Congressman: US should follow Israeli lead in hi-tech support

Akron, Ohio group to invest in Netanya-based incubator.

senate 88 (photo credit: )
senate 88
(photo credit: )
US Congressman Tim Ryan had never been to Israel until he arrived on Sunday. Now, after just a few days of observing the country's hi-tech sector, he is considering introducing initiatives in Congress to force the US government to imitate its Israeli counterpart in the provision of support for start-up companies. "In the US we are sometimes very short-sighted in the investments we make and we can learn from what goes on in Israel," Ryan said in an interview with The Jerusalem Post. The Democrat, who represents Ohio's 17th District, is in Israel at the head of a delegation of businessman and public officials from the city of Akron, which is located in the northeastern part of the state. "I like the focus on the incubator and the way in the early 1990s they structured the VC system…to create centers for entrepreneurs. That's a very unique structure," he said. Akron Mayor Don Plusquellic, who also is leading the delegation, is impressed with the Israeli model, as well. "You have a high level of support from the government, which provides a lot of money," he said. Ryan, however, declined to specify the measures he would introduce, saying it was too early to detail them. "Whatever it is, Israel will be the model we use. I want to get a better understanding of how the whole VC system was put together. At this stage it sounds like the country said it wanted to put together a VC system and went ahead and did it," he said The Israeli government has a variety of domestic and international programs whereby it provides financial and professional assistance to hi-tech companies via the office of the chief scientist, which has an annual budget of NIS 1.2 billion. In addition, the government last month said it plans to allocate NIS 1b. to private equity funds and to lighten the regulations for institutional investors to fund research and development. Plusquellic, who called the mission "very, very successful" at a reception at the residence of the US Ambassador Richard H. Jones, was due to sign a memorandum of understanding Thursday night with an unnamed Netanya-based Israeli incubator under which the City of Akron would provide support services for start-ups that are leaving the incubator and want to enter the US market. "We can help provide assistance and get companies more quickly into the US than they otherwise would have been able to on their own," said Plusquellic. The city is also putting together a public-private partnership that will invest a minimum of $1 million in the incubator, said Howard Gudell, president of the Ohio-Israel Chamber of Commerce. "This is the first time a US city is investing in an Israeli incubator," he said. Gudell added that a bilateral steering committee has been set up comprising the Israel Export Institute, the Israel Life Sciences Association and Israeli biotech companies, as well as Akron's general and children's hospitals, Summa Healthcare System and biotechnology accelerator Bio-enterprise. "The purpose is to promote a pipeline of Israeli companies that can be commercialized in the US," Gudell said. The delegation has 31 participants representing 27 companies and public organizations, such as Akron General Health System, Bridgestone Americas and the University of Akron. They have held about 150 meetings with 60 Israeli companies, including DB Motion, which creates technology that allows healthcare organizations to securely share medical information, and Carmel Olefins, a producer of raw materials for the plastics. "There is already significant progress with companies doing business with each other," Gudell added. While the Americans have been positive about their visit, the feelings are mutual, said the Israel Export Institute's Rachella Weinstock. "The Israeli companies were very satisfied from the meetings we helped set up," she noted.