As home to 250 multinational R&D centers, 87 NASDAQ companies, and the highest number of startups per capita, Israel has steadily attracted widespread interest from the global startup community. Since 2011, that interest has manifested in DLD Tel Aviv — the country's largest tech gathering, which takes place this year from September 6 to 12.
Among DLD's global network of events, there's something very characteristic about DLD Tel Aviv. For starters, it's not contained in one event space, but rather encompasses the entire city from its beach to its touristy Rothschild Boulevard to its municipality building in the historically significant Rabin Square. Also, beyond the two-day DLD conference, DLD Tel Aviv features a weeklong festival of events by multinational companies, government delegations, local industry groups, and the city itself.
To wrap our heads around why Tel Aviv, aka “Silicon Wadi," has become such a unique DLD host, we spoke to someone who knows Israel's startup scene best — DLD Chairman Yossi Vardi. Often called the “godfather" of Israel's tech industry, Vardi prefers to more humbly and humorously describe himself as its “Jewish mother." And, like any good parent, he has guided and invested in Israel's hi-tech startup ecosystem for over two decades.
Since it's impossible to separate the distinct DNA of DLD Tel Aviv from that of its Israeli heritage, Vardi shares his expert insights on both.
A Snapshot of Israel's Ecosystem
Why is Israel considered a startup nation?
This can be the topic of a whole other interview! But, in a nutshell, the level of activity that goes on in Israel's startup scene is staggering. It has the most startups per capita than anywhere else in the world. Israel also has one of the largest amounts of publically listed companies and a huge concentration of R&D centers of leading multinational hi-tech companies. For example, Intel invested in over 60 startups in Israel and created a company here that employs over 12,000 people. And Israel is the only other country beyond the US where Apple has R&D centers — three of them to be exact.
You've said that the secret behind Israel's flourishing tech scene is the “Jewish mother," and you've even described yourself as one. What does that mean?
What I mean is that Israel's creativity, innovation, and entrepreneurship are the products of more than just government policy, education, and military experience. Those are all platforms that help fuel the entrepreneurial spirit here. But the sparkplug that ignites this fuel is the culture and spirit of the people. It's about virtues. I jokingly use this “Jewish mother" metaphor to emphasize that these virtues are being instilled in Israelis when they are children. But, I always say you don't have to be Jewish or female to be a “Jewish mother." The “Jewish mother" is not a gender or an ethnicity: it's a mindset. You find this “Jewish mother" mindset in any society that breeds entrepreneurship.
In 2014, Israeli startups witnessed a record year of exits valued at $15 billion — nearly doubling 2013's $7.6 billion. IPOs reached a record $9.8 billion. What can we expect by the end of this year?
So far, for the first half of 2015, the numbers exceed what we saw this time last year. So, staying at this pace, I expect 2015 will break records again. We're seeing a lot of activity in IPOs, acquisitions, and investments — both domestic and foreign.
As you mentioned, many multinational companies have R&D centers in Israel. Now, some of them, like Citigroup and Microsoft, are starting accelerators here too. Will that become a new trend?
Yes, we're definitely seeing more companies opening accelerators in Israel, and many times, it's their first accelerator that they've ever launched. Another interesting thing we're seeing is a partnership between two or three companies to open an accelerator — there are two such programs in Israel now. These are companies that aren't direct competitors in the same space but are complementary to each other and have similar needs, so they've opened an accelerator together. I think this signals a whole new milestone in the life of startups.
If you look at the lifecycle of a startup, first you have the idea, then the development, then market penetration, and finally the scaling. Different societies excel within different stages of this lifecycle. Israel, for example, is really good at the early stage of coming up with ideas, implementing them, and breaking into the market. But we're not as strong when it comes to scaling. This is where the large multinational companies come into play. They come here, with an accelerator, for example, and bring the funding, strategic thinking, and international deployment.
A Sneak Peek at DLD Tel Aviv 2015
DLD Tel Aviv is now in its fifth year. What's the format and how is it unique among the DLD conferences?
The DLD brand has a diverse portfolio of events that varies in format, content, and length, depending on several factors including the character of the host city. For example, events vary from one to three days long. Because of the huge demand in Tel Aviv, the DLD event took shape as a weeklong festival that consists of over 100 events, 30 of which are created by the community itself. The festival, which spans seven days, is a platform for which companies can create their own events that are separate from the two-day DLD Tel Aviv conference. For example, in conjunction with the DLD festival, the municipality of Tel Aviv is holding its own conference focusing on creative cities. And, in terms of access, the large majority of events are open to the whole startup community and free of charge.
What can we expect in terms of attendees and content this year?
Every year, the attendees have grown and become more diverse. This year, we have nearly 50 delegations from all over the world — the biggest from Japan with 60 people. In terms of themes and content, it's a bird's-eye view of industry. We'll cover topics on investment, various technologies like mobile, startup activity in the Far East, and much more. We'll also have a special session on confronting shaming, bigotry, and hatred within the startup ecosystem, which has become a growing concern.
What would you pinpoint as a significant difference between this year's DLD Tel Aviv and last year's?
There's been such growth! We're hosting the conference in the same space, but this time we had to build four extra tents just to accommodate everyone. We expect 2,000 people from abroad, whereas last year we had 1,300. With all the events combined, we anticipate there will be 10,000 participations — and I say “participations" because attendees will likely engage in more than one event.
And it's not just a conference. There will be parties and social events. It's a big celebration: the whole city is on steroids. And, this year, we're even taking the festival to the beach with some events. But I can't take credit for this! In addition to the great DLD team, it's been made possible thanks to our partners Hubert Burda Media and Oscar4B, a local event producer in Israel.
Can you give a snapshot of the types of people who will attend?
The types of people who are coming are usually senior executives from large corporations — such as chief development, innovation, product, and technology officers. These are the people who are hunting for new opportunities and technologies. For example, the CTO of Amazon has attended religiously since the beginning and will be here this year again.
Investors make up another segment of attendees. We expect about 400 to 500 investors that are angels or from VCs and investment banks. And, last but not least, we also will have many attendees from the public sector as well. For example, we'll have government speakers from France, Netherlands, and Spain.
What about from inside Israel — who attends?
From inside Israel, we give a lot of open access to the startup community. My personal passion is to empower the startup community, and since Israel is not geographically in the middle of the scene, there is a need for Israeli startups to interact with international people. We are happily facilitating this with DLD Tel Aviv. The idea is to create a big theater of interaction.
With all this interaction between multinational companies, investors, policy makers, and local startups, what are the outcomes you hope to see from DLD Tel Aviv?
What happens is an exchange of ideas and insights, and gaining leads for potential relationships. There are two major goals: 1) to help people meet and engage with each other, and 2) to expand horizons and give people insights. And I think the best way to judge our success is by looking at the growing demand for the conference.
The DLD team also looks very carefully at our entire network of events to see what works best. So, I'm sure that whatever works really well in Tel Aviv will find its way into other global DLD events, and vice versa.
Finally, going back to goals, there is something larger to the entire DLD brand beyond just doing business. We also aim to look at how technology affects society and to foster conversations about it.
For more information about DLD Tel Aviv or to register, visit dldtelaviv.com.