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The story of a Start-Up Nation: book outlines the lessons of Israel's success.

Some books are written to boast, justify or defend; some are didactic; some to entertain and at the same time, spin money. Many fit into most of these categories, a few into none. But Start-Up Nation: The Story of Israel's Economic Miracle has a classic appeal; it tells a compelling story and at the same time, offers valuable lessons.

Available in English and recently translated into Bulgarian, as [TEXT UNREADABLE IN ORIGINAL SOURCE.] HObatop, the book addresses - as per the blurb - how a country of 7.1 million people, then just 60 years old at the time that the book was written, surrounded by enemies, in a constant state of war since its founding, with no natural resources - produces more start-up companies than large, peaceful, and stable nations like Japan, China, India, Korea, Canada and the United Kingdom.

"When an Israeli entrepreneur has a business idea, he will start it that week," one analyst is quoted as saying.

It's that, and more than that. Senor and Singer explain that Israel's policies on immigration, research and development and military service have been key factors in the country's rise.

Attention

"This is a book about innovation and entrepreneurship, and how one small country, Israel, came to embody both," the authors note.

One of the leading figures in the book, setting the keynote at the opening, is Shimon Peres, a legendary figure in the story of modern Israel and now the country's President. With Shai Agassi, a young entrepreneur, Peres appears making a pitch for innovative battery-powered electric vehicles, in a discussion that evolved into Agassi's start-up called Better Place, the fourth-largest start-up in history at $200 million, a business to provide battery recharging facilities for electric cars.

"Technology companies and global investors are beating a path to Israel and finding unique combinations of audacity, creativity and drive wherever they look," Senor and Singer say.

Microsoft's Steve Ballmer has called the company as much Israeli as American because of the size and centrality of its Israeli teams. "Warren Buffett, the apostle of risk aversion, broke his decades-long record of not buying any foreign company with the purchase of an Israeli company - for $4.5 billion - just as Israel began to fight the 2006 Lebanon war.

Adversity

It may be that adversity necessarily breeds inventiveness but, the authors say, no other country facing such adversity has produced an entrepreneurial culture - not to mention an array of start-ups - that compares with Israel's.

Part of the explanation lies in the extraordinary approach to the way that the Israeli military is run, notably the encouragement of the freedom to challenge and express ideas (a concept that veterans of other militaries may well look on with envy).

The book quotes Amos Oz as saying that Judaism and Israel have always cultivated "a culture of doubt and argument, an open-ended game of interpretations, counter-interpretations, reinterpretations, opposing interpretations. From the very beginning of the existence of Jewish civilization, it was recognized by its argumentativeness".

Add to this the fact that individuals' careers in the military are intelligently and strategically handled and, in the private sector, meaning in job interviews and advancement, mean much.

Also factored in is the effect of the Arab boycott which made exporters turn to small, anonymous components and software. "This, in turn, positioned Israel perfectly for the global turn towards knowledge- and innovation-based economies."

Policies

The book points out that government policies, "which had to be as adaptive as Israel's military and its citizens, and suffered as many turns of fortune" were also key in the country achieving fiftyfold economic growth in 60 years.

After an extended period of hyperinflation, in the mid-1980s then-finance minister Peres led a stabilisation plan developed by US secretary of state George Schulz and IMF economist Stanley Fischer, that dramatically cut public debt, limited spending, began privatisations and reformed the government's role in the capital markets. But moreover, it was not this plan that made the difference on its own - that came from a new wave of immigration, a new war and a new venture capital industry. Immigration is shaped by the policy of encouraging Aliyah, the return, but also by actively integrating immigrants.

In turn, Benjamin Netanyahu, now Prime Minister but finance minister in 2003, set about changing the mindset of the country in a revolutionary way, including banking sector reforms and other measures.

Add to that the founding of top-notch universities, and the fact that Israeli research institutions were the first in the world to commercialise academic discoveries.

The world has much to learn from Israel, as Israel has much to learn from the world, the authors conclude, quoting Peres: "The most careful thing is to dare".

INFO

Start-Up Nation

Dan Senor and Saul Singer

Published by Twelve Hachette Book Group

New York

www.HachetteBookGroup.com
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No portion of this article can be reproduced without the express written permission from the copyright holder.
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Article Details
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Title Annotation:Special feature: Israel
Author:Leviev-Sawyer, Clive
Publication:The Sofia Echo (Sofia, Bulgaria)
Geographic Code:7ISRA
Date:Jul 6, 2011
Words:797
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