In this second part of our trilogy, exploring new markets for Gibraltar businesses who are looking to expand beyond the EU, we explore one of the world’s innovation powerhouses, the start-up nation – Israel.
Located right at the opposite end of the Mediterranean Sea to Gibraltar, Israel is a relatively small country with a population of approximately 9 million, with an area similar to the size of Wales. The population of Israel is very diverse with the Jewish population accounting for 74% and comprises of Jews which have arrived from all corners of the world. Of the Jewish population, about 20% are of Russian/ex-Soviet Union origin, and whilst the majority of Israelis are secular, about 21% are orthodox religious. The Arab population in Israel accounts for 21% of the total population. Diversity is also a big contributor to the Israeli start-up state of mind. Israel is a country of immigrants and it has been compared in those lengths with America, to understand Why, check here this post named first Gen Americans. Almost two-thirds of the population is made up of newcomers who were willing to uproot themselves and move to a new country. These natural risk-takers are the perfect candidates to become entrepreneurs.
This openness to risk-taking along with the need to overcome numerous existential threats have turned Israel into the second largest start-up ecosystem in the world, following Silicon Valley. Almost every reputable multinational tech company in the world has a Research & Development centre in Israel, including Intel, IBM, Amazon, Microsoft, Google, Facebook, and Apple. Most of these centres were a result of making local acquisitions of Israeli start-ups. Thus, if you are looking to develop a new product or looking to find a technological solution that can optimise your business operations in one way or another, Israel is the place to look at.
Being small means Israel has a small local market, so entrepreneurs are forced to think globally and prove to the world that size doesn’t matter. Consequently, Israelis are constantly looking for ways that can help them penetrate new markets, and cooperation with Gibraltar-based businesses as a conduit for doing business in the UK (and beyond) is an attractive proposition worth exploring with entrepreneurs in Israel.
Israel’s three biggest cities play different roles in the country’s economy. Jerusalem, the capital, is the seat of Parliament (the Knesset) and any business with the Government and public sector is mostly done there. Tel Aviv is the country’s financial and commercial hub, with most banks, financial institutions and corporate headquarters found there. Haifa, in the north, is Israel’s main seaport and centre for manufacturing industry and production, and also home to Israel’s largest HiTech park. Israel’s small size means that both Jerusalem and Haifa are within less than 1-hour drive from Tel Aviv, making Tel Aviv the most convenient place to stay when coming to Israel for business.
- Do know who you are going to do business with. Business culture in Israel is casual and informal. Israelis are direct, assertive and persistent. Business is fast-paced and often conducted with an inherent urgency. At the same time, personal connections are of the utmost importance. Colleagues and business partners take time to get to know one another, socialise and drink coffee together.
- Do your cultural homework – Israel is a young country with few natural resources and it frequently faces adverse conditions. These factors play into all aspects of Israeli culture, including its business environment. Israelis prize intelligence and creativity, showing respect for experts and prominent specialists in their field.
- Do expect Israel junior team members to voice their opinion and take an active role. The management style in Israel is often collaborative, and the concept of hierarchy is practically non-existent. Israelis are interested in solutions and results, and everyone is given the opportunity to voice their opinion. Nevertheless, the most senior person will have the final say in the decision-making process.
- Do be prepared for interruptions during your business meeting. The informal atmosphere of Israeli business combined with the importance of relationships means that people will take the time to answer calls or visits from other people. This may be very distracting and may seem impolite but being efficient in Israel means doing more than one thing at the same time.
- Do respect the religious background of your business partner. Religious Jews, for instance, won’t shake hands of members of the opposite sex in this way. It is customary to ask if there are special requirements when serving food or drink, as some Israelis observe the dietary laws of Kashrut (Kosher).
- Don’t use understatement and subtleties. Israelis are direct and state their opinions. You should try to do the same. Israelis will trust you more if you are honest and direct. Expect business to be straightforward and emphasise the ‘bottom line’.
- Israelis generally have strong opinions when it comes to politics, religion and the Palestinian conflict. Try to steer away from conversations on these topics and try to remain neutral on the subject to avoid causing offense.
- Don’t do business on Friday or Saturday, as this is the Jewish Sabbath day. People typically work from Sunday to Thursday.
Israel is a vibrant, innovative and friendly market to do business in. The Gibraltar-Israel Chamber of Commerce (www.gibrael.org ) can assist with opening doors for you to this market.