START-UP NATION author Saul Singer (left) chats with Roee Oron of Tel Aviv’s SOSA work space yesterday..
(photo credit: MICHA LUBATON)
Italy’s economic powerhouse Enel, one of the world’s leading electricity producers, has opened its first Israeli innovation hub.
“We are condemned to innovate if we want to remain over the years,” ENEL CEO Francesco Starace said Monday at the swanky launch party and ribbon-cutting ceremony at Tel Aviv’s SOSA work space.
For the electricity producer, the largest by market capitalization in Europe, innovation is necessary to its growth strategy, not so it can compete with other utilities, but so it can compete with and integrate new sources of energy coming onto the market.
The company, based out of Rome, operates in more than 30 countries and has over 61 million customers worldwide.
The goal for the hub, Starace said, was “open innovation,” innovation that works to find new strategies instead of simply advancing strategies that are already in place.
The hub, the first in a series of planned innovation centers around the world, will aim to connect with 300 start-ups a year, and choose up to 20 of them for a sixmonth program. The accelerator, which will be run in association with the SOSA work space and The Junction accelerator, will provide mentorship, access to senior executives and opportunities to test new products.
They will also have a chance to receive follow-on funding from the Economy Ministry, which signed a deal with Enel to provide equal funding to select start-ups.
Enel’s hope is that three to five of the start-ups each year will become commercial companies that work in association with it.
“We wanted to create a physical space, a place that would bring together all the different people, the parties, the companies, to bring innovation and high-tech under one roof,” said Jonathan Saacks, a managing partner at Genesis Partners, an investor in The Junction.
Start-up Nation author Saul Singer, who spoke at the event, saw the hub as an example of a new mode of interaction between countries and businesses. Whereas traditional economic ties are based on trade, he offered, the new ones are based on extracting innovation.
“That new model is not trading partners, but innovation partners,” he said.
Israeli companies traditionally have viewed corporations such as Enel as sources of branding and distribution. But with the proliferation of startups, which are better at innovating and less adept at growing or scaling, the innovation itself becomes the product for corporations, which are good at scaling but have more trouble innovating.
“I think we need to think of corporates as a source of great problems,” Singer said, calling Israel a “solution factory.”
“Our problem is we don’t have enough problems, believe it or not,” he concluded.
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