbes and CNN, and been covered in numerous other news outlets. Prime Minister Benjamin Netanyahu singled out the book for praise in a speech a few months ago, it has become a best-seller in Singapore and it was a centerpiece of a recent half-hour feature on the Israeli economy by Germany’s leading TV network, ARD. The book is being translated into Chinese, Russian and Hebrew.

At a time when Israel is trying with limited success to rebrand itself beyond the conflict, the book promotes a positive view of Israel without wishing the conflict away. On the contrary, the conflict is cast as part and parcel of the reasons for Israel’s success.

The relatively non-hierarchical nature of the Israel Defense Forces, and the leadership skills and maturity the army develops among its young soldiers, are important factors in fostering Israeli entrepreneurship, the authors write. The adversity Israel faces surrounded by hostile forces is cited as a reason for Israeli inventiveness. The perils of investing in a country seemingly always on the verge of war spurs Israelis to go the extra length to show foreign financiers that Israel is a smart place to invest and build.

Singer, a columnist for The Jerusalem Post, said the phenomenon of the book’s success has been uplifting.

“People are tired of looking at Israel just as a conflict,” he told JTA. “They find it refreshing to hear about a completely different side of Israel.”

His co-author, Senor, a private equity executive who served as a Defense Department adviser in the last Bush administration and is married to CNN anchorwoman Campbell Brown, is considering running as a Republican candidate for the U.S. Senate seat now held by Sen. Kirsten Gillibrand (D-N.Y.). Senor reportedly is expected to announce his decision in the next few days.

Singer said the pair did not write the book to bolster Israel’s public image but to tell a story about a real success.

“This is the first book to look at an entire side of Israel that no one has paid attention to previously,” he said from Jerusalem. “It’s a huge story that’s essentially been missed with thousands of correspondents here.”

“Start-Up Nation” considers what elements of Israeli culture make it an ideal incubator for innovation and entrepreneurship. In the process, the book tells the stories of myriad Israeli companies and connects their successes to some quintessential elements of Israeli society: its small size, dearth of natural resources, ubiquitous army service and, of course, the common national traits of chutzpah, informality and persistence.

Israeli qualities that in some circumstances might be considered shortcomings, the authors find, are essential ingredients for entrepreneurial success.

On Israeli unruliness: Mooly Eden, who runs Intel’s cross-cultural seminars to bridge gaps between the company’s Israeli and American workers, tells the authors, “Israelis do not have a very disciplined culture. From the age of zero we are educated to challenge the obvious, ask questions, debate everything, innovate.”

On Israeli impetuousness: Mark Gerson, an American investor in Israeli start-ups, says that “When an Israeli man wants to date a woman, he asks her out that night. When an Israeli entrepreneur has a business idea, he will start it that week. The notion that one should accumulate credentials before launching a venture simply does not exist. This is actually good in business. Too much time can only teach you what can go wrong, not what could be transformative.”

On the lack of natural resources in Israel, Harvard professor Rocardo Hausmann tells the authors, “What’s striking about Israel is the penchant for taking problems—like the lack of water—and turning them into assets—in this case by becoming leaders in the fields of desert agriculture, drip irrigation and desalination.”

Having immigrated to Israel 15 years ago from New York, Singer said the book never occurred to him until Senor, who lives in the United States but travels frequently to Israel for business, approached him with the idea.

“When you’re looking from the inside, you tend to look at problems and tend to complain,” Singer said. “When you’re looking at Israel from the outside, you see how amazing it is. We need to appreciate what we’re good at and how important it is.”

Read more on Israeli healthcare startups here.

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