Emirates or bust - Israeli entrepreneurs spend productive week in Dubai

A secret romance brewing for almost two decades behind closed doors was emerging into the spotlight.

Erel Margalit with the UAE Food Security Minister Mariam bint Mohammed Saeed Hareb Al Muhairi. (photo credit: ELAD GUTMAN)
Erel Margalit with the UAE Food Security Minister Mariam bint Mohammed Saeed Hareb Al Muhairi.
(photo credit: ELAD GUTMAN)
Save the date: A date-flavored start-up
Michal Drayman and Yehonatan Ben-Hamozeg recently found themselves speeding into the desert as part of a strange convoy. They left the splendor of Dubai and after an hour’s fast driving through the vacant expanses, they reached a date plantation of gigantic size. A broad, inviting carpet awaited them at the edge of the tract. Over it, an awning was stretched to protect guests from the blazing sun.
Drayman, a partner in Erel Margalit’s Jerusalem Venture Partners (JVP) venture capital fund, and Ben-Hamozeg, an Israeli foodtech entrepreneur, were at the center of a fantastical scene: in the middle of nowhere, a colorful carpet; parked alongside it, an impressive Bentley and a powerful Range Rover jeep. Their host clapped his hands and pots of strong Bedouin coffee and sweet tea appeared with a variety of snacks. A caravan of camels, guided by their riders, approached and passed silently by the carpet.
The host was husband to three. His first wife, the love of his life, was barren. The second was a daughter of the emir of Mecca. The third was from Malaysia. He lived a double life. Half the time he was a Bedouin in a white galabiya, growing dates in the desert, and the rest of the time he glided between London, Tokyo and the towers of splendid Dubai – all in private planes and Bentleys. The good life, Arabian Nights style.
The real stars of the event were the Hilwa dates the plantation grew. The two Israelis returned carrying several packages of the delicacy and passed them around to their band of fellow delegates. A flavor to die for. The Hilwa dates are staggeringly sweet, dripping with a honeyish nectar tasting like paradise. These are the dates that are sent to the emir of Mecca, brightening the days of those who perform Islam’s sacred tasks in Saudi Arabia. The world’s most delicious, most prestigious dates.
What search brought Ben-Hamozeg and Drayman to a remote date plantation in Dubai? The truth is, they weren’t searching. They’d been sought. It was all about the palm weevil, a red beetle known as the official nemesis of date palms and other palm trees the world over. It infiltrates the tree clandestinely, drills into it and lays eggs inside. The larvae from the eggs gnaw at the palm’s inner tissues and eventually the palm meets a rapid death. The hostile overthrow is efficient, quick and fatal.
This weevil, just 2 to 4 cm. in size, destroys astronomical quantities of date palms and other palms around the globe. A date palm yields between 80 and 200 kg of fruit per year. The loss from the mass palm-killing is enormous.
Countermeasures have not proven effective. They are costly and, environmentally, they generally do more harm than good. Sometimes intensive spraying is used, sometimes the irrigation water is laced with chemicals. Results are meager, the entire plantation and its area suffer and the environment pays a heavy price.
Now we come to Yehonatan Ben-Hamozeg.
Ben-Hamozeg founded a company for developing sensitive monitoring devices.
“One day,” he told me this week in Dubai, “Amnon Harari phoned me – a former head of Unit 8200 who’d founded an agricultural company called Adama. He said, ‘The time has come to stop spraying ourselves to death. You deal in sensors.
Let’s invent something that will help us substitute targeted defense for deadly spraying. The minute we can locate and identify the pest or the threat, we can zero in on it specifically.’”
THE PALM weevil destroys astronomical quantities of date palms (like this one) around the globe. (Pixabay)THE PALM weevil destroys astronomical quantities of date palms (like this one) around the globe. (Pixabay)
And so they did. Ben-Hamozeg’s company, Agrint, attacked the challenge by storm and overcame it.
“First, we got the weevil figured,” he relates. “Its characteristics, its abilities, its methods. Then we developed our sensor.”
The Agrint sensor costs the purchaser $12, but saves its owner a fortune. Screwed into the tree, it waits quietly for the weevil. It’s on alert. It belongs to an army stationed throughout the plantation, each in another tree.
The sensor knows how to pinpoint the exact moment when the weevil sets foot on the tree and the drilling starts. It’s there just to listen, and it hears; it can distinguish between the weevil’s drilling and other noises. The moment it detects the drilling, it passes the information to the cloud. All the sensors are connected to the cloud, and the cloud alerts the plantation’s owner by way of the owner’s application.
“Only if you detect the process at the beginning can you stop it – deal with the weevil and kill it while causing no harm and saving the tree,” says Ben-Hamozeg. Until now, a damaged tree couldn’t be identified until too late. Once the damage is visible, the tree can’t be saved. But now there’s an early-warning system.
Now imagine what such an invention does for the date farmers of Dubai. There are roughly 4 billion palm trees in the world, including roughly 150 million date palms. Almost one-third of the date palms (43 million) are in Dubai. Israel’s agricultural technology or agritech amounts to cheap, effective group life insurance for those tens of millions of trees. That’s the reason that Drayman’s and Ben-Hamozeg’s host was so enthusiastic. That’s the reason that the Emiratis – the citizens of Dubai, Abu Dhabi and the UAE – leapt at the delegation led this week by hi-tech entrepreneur Margalit, showing open enthusiasm but also an imposing level of practicality and professionalism.
“Let’s set up relations,” the host enthused to Drayman and Ben-Hamozeg, “and everything else will follow on its own.”
Hummus as a common denominator
Over the years, I’ve interviewed many Israeli hi-tech entrepreneurs and written more than a little about the wonders of the Start-Up Nation and that exceptional industry which for two decades now has been functioning as the tireless engine driving Israel’s economy. This week for the first time, I saw those people in action and up close.
If the Start-Up Nation is a separate kingdom in Israel, then Margalit is its crown prince. While Prime Minister Benjamin Netanyahu was instructing his ministers not to dare visit Dubai before he does, Margalit pulled together 13 CEOs from 13 companies out of the portfolio of JVP – the venture capital fund he founded to make the hi-tech desert of Jerusalem bloom, and which has since become an empire spanning nations and disciplines – and took them to Dubai. Three government ministers met him there. He was honored like royalty wherever he went.
The CEOs split up for meetings with their Emirati counterparts and attended official meet-ups between local and Israeli entrepreneurs, held in a natural, practical, happy spirit. A secret romance brewing for almost two decades behind closed doors was emerging into the spotlight with maturity, self-confidence and optimism.
To call the four days awaiting us in Dubai a “magic carpet ride” is a justifiable cliché. Margalit, perhaps the most painful lost opportunity for Israeli politics, was at his best. Dubai was made for him and events like this are his forte. He was in his element. He’s not innocent of self-glorification and also no small narcissist (a necessary factor for any would-be leader in politics or finance), but at least wherever economic and hi-tech entrepreneurship are concerned, Margalit comes by his self-admiration honestly.
He loves to speak, in polished English, but also knows how to listen. And more importantly, he knows the right time to listen. He can make an impression, but is also glad to be impressed. Although he’s already achieved his dream –  “Margalit Start-Up City” is alive and kicking and innovating in Jerusalem, Kiryat Shmona, Beersheba, New York and Europe’s splendid capitals – he still has a child’s enthusiasm. He’s lost no passion; rather, he pounces at every new idea as if it were the first of his life. He is excited by every initiative, captivated by every new horizon. He dives into every fresh start-up and finds himself up to his ears with it.
Margalit is the great romantic of Israeli hi-tech, and during those days in Dubai I secretly fantasized about how Israel would be handling the coronavirus if he were positioned as finance minister or higher. But since this column does not touch on science fiction, we now return to Dubai.
Another CEO in attendance there was Taly Nechushtan. Her company, Innovopro, has developed a way of producing concentrated protein (70%) from chickpeas. The global market is clamoring for non-meat-based proteins, and they need to be accessible, easy to prepare (Nechushtan’s protein is creamy-textured and convenient for cooking, baking, etc.), inexpensive and environmentally friendly. What could be more suitable than chickpeas?
In the hands of Innovopro, our familiar hummus – which, in the form we’re accustomed to, yields between 10% and 20% protein – can turn into a rich, accessible, tasty protein source.
“Our protein is concentrated. It doesn’t taste like hummus; the taste is neutral and so it can be added to almost any kind of food,” Nechushtan says.
The Emiratis are wild about the idea. They have good reason: in the Union of Arab Emirates, there is almost no agriculture (aside from dates). It’s a desert with an impossible climate – a land where water is scarce and any cultivation is very difficult.
The Emirates import almost everything – from wire to shoelaces, from wheat to meat, sugar and whatever else you can think of. When the coronavirus broke out, crisis hit the Emirates. Trade was paralyzed, airliners stayed parked, and the whole world stood around silently trying to figure out what was happening. The Emirates suddenly understood that they needed nutritional independence, so Margalit met with Mariam al-Muhairi, the minister of state for food security and one of the most talented women in the Emirates.
For coping with the situation, the method closest at hand is to direct all efforts at foodtech. To develop an independent capability for manufacturing proteins and other basic nutrients so that no circumstances can ever force the nation into mass hunger. Out of the entire Israeli delegation this week, Nechushtan was the most in demand, and she successfully recruited another strategic partner for her young hi-tech company.
“The bottom line is, we and the Emirates have a common language,” she told me, “both because we are from the same region and because we eat the same food. Hummus makes an excellent common denominator.”
A NEW fountain soars at the Palm Jumeirah in an attempt to break the Guinness World Record for the largest fountain, in Dubai on October 22. (Ahmed Jadallah/Reuters) A NEW fountain soars at the Palm Jumeirah in an attempt to break the Guinness World Record for the largest fountain, in Dubai on October 22. (Ahmed Jadallah/Reuters)
The citizens as partners in wealth
Dubai is unlike any other Arab state or city that I’ve visited before. I’ve walked around Cairo. I’ve visited Alexandria, Amman, Rabat, Marrakesh, Tunis, Ramallah, Aqaba and more. It’s not similar to them, not reminiscent of them, not in the same ballpark.
There aren’t enough words to describe the force of the surprise for an Israeli who, having developed a condescending attitude toward our Arab cousins, comes to Dubai for the first time. After the initial shock wears off, the tables turn. The locals are the ones who can feel condescending toward us, exactly the way the amazing towers of Dubai dwarf the Tel Aviv skyline.
“Know what the secret is here?” said David Meidan. He’s a senior Mossad official who opened the economic relations between Israel and the Emirates, and was with the delegation this week. “It’s simply that the place has management. The leadership here runs it in a clean, professional way. You see it everywhere. The residents have a real regard for the leaders. The state treats the citizens as partners in the wealth – and it works.”
But there are two classes here, I told him. There are the Emiratis, who number only 1.2 million, and there are 6 or 7 million foreign workers.
“True,” said Meidan, “and they come from India, Pakistan and all over the region, but notice that the foreign workers are also very content. They have rights, they’re paid well and they’re treated fairly.”
The founding father of the Emirates was Sheikh Zayed bin Sultan Al Nahyan. “Their Ben-Gurion,” Meidan calls him. Sheikh Zayed died some years ago and ruling the country today are the five sons born to him by Fatima, one of his wives. The emir had decided in advance which wife’s sons would take over, and they did. The five sons are known as “Bani Fatima.” One is the president and another is the famous Mohammed bin Zayed, known as MBZ, who is leading the normalization with Israel.
The country received independence from Britain 23 years after Israel. Al Nahyan united seven local tribes into a federation.
“His vision was simple,” says Meidan. “Tolerance, moderation, and compromise – plus enormous investment in education and in excellence. They identify the talented children at a young age and send them to study at the best schools in the world. They harvest the fruits, and keep planting more and investing more. It’s impossible not to be impressed.”
“Take the local minister for cyber security, Mohammad Al Kuwaiti,” he continues. “That man knows Israel like the palm of his hand. He has three degrees in computer engineering from the finest schools in the US. He’s a professional, uninfluenced by politics. All that interests him is cyber security and how to move the country ahead. Now compare that minister with our own minister for cyber security.”
It’s not just the cyber minister. All the management tasked with running the Emirates, from government ministers through the general managers and holders of key offices, are impressive people: professional, highly educated, dedicated to their work and occupied with it exclusively. The Emirati Ministry of Foreign Affairs is sophisticated, efficient, professional – and rated as one of the best in the world.
From a background interview I held with a senior official at the Foreign Ministry, I understood that everything I heard about these folks is true. The polished English, the amazing knowledge about the region’s mysteries and even Israeli matters, the clear view of the world, the practicality and kindness – they reminded me of everything that’s missing where we are (and no, I’m not blaming the Israeli Foreign Ministry, where there are wonderful diplomats serving, but only the hand that has brought it toward deprivation and death over the past decade).
Disneyland in a galabiya
The Emirates comprise an immense economic empire. The first encounter with the city takes your breath away. Think of Las Vegas with Disneyland mixed in. Add Manhattan and Shanghai, a pinch of Jericho and Aqaba, a scent of Switzerland and some London hype. Dress it all in a galabiya and the result is hard to describe.
The Emirates, having started from literally nothing, are competitive in the extreme. They insist that everything they have must be the biggest, strongest, most elegant, highest, the most that’s possible. They’ve built the world’s tallest building (Burj Khalifa), and it makes the Empire State Building look like Likud headquarters. Now the Saudis are building a taller one (nearly a kilometer high!), so the Emirates waited patiently until the Saudi building plan was complete and then immediately initiated a new taller building (to be completed within a few years).
They have the world’s biggest shopping mall (which takes a week just to stroll through), they have a real ski slope inside another mall, they’ve colonized the Guinness Book of Records in a thousand and one ways and contexts – and they’re enjoying every minute.
The roads are heavy with luxury cars, in numbers humbling Manhattan and Monte Carlo. On a tour we saw an especially grand building that looked like a cross between the front of Buckingham Palace and the Gardens of Versailles. It turned out to be the Police Academy. In Dubai, the police roll by in Lamborghinis and Aston Martins. This explains why Dubai is considered one of the world’s safest countries, with a minimal crime rate. What criminal could outrace those police cars?
Here, no one’s head turns at the sight of a Mercedes or BMW. Those are starter cars that you buy for your kids when they receive their driving license. There are Lamborghinis here, Porsches, Ferraris, Aston Martins, McLarens, Rolls Royces and other fabulous superbrands in limitless quantities. The real focus, one of the locals informed us, isn’t the type of car. What you look at is the number.
It turns out that in the Emirates, you purchase a license number for your car and you keep the number for car after car through your lifetime. The number indicates how rich the owner is. A number of five digits or more costs a pretty penny, but within reason. A four-digit number costs hundreds of thousands of dollars. A three-digit number costs millions. A two-digit number costs tens of millions. No one agreed to tell us how much a one-digit number costs. “You can drive a beat-up old Toyota and it doesn’t matter,” our guide explained. “If you have a three-digit number, you’ll still receive every ounce of respect.”
The first Israeli to visit the Emirates was Mossad director Efraim Halevy, back in the 1970s. After him came others, and relations have become steadily closer. In the past decade, there was a significant leap forward. Israeli businesspeople turned Dubai into a second home. Relations flourished, but under cover. Netanyahu, and for this he deserves great kudos, brought them into the light.
Now everyone is blinking in the dazzle. The concubine has become an official wife (and by concubine I mean Israel). Now comes the wedding, and it must be hoped that the married couple will find its way around the land mines that are waiting on the road to establishing a family. The first will be the trauma for the Emiratis when they meet Israeli tourists after coronavirus passes and direct flights begin. Due sympathy may be extended in advance.
Dubai is a colossal trading state.
“They reach 3 billion people,” Margalit told me. “They’re an arm’s length from India, they’re close to China, they trade with everybody – bridging from Africa to Asia to the Far East to wherever you want. When we come here, we’re not coming just to Dubai. We’re actually coming to the whole planet. They can connect us to places we never dreamed of reaching.”
And on this visit, that’s exactly what he was working on.
A fascinating country sprang up in the middle of the desert. Dubai has the world’s largest seaport (Jebel Ali), the world’s most prodigious desalination plants, the world’s most impressive towers, a gigantic aluminum industry and R&D centers on par with Silicon Valley. Development centers of every technological giant are there. The level of education is very high. The women among the entrepreneurs number more than 50%. The number of women in central government positions is also impressive.
For all that, not everything is perfect. Dubai is open, modern and tolerant, but still won’t permit a woman to enter a taxi alone. And it still allows polygamy. There’s some distance to go, but the road traveled thus far is incredible.
During four days in Dubai, we couldn’t see a single cigarette butt or fallen leaf on the sidewalk. No one dreamed of removing the mask from their mouth and nose for even a second. Everything was orderly, squeaky clean, organized and polite. A sort of paradise had sprouted in the middle of the desert, almost overnight. The city itself is full of activity, sites, monuments and attractions of the finest kind. The markets are efficient, the mosques are gracious, and everything is shipshape, radiating quiet power and comfortable quiet.
On Monday we toured the fragrance market and the gold market, a group of five Israeli journalists. Tourism had halted because of the coronavirus, and we were almost the only customers.
“I’ve just realized,” one of us said, “that for the first time ever we’re walking around a marketplace in an Arab country, speaking Hebrew right out loud, not hiding our identity, not minimizing our presence – maybe even the opposite.”
It was true. Most of the salespeople weren’t Emirati citizens; they were Indians, Pakistanis, Afghans and so on. They didn’t care who the tourist was as he passed along the alleys. They cared only about how much he was willing to buy. The feeling of security was total. It might have been illusory, but it was very forceful. One can only pray that when the polite Emiratis, with their almost European restraint, meet the swarms of Israeli tourists who will descend upon the sites of the city some time in the coming months, all goes well.
JVP FOUNDER Erel Margalit with the Israeli delegation of 13 CEOs. (Alon Gutman)JVP FOUNDER Erel Margalit with the Israeli delegation of 13 CEOs. (Alon Gutman)
The balance point
Sultan Ahmed bin Sulayem is worth around $25 billion. He is chairman and CEO of DP World, a company he built with his own hands. His first job was as a customs official in the sleepy port of Dubai. Today he controls 10% of the world’s entire container-based marine traffic as owner of dozens of seaports, including the world’s largest (which is in Dubai) and many other ports in the US, Europe, Africa and Asia. He is an impressive, restrained, quiet man with a great affinity for Israel.
Bin Sulayem’s name figured in our own headlines when it emerged that he wanted to buy Haifa Port. As simple as that. For the purpose, he joined up with Shlomi Fogel and his partners from Israel Shipyards Ltd. It was a clever move, given Fogel’s closeness to Netanyahu. Haifa Port is puny in comparison to the other ports in Bin Sulayem’s empire, but the man knows what he’s doing.
“Haifa Port will save me the transport of millions of containers around the Arabian Peninsula or the Horn of Africa,” Fogel told someone in a private conversation. “We’ll move the containers overland from Basra across Jordan to Haifa and from there over the Mediterranean to Europe.” A winning move indeed.
I have no idea whether he’ll succeed in buying Haifa Port (although I imagine the military infrastructures would fall outside the purchase and the country would retain a golden share), but if it happens, it will be good news.
That week, Bin Sulayem sat down for breakfast with Margalit. It wasn’t their final meeting, and it wasn’t their first. He’s trying to interest Margalit in the construction of a start-up city on Bin Sulayem’s territory, in a free trade zone. It emerges that Bin Sulayem has a free trade zone in Dubai and 8,000 companies operate there. The man does his work modestly; he stays out of the spotlight and the headlines, but the financial empire he’s built is one of the world’s most powerful.
He knows many Israelis. He does more than a little business with some of them, and he’s a great admirer of Israeli initiative, vision and ability. When he explains how he turned Dubai into the colossal crossroads of trade that it is today, and how almost all the countries in East Asia, China, Africa and part of Europe are using the Emirates’ trading facilities and being drawn to Dubai like moths to a flame, it’s impossible not to understand.
As a hobby, Bin Sulayem purchased 10 of the famous artificial World Islands the Emirates built in the shape of a world map. His islands are the ones that form the shape of South America, and they’re named appropriately. On those Islands, he built himself a private retreat with no excessive opulence. Sitting there, he can see the Dubai horizon laid forth before him, with the radiance of its night sky, while at his back, within reach of him, are Iran, Oman and other countries.
Within that scene, the whole secret is contained: Dubai is located centrally, at the Archimedean balance point of the world’s most dangerous, schismatic and quarrelsome area. It has managed to leverage its strategic location with perfection. Now it is opening up, at least officially, to us as well. The forbidden liaison is meeting the light of day. This is a once-in-a century economic opportunity.
As a new era dawns, the questions remain: Will Israel rise to the challenge? Will it be wise enough to avoid antagonism and build true partnership across such a distance?