Israeli Arabs, though comprising only 17.5% of the country's population, are quickly integrating into the hi-tech sector, boosting the economy.
By SHLOMO MAITALUpdated: DECEMBER 23, 2017 18:12The Church of the Annunciation is seen through the office window of Jamil Mazzawi, founder and CEO of Optima Design Automation, as he works at the Business Incubator Center in Nazareth(photo credit: REUTERS/NIR ELIAS)
Thanks to hi-tech veterans young and old and government ministries, partnering with Arab counterparts, more and more Israeli Arabs are becoming entrepreneurs and hi-tech workers – and that can only bring good things to Israel and the world.The numbers tell the story Some 3.5% of software developers active in Israel today are Israeli Arabs. Eight years ago, only 0.5% were Arab. In Nazareth alone, some 1,000 Arab engineers are employed, compared with only 30 in 2007. There are some 50 Arab start-ups in Nazareth; just a few years ago, there were none. Amdocs, a global Israeli hi-tech software firm, now employs 200 people in its Nazareth office.There is of course much room for improvement.Overall, Arabs comprise a fifth of Israel’s population and 17.4% of its workforce.But a Finance Ministry study published in August showed that only 1.4% of lucrative hi-tech jobs are held by Israeli Arabs. Only 30% of Arabs who study technology find work in hi-tech. And 59% of Israeli Arabs studying technology drop out before completing their studies, according to the Finance Ministry study.Many Israeli Arabs choose to become pharmacists or doctors, as niche professions that offer remunerative employment. Fully a third of all Israeli pharmacists come from the Arab sector. But until recently hi-tech has not been hospitable to them.Six years ago, I wrote in The Jerusalem Report (“Imad Telhami shows what counts,” January 3, 2011) about a 51-year-old Christian Arab entrepreneur and how he launched Babcom, based in the Galilee, which employs hundreds of Arabs and Jews. Babcom provides call-center services (to Cellcom, among others), software development and other solutions. At the time Telhami was almost unique. Today he has many counterparts.Since that time, I have tried to follow closely the remarkable rise of the Arab Startup Nation (see The Report, “Silicon Nazareth,” September 7, 2015).How did the rise of Arab start-ups and hi-tech engineers happen? A number of hi-tech veterans saw the need, partnered with the government and Arab counterparts and used their innovative skills to advance entrepreneurship among Arabs in the Galilee and elsewhere.The government has played a major role.The Innovation Authority, formerly the Office of the Chief Scientist, offers grants of up to 85% and up to 2 million shekels, for start-ups where at least a third of the founders are Arabs. This is much more than the 50% given to standard companies. These funds are available to Haredi and other disadvantaged communities as well.I spoke with David (Dadi) Perlmutter, who rose to become No. 2 to Intel’s global CEO before he retired in 2013. Perlmutter serves as co-chair of the public council of Tsofen.“Tsofen was created jointly by Arabs and Jews with the vision to integrate more and more highly capable Arab engineers into Israeli tech companies and take part in the creation and growth of the Start-up Nation,” Perlmutter told me. “Tsofen connects Arab engineers with hi-tech Israeli companies and creates ecosystems to promote entrepreneurship in the Arab community. Tsofen brings hi-tech into Arab cities like Nazareth and Kafr Kassem.”I asked him why it is so important to integrate Arabs in hi-tech.“Higher paid jobs improve the Arab sector in the economy,” he answered, “and supply more capable engineers to Israeli hi-tech, which needs resources to maintain its growth. Last but not least, it improves the economy by supporting the fastest-growing sector.”Tsofen runs courses on entrepreneurship for Israeli Arabs. According to the website Geektime.com, “Ahmed Hakroosh from Kafr Kana, near Nazareth, one of the participants in the entrepreneurship program, sees the networking that the course facilitates as an essential part of his own growth, noting that ‘by being able to network here with people, I can get more inspiration and ideas. It’s a chance to meet people who have the same need and at the same time who have different ideas. Beyond the important practical tools, there is a rare chance for people who take part to increase their chances for success in the future.’” Networking plays a crucial role in launching start-ups. By integrating Israeli Arabs into the local hi-tech network, they are given a major boost.Arab women are not forgotten, either. I was happy to learn that Maria Khalaf, a software engineer, Technion alum and an Israeli Christian Arab, was a participant in the entrepreneurship course. She told Geektime, “I’m here to learn practical things like how to write a business plan. It’s one of those things that in theory are easy but we need help from somebody who has already done it.”I came to know Maria well when in 2011 she joined a group of Israeli Jewish and Arab students and a group of Palestinians from East Jerusalem to study entrepreneurship at Babson College, near Boston. In this seven-week program, Jews and Arabs worked together on start-up ideas and wrote business plans. Maria was a standout.Last year, Tsofen launched a new project called TRI/O Tech that sponsors an entrepreneurship course and a start-up ventures accelerator to advance hi-tech and entrepreneurship projects in Kafr Kassem. The US State Department’s Middle East Partnership Initiative provided some funds, as did the Glazer Family Fund and the Portland Trust.Kafr Kassem is an Arab city of some 25,000 about 40 minutes northeast of Tel Aviv, straddling the Green Line (1967 border).For many Israelis, the name Kafr Kassem conjures up memories of a terrible massacre.On October 29, 1956, the first day of the Sinai Campaign, the Israel Border Police killed 49 civilians, the result of a tragic misunderstanding over a curfew order. Perhaps the city’s hi-tech ventures will mitigate the terrible memories of that fateful day.I spoke with Fadi Swidan, who co-founded Hybrid, an accelerator that promotes start-ups in the Nazareth Business Incubator Center (NBIC), launched by the Ministry of Economy and Industry, in cooperation with the 8200 Alumni Association. (8200 is the name of a hi-tech unit in Israel’s military intelligence and a ‘school’ for many of Israel’s future entrepreneurs.) Swidan has a degree in industrial engineering from Technion-Israel Institute of Technology and an MBA from Clark University, in Worcester, Massachusetts.Hybrid is the leading accelerator in Israel for early-stage start-ups led or co-led by an Arab founder. The name, Hybrid, stems from its being in Tel Aviv and Nazareth at the same time, as well as from its Arab-Jewish mix.Swidan’s diagnosis of the core problem? “In the Arab sector, we have talented entrepreneurs but they lack business know-how, networks and connections,” he said. Hybrid, Tsofen, TRI/O and other ventures help to remedy that.Oren Gavriely is a young hi-tech entrepreneur and Technion alumnus who lives in a small Galilee moshav, Yaad. He has invested years of effort in fostering Arab entrepreneurship.He told me, “My mission is create successes for Arab-Jewish tech ventures, to set examples, to create mutual interests strong enough to put differences aside. Reducing the fear is an important goal to create bridges.”“My first activity was to help found MooNa – a space for change, in 2013,” Gavrieli told The Report. “MooNa is a social venture for education in technology and entrepreneurship and is a meeting space for Arab and Jewish students. MooNa’s CEO and driving spirit is Assaf Brimer, a former IDF pilot. It is in the Arab village of Majd al Krum. Apple just announced it is opening its first excellence center in Israel at MooNa.”I asked Gavriely for some examples of companies he helped found.“In 2015, I co-founded OlfaGuard with Pierre Salame. The company received its first funding from Takwin labs, and recently won first place in the TechCrunch competition.In 2016, I co-founded WikayaMed with Dr. Mahmoud Kayal and Mrs. Nada Shiebly.Mahmoud is a good friend. He came up with a good idea to develop a preventive healthcare application from his years as a family doctor. The company received Office of Chief Scientist funding and I hold a board position there.“Lastly, in 2017, I decided to return to the driver’s seat and founded NanoScent, a company focused on scent recognition. Technion Prof. Hossam Haick and Eran Rom are my partners; I met Hossam first at MooNa, and through Pierre. The company recently received funding.” Haick, a Christian Arab from Nazareth, developed a remarkable electronic nose that can, among other things, detect the presence of cancer.In the last Knesset election, Israeli Arab parties joined forces and ran on what was called the Joint List. They elected 13 MKs.Some of those MKs have taken extreme anti-Israel positions. One of them, Basel Ghattas, went to jail for smuggling a cell phone to jailed terrorists. This has caused many Jewish Israelis to regard the Arab minority as a kind of disloyal fifth column.But according to a survey reported by the daily freebie Yisrael Hayom, “60% of Israeli Arabs are proud to be Israelis; 73% feel strong connections with the country; and 82% would rather not live in a Palestinian state.”What about the Joint (Arab) List? Many respondents said, “They don’t represent us.”I believe that deep down, Arab culture is highly entrepreneurial. But often the enterprise is of the shuk (bazaar or market) variety – buy goods cheap, sell them dear.When technology skills combine with inherent entrepreneurial drive, and when opportunities are created, good things happen.Take, for example, the 1.5 million Arab Americans. They have a higher median household income ($56,433) than the national median ($51,914). Within this community, Lebanese Americans, who make up a third of Arab American households, lead at $67,264.Many have founded businesses.Together with Dadi Perlmutter and with Technion support, I created an online four-course specialization in start-up entrepreneurship, offered through Coursera, a leading online education website co-founded by an Israeli, Prof. Daphne Koller. Among the 20,000 students who enrolled, there were many Arab students, including those in countries that do not recognize Israel; thirst for knowledge and education leaps borders and politics. I exchanged emails with many of them and learned firsthand how deep their entrepreneurial drive is – and how tough it is for them to give it expression in their respective countries by launching start-ups.More and more hi-tech experts – people of vision, energy, experience and goodwill – are working with Israeli Arabs to foster Arab start-ups. While peace with the Palestinians seems more distant than ever, perhaps we can set out on the long hard road to peace by building strong hi-tech collaboration among Israeli Jews and Arabs here at home – truly win-win for all. And when peace between Israel and the Arab world does come, perhaps Israeli Arab techies will then serve as role models for the world’s 300 million Arabs.The writer is senior research fellow at the S. Neaman Institute, Technion and blogs at www.timnovate.wordpress.com
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