Are tech giants throttling Israel’s “startup nation”?

Jan 14, 2019, 7:06 AM EST
(Source: Fondation France Israël/flickr)
(Source: Fondation France Israël/flickr)

Israel, a tiny Mediterranean country, has been oozing an alluring startup energy that attracted more than 300 global technology companies. The trend may sound counterintuitive, but these very firms have unwittingly stifled the growth of a majority of the country’s 6000 startups through unexpected interventions in a bubbling ecosystem.

The arrival of global tech giants in Israel has spurred a serious imbalance in demand-supply of technology workers, writes MIT Technology Review. The shortfall of programmers, scientists, and engineers is forcing Israeli companies to open branches abroad, which is not a good sign for its own startup culture.

Local companies can’t match the bloated salary packages offered by the multinationals and wind up losing talented professionals. As author Saul Singer explains in his book “Start-Up Nation,” corporate giants and Israel’s startups are locked in a symbiotic relationship, with one good at innovation and the other at scaling up, but the same alliance threatens the country’s “startup nation” model.