TEL AVIV: START-UP CENTRE
Like most great cities, Tel Aviv is constantly reinventing itself. Technology blended with the entrepreneurial spirit, an open mind, youthful energy and an irrepressible drive to create has led to the proliferation of hundreds of downtown technology start-ups. City Hall is lending a hand in turning Tel Aviv into “start-up central” on a global scale.
Last October, Tel Aviv played host to an international conference on urban creativity. Charged with the daunting task of cracking the code of innovation, the conference brought together city administrators, grassroots activists, designers, business people, artists and budding entrepreneurs in an exchange of experience and energy dedicated to unraveling the secrets of urban innovation. The conference/festival was organized by Tel Aviv Global City, whose ten-year mission is to enhance Tel Aviv’s stature as an international hub for business and culture.
The sense of celebration was just as much an integral part of the cities summit’s professional content. Urban innovation is not just about urban renewal. It shapes a city’s physical presence, its spirit and sense of community. In a corollary to the “if you build, they will come” theorem, Tel Aviv Mayor, Ron Huldai stated: “If a city is fun and the municipality doesn’t interfere, people will come and they will innovate.” Israel has long been a hotbed of technological start-up activity. Propelled by a vibrant VC community, vital elements in Israel’s growth and its global footprint have been technology start-ups, particularly of the information and communications variety.
Rothschild “Silicon” Boulevard, a short strip of tree-lined downtown Tel Aviv, has become a new hotspot of startup activity. Given the ample opportunities for work, study and play, Tel Aviv has been the Mecca for young Israelis for already more than two decades. High rents be damned, many have chosen to remain in the city well beyond their early twenties. The lure of the Mediterranean, the ability to continue to work and play next to home and the vibrancy of the city itself are what make Tel Aviv a preferred venue for many budding entrepreneurs.
At the same time, developments in key tech markets such as the surge in smart mobile, enable small innovative companies to develop amazing products and services without the need for large teams, big spaces or extensive infrastructure. Many of the current wave of Tel Aviv start-ups specialize in mobile apps and social media. Seasoned serial entrepreneur and Tel Aviv die-hard, Zev Laderman, describes the process of launching a tech company in Tel Aviv: “A start-up’s first office is typically the corner coffee shop. This is where much of the thinking takes place, initial contacts are made and work gets done. As things progress, the company moves into its first offices, which can be quite cozy, since the advent of cloud computing obviates the need for desktop computers, servers and most other office equipment.”
Newvem Analytics, a cloud analytics company launched by Laderman and Ilan Naslavsky in 2010 has recently taken residence in an apartment off Rothschild, only metres from Laderman’s home, after securing $4 million series A financing from Greylock Partners, Index Ventures and former Google CEO, Eric Schmidt’s Innovation Endeavors last May. The team continues to toil over a long table situated in the living room of the apartment.
Accelerating Launch Time
Other options are open to entrepreneurs looking for alternatives to the corner coffee shop, but not quite ready to take on a lease. Business accelerators which offer shared space, mentoring and other business development services have become an important part of the Tel Aviv tech ecosystem. They provide a vital link for embryonic startups in the long and winding road to product development and outside financing. For minimal cost, newbie entrepreneurs can rent space at an accelerator to develop products, hone business skills and, perhaps most importantly, to network.
Unlike the coffee shop, accelerators provide both formal and informal support systems. In addition to table space, Wi-Fi and all the caffeine you can handle, they provide an environment in which entrepreneurs can bounce ideas off each other as well as opportunities to foster ties to the tech and VC community at large.
Located in a high-rise office building in the heart of Tel Aviv’s financial district, TechLoft is one of Tel Aviv’s privately owned accelerators focusing on mobile and Internet startups. It was launched less than a year ago by Gilad Tuffias, an attorney specializing in business development, and Tal Marian, an electronics engineer. TechLoft provides its residents 24/7 work, conference and brainstorming facilities as well as an extensive range of services. Its mission: to enable embryonic start-ups to become investor-ready enterprises.
The Loft also organizes office hours with experienced entrepreneurs and facilitates hook-ups with potential angels, VC and strategic investors. Events, such as “Tech Tuesdays”, a lecture series addressing technological, legal and business issues, are held on TechLoft’s balcony. In keeping with their claim to being the coolest shared space in Tel Aviv, TechLoft hosts BBQ & beer nights to consolidate less formal ties. Tech Loft currently hosts some 50 entrepreneurs and there’s room for about 20 more. English is the language of choice and residency is open to non-Israeli as well as Israeli entrepreneurs.
Google Israel recently launched its own version of an accelerator. Google’s “Campus Tel Aviv” will be a one-floor workshop where Israel-based startups can work on their innovations with access to Google’s experts and a device lab comprised of tablets and smart phones on which entrepreneurs can give their apps a spin.
Enabling Start-up City
The Tel Aviv Municipality is particularly proactive when it comes to startups. Viewing them not only as a key to economic development but also as an integral part of what the city is all about, Tel Aviv Global City is going all out to promote the growth and sustainability of Tel Aviv’s technology eco-system and community.
Avner Warner is in charge of international economic development at Global City. His job is to make sure that the current wave of urban entrepreneurship becomes more than just a wave. He seeks to develop and lever Tel Aviv’s start-up eco-system of educational institutions, entrepreneurs, accelerators and investors to attract start-ups from abroad. “We are in the process of implementing a multifaceted program designed to attract not only Israeli, but foreign entrepreneurs as well. Together with the relevant governmental authorities, we are working on devising a special work visa for entrepreneurs which will enable them to reside and work in Israel for extended periods of time. We also plan to double the number of foreign students in Tel Aviv within five years by promoting special entrepreneurship courses and internships designed for an international student body.”
Tel Aviv Global City recently held the first “Tel Aviv Startup Biz Camp” for European entrepreneurs this past October. The program included instructional and networking sessions as well as visits to various early and later stage Israeli start-ups and participation in the Tel Aviv Digital-Life-Design (DLD) conference. The Municipality recognizes the existence of a well-integrated tech community as one of Tel Aviv’s major strengths and a potential source of competitive advantage when compared with other cities. Companies interested in exploring opportunities of setting up shop in Tel Aviv can contact Avner Warner at email@example.com.
Rewiring for Innovation
Municipal support extends beyond community outreach. City Hall is going the extra mile to provide the physical infrastructure for tech innovation. Last year it began rolling out free public access Wi-Fi on city streets and where it’s needed most… the beach. While the city does not particularly suffer from a lack of free Wi-Fi hotspots (back to the corner coffee shop), this municipal initiative renders Wi-Fi a public service, open to residents and visitors alike.
In addition, the Municipality is doing its part to provide accelerator services to pre-seed start-ups. In a flash of innovative thinking of its own, the Municipality has virtually reinvented the function of the public library. Tucked away on the 7th floor of the Shalom Tower, Israel’s first skyscraper, a once-abandoned public library, used primarily for storage at the time, underwent a facelift and today is a municipal library/tech accelerator. Story hour at the Library takes place alongside storyboard development; book borrowing alongside the sharing of ideas and know-how. Library residency is open to pre-seed (i.e. not yet funded) start-up teams comprised of Tel Aviv residents for whom the sharing of both space and ideas is not a problem.
Like the private accelerators, the Library provides workshops, networking events and other support systems for its residents. Unlike the private accelerators, however, residency is limited to three months. The Library opened its doors in October 2011 and is currently hosting its third round of residents. So far, some 25 start-ups have taken advantage of this facility. Recruiting for the next round is already under way. The Library also provides office and conference space services for foreign entrepreneurs visiting Tel Aviv. One can book work space for a day, week or month and conference room usage on an hourly basis. For more information, visit http://www.thelibrary.co.il.