Tel Aviv might be among the most influential and international tech centers in the world, but it is the historical city of Jerusalem that is quickly establishing itself as a powerhouse for entrepreneurial activity and cutting-edge innovation in Israel, according to a new report.
Just ahead of Yom Yerushalayim (Jerusalem Day), celebrated on Friday, May 22, Israeli NGO Start-Up Nation Central (SNC) released encouraging data on the city’s technology ecosystem and its evolving landscape.
Jerusalem is currently home to 405 active companies, a 102% increase from 2012, according to the report. In 2019, USD 233.5 million was invested in Jerusalem-based companies, which is a 21% increase from the previous year. Jerusalem-based startups have had 22 exits and total investments worth USD 1.6 billion, according to Start-Up Nation Central’s Finder, an online tracking platform for startups.
Jerusalem is home to Israel’s largest tech exit in history—Intel’s acquisition of the company Mobileye, co-founded by Amnon Shashua and Ziv Aviram. The Jerusalem-based driver assistance vision tech company was sold to Intel for a whopping USD 15.3 billion.
This year, another Jerusalem company, the content creation app developer Lightricks, officially became a unicorn with a USD 1 billion valuation. Other unicorns out of Jerusalem include Orcam, the company that has developed tech for the visually impaired, also co-founded by Shashua and Aviram.
Read this: Intel acquires Israel’s Moovit in USD 900 million move to accelerate autonomous transportation with Mobileye
“Jerusalem’s tech sector has not only grown dramatically in the past eight years but can serve as a model for an emerging global tech hub,” said Wendy Singer, executive director at SNC, in a statement. “Producing some of Israel’s standout unicorns has been Jerusalem’s calling card. This proves there are ecosystems developed outside of Israel’s center that can prosper and function—and be part of the economic growth in Israel’s periphery.”
Companies in the life sciences sector and the artificial intelligence sector are the most prominent fields in Jerusalem, according to SNC.
The number of companies developing artificial intelligence technologies has grown from 30 to 80, a whopping 166% increase. In 2019, over 60% of the (disclosed) investments in Jerusalem-based startups were in the field of AI. This is in large measure thanks to the strong machine learning faculty at the Hebrew University of Jerusalem. Last year, over 60% of the investments disclosed in the city were by companies that develop products or technologies using AI and machine learning.
There are 130 life sciences companies in Jerusalem, which include 44 digital health companies, 41 medical device companies, and 48 in pharma. Many of these companies are helping to fight the COVID-19 pandemic.
Jerusalem hospitals and universities have conducted important research on COVID-19. Shaare Zedek Medical Center sampled more than 2,500 coronavirus patients in order to establish the country’s largest COVID-19 database. This biobank allows researchers to characterize the disease, identify complications, find new diagnostic methods, test new treatments, and even contribute to the effort to create a vaccine. More than 65 coronavirus studies have already been performed at the hospital.
Read this: Israeli startup raises USD 5 million for facial recognition tech that can identify masked faces
The Hebrew University has focused on the virus characteristics, possible early detection techniques, and more. By the end of April 2020, Yissum (the technology transfer company of the university) has made 33 pandemic-related technologies available for licensing.
“During COVID-19, the sheer amount of corona[virus-related] tech solutions coming out of Jerusalem further embedded the global standing of the city’s biotech sector” Singer adds. “If you layer the strength of the city’s life sciences ecosystem over Israeli’s relentless problem-solving gene, it’s not hard to imagine that technologies born here are going to be picked up elsewhere.”
SNC says there are several factors that formulate a culture of innovation and success in Jerusalem. The city’s diverse population—secular and religious, Jews and non-Jews, men and women, Israeli-born and new immigrants.
Drawing on the city’s diverse demographic makeup, there has been a movement to train and integrate the Israeli Arab and Ultra-Orthodox communities into the tech sector, thereby creating an innovative model being studied by foundations and governments in other countries.
The presence of world-ranked academic institutions, like the Hebrew University for Life Sciences and Computer Sciences, as well as the Bezalel Academy for Arts and Design or Hadassah College, also help to advance the tech culture in Jerusalem, The nexus point of technology, design, and science results in great creativity and human capital, attracting the eyes of global audiences, SNC said.
The coalition of government, NGOs, and academic players have also committed themselves to supporting and strengthening the tech sector, including SNC.
The city’s tech ecosystem continues to grow and make connections with the support of such entities, helping companies make great connections, host events, promote innovation and collaboration, as well as create and cultivate innovation hubs, entrepreneurship programs, and accelerators.