Austria strikes a balance between tradition and modernity. Attractive conditions for research and development, a lively startup scene and excellently trained skilled workers create an ecosystem of opportunities - also for Israeli companies.
When it comes to Austria, some people may think of nature’s beauty and snow-covered mountains, or else Mozart, Sachertorte cake or the Lipizzaner horses. However, Austria has far more to offer than just tourist attractions and a beautiful countryside - namely attractive conditions for research and development, for example due to the 14% research tax credit for R&D expenditures combined with direct research funding. This is an absolute unique selling proposition for Austria often proving to be the decisive factor in selecting a business location. The close, practice-oriented cooperation between companies and the scientific community is outstanding. Moreover, Austria is rated number one in Europe with regard to intellectual property according to the latest innovation ranking of the EU Commission. No other nation in the EU registers as many patents, trademarks and designs in relation to its GDP.
Therefore, it comes as no surprise that international companies are discovering the relatively small country in the heart of Europe, and thus further increasing research thanks to their activities. One example is the Israeli firm Keepers Child Safety. The startup founded in Tel Aviv succeeded in winning over Austria’s Blue Minds investor group in the very beginning. Keepers has been active for several years thanks to its AI-supported App designed to protect children and young people against Internet harassment and cyberbullying. Since April 2021, the two founders Hanan Lipskin and Aviad Meshel have also been operating a limited liability company in Vienna at the Blueminds site. The App was funded by the European Commission as a particularly innovative product within the context of the Horizon 2020 program and also received more than € 1 million in funding last year from the Austrian Research Promotion Agency FFG. For Hanan Lipskin, Founder & VP Business of Keepers Child Safety, the choice of Austria was an easy one for several reasons.: "Due to our investors we've always had a close connection to Austria which grew even stronger through our partnership with Drei Austria. However, it was the startup-friendly Viennese eco-system and the support by ABA which led us to apply for the FFG grant and choose Austria as our home base for R&D & Product Development instead of other EU countries. In Vienna, with its direct access to universities and a thriving startup scene, you can find highly skilled employees who are crucial for our success as a cyber-tech startup. Currently, we are looking to expand our staff of data scientists, NLP specialists and developers. As an Israeli company, we are more than proud to be part of the Austrian ecosystem and very excited about our future here."
Austria is a “strong innovator”
Austria is ranked among the very best internationally thanks to its research ratio of 3.26% and is considered to be a “strong innovator.” Even if the sights and delicacies are more perceptible to visitors, Austria today is a typical industrialized country similar to Germany and Japan. The economic horsepower is manifold and diverse: horse-drawn carriages for tourists can still be seen in the cities, but simultaneously BMW produces two-thirds of all its engines in Austria. The Lipizzaner can be admired in Vienna’s Old Town while research on possibilities for the autonomous driving of vehicles and trams is being carried out at the same time.
The mixture is the essence
The sectors enjoying a lively and attractive business environment here are as diverse as the country itself. Developments in autonomous driving in Austria not only focus on testing sensors in real driving but the use of virtual vehicle models or mobile, three-dimensional map systems encompassing details such as traffic lights, parking space markings and surrounding vegetation.
The pharmaceutical and biotechnology industry in Austria is strongly shaped by the subsidiaries of foreign companies. The Swiss Novartis Group recently invested € 900 million in a new production facility for biopharmaceuticals, whereas the German pharmaceutical multinational Boehringer Ingelheim is building a climate-neutral “green factory” at a cost of € 1.2 billion - the largest single investment in the company’s history.
From Austria to the entire world
None of these companies focuses on the Austrian market alone but supplies Europe or the entire world from its Austrian production lines. The country’s central geographical location and excellent transport infrastructure are a big help, but other arguments also play a role in research and development. For example, qualified international staff prefer a country with a high quality of life. The Swiss IMD Institute rates Austria second in the world in this regard. In the ranking of the British magazine “The Economist,” Vienna once again grabbed the top spot as the most livable city in the world from Auckland in New Zealand.
Israeli success stories
The advantages of Austria as a business location are luring an increasing number of Israeli companies. Otorio, an Israeli startup established by former cybersecurity experts of the Israeli army, set up a joint venture with the Austrian company Andritz. Together they want to develop an innovative, industry-oriented cybersecurity platform. In 2019 Otorio and Andritz presented their new, web-based digitalization platform at the Hannover Messe trade fair along with a comprehensive product portfolio under the Metris technology brand, encompassing innovative digital products and solutions. The cutting-edge cybersecurity concept for protecting digital industrial processes can be applied by customers of as well as other companies across all industries.
The Israeli startup Aquarius Engines presented an innovative hydrogen engine in May 2021 after it was subject to extensive testing by AVL Schrick GmbH, a subsidiary of the Austrian firm AVL List GmbH. The successful tests concluded that the linear engine developed by Aquarius Engines can actually be driven by hydrogen. The linear engine is primarily designed for use in stationary power generation facilities. Thanks to its compact design featuring a length of close to one meter and a light weight of only 10.5 kilograms, it can also be directly integrated as a generator drive in electric cars. The engine can be adapted to different fuels and can also be driven with regular gasoline, LPG or CNG as well as hydrogen.
The Israeli company FibroLAN is a specialist in the field of fiber-optic access technology and Carrier Ethernet services. FibroLAN already founded a branch office in Austria. FibroLAN focuses on the core sectors of network and mobile network operators, utilities, municipal facilities, transport (roads and railways), the defense industry and large companies, and sees substantial opportunities in Austria and nearby markets.
For all these companies, Austria is in close proximity, literally and figuratively speaking. It is a livable and affluent country offering full access to the European single market. Furthermore, an extensive offering of direct flights between Tel Aviv and Vienna ensures easy accessibility.
Support on the path to success
Whoever takes a step into the Austrian market will find Austrian Business Agency (ABA) to be the perfect companion, a fact underlined by René Tritscher, Managing Director of Austrian Business Agency. “We give free, tailor-made support to companies on all issues relating to the business location, setting up business operations and searching for skilled workers. In this way, we are a partner and service provider to international companies expanding to Austria and beyond.” In addition, ABA establishes contacts to research institutes, funding institutions and other key players, helps to find laboratory space and other properties and provides information on all issues contributing to a successful start in Austria.
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This article was written in cooperation with Austrian Business Agency