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Look who’s jealous of Israel’s economy, and why

25 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

This week’s press conference in Jerusalem, organised by the Minister of Finance Moshe Kahlon, was an occasion for celebrations and showing off. Israel’s economy has raked up some impressive achievements in the past twelve months.

Kahlon pointed to a 3-leveled triumph. First, tax revenues have continued the trend since 2012, constantly that bit higher than initially predicted. This in turn has meant that the budget deficit has consistently been lower than estimated – about 2.2% as opposed to 2.9%. And therefore, and this is the big news, the ratio of the GDP to the overall national debt is now down to 62.1%.

To explain: This stat is important because it demonstrates a country’s ability to pay back debts. When too high, it is difficult for both a country and corporates to raise money overseas. To give a comparison, when the Greek and Spanish economies were at their lowest point, their debt ratio went soaring over 100%.

How do other leading economies fair today? Britain has clocked up 89% and the USA 105% – remember how Wshington’s finances were gridlocked during part of the Obama administration. The Euro zone average is about 92% – and recall here that in order to join the EU years ago, 60% maximum was a prerequisite.

In parallel news from Jerusalem, the governor of the Bank of Israel, Karnit Flug, cited several positive reasons at her regular monthly briefly to keep the rate of exchange low at 0.1%.

The low rate of inflation reflects the effect of the (shekel’s) appreciation, and possibly structural change and enhanced competition in the economy. Short-term inflation expectations are below the target, while longer term expectations derived from the capital market remain anchored near the midpoint of the target range…..The picture of real economic activity remains positive. …… Foreign trade data indicate a recovery of manufacturing exports, after a prolonged decline since 2014. The picture conveyed by the labor market remains very positive, and the increase in employment and wages was led by the business sector in the past year.

Yes, concerns remain elsewhere. For example, the housing market bubble has yet to be controlled, although there are some signs of hope, finally. Small businesses are still waiting for politicians to release legislation to help them. Powerful unions continue to control the ports. Food prices are absurdly high, due to a series of interested parties exerting control behind the scenes.

I am sure that Mr. Kahlon’s press conference was a political stunt. That said, let us give the Israeli Minister of Finance his due. The Israeli economy has notched up a series of successes in 2016 that others in the OECD can only dream about.

BDS? Those surprising Palestinians who do not boycott Israel.

23 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem, Palestinian Society, Palestinians

I have just returned from a visit to a large medical in clinic in Jerusalem. People of all persuasions and languages – pensioners, soldiers, Arabic, English, Hebrew and Russian.

And this started me thinking how some of those in the waiting room might define themselves as Palestinians. Surely there are other areas of cooperation between the sides that the world media just does not allow others to learn about. A quick consultation with Rabbi Google, and I was stunned to learn just how embracing are the joint areas of activity. For example: –

  • Let us start with a practical example of everyday life. A dog sanctuary, located in Beit Sahour near Bethlehem, is often short of resources. A way has been found by the Palestinian Authority (PA) to enable Israeli animal lovers to help out.
  • The Negev desert has seen many projects involving both Israelis and Jordanians. Much of the effort is focused around the Arava Institute For Environmental Studies. With nearly a thousand graduates over two decades, “about 29 percent are Israeli Jewish, and about 24% are Arabs from Israel, Jordan and the Palestinian Territories“.
  • Israel’s scientific partnerships with the EU are well documented. However, I came across this EU sponsored consortium, the SESAME Project – Synchrotron Light for Experimental Science and Applications in the Middle East.

Based in Jordan, it is an independent laboratory formally created under the auspices of UNESCO nearly 15 years ago. The founding members of SESAME include Israel and countries that do and some that don’t have diplomatic relations with each other, including Iran, Bahrain, Cyprus, Egypt, Iran, Jordan, Pakistan and Turkey, as well as the PA.

  • Water has often been a cause of sharp rhetoric for those campaigning against Israel. Last Sunday, “Israel and the PA signed a water cooperation agreement , the fourth major infrastructure deal agreed to in the past year and a half.” Other accords refer to electricity, mobile phones and mail distribution. Significantly, the document on water takes a long term approach, allowing for parallel changes in population for many years to come.
  • And finally, if all of that is a tad too gentle for you, yes, cooperation between Israel and the PA exists over security issues. Maj. Gen. Majid Faraj is the powerful head of President Abbas’ General Intelligence Service. He has also been seen as a potential successor to his octogenarian boss. Interviewed by “Defense News” last year, at the height of tensions with Israel, Faraj confirmed that in previous months “PA intelligence and security forces have prevented 200 attacks against Israelis, confiscated weapons and arrested about 100 Palestinians – claims that were not rejected out of hand.”

The past month has revealed a flood of stories from university campuses in the USA and the UK, where Jewish and Israeli students are physically and verbally abused. This is part of the  BDS campaign to boycott anything remotely resembling a link to the Jewish State.

As I have frequently observed, such a campaign is nothing short of anti-semitic. It is certainly hypocritical because has less to do with Palestinians and more to do with denigrating Israel. And BDS proponents simply lie, because they will not admit that Palestinians – from top leaders down – are also working, very well, with their Israeli counterparts.

Entrepreneurship and problem solving. A lesson from Jerusalem

20 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Wednesday’s event at the Jerusalem Business Networking Forum (JBNF) was a phenomenal success. The large crowd departed, highly motivated by the amazingly diverse set of practical tips about how to become an entrepreneur. Where to begin?

Actually in Las Vegas. Earlier this month, Israel once again proved its credential as a ‘start-up nation’. As ever, the Israeli pavilion at CES – Consumer Electronics Show – in the American desert was packed with dozens of companies. Personally, I find it ironic that so many applications today from the Holy Land are aimed at the automobile industry, an area of commerce where for decades Israel had been considered the undesirable.

Back in Jerusalem, the JBNF audience was treated to a feast from three speakers, all closely associated with the world of entrepreneurship, innovation and start ups. However, without wishing to detract from the words of wisdom of Harold Weiner and Nathalie Garson, I want to concentrate on the success story of Ran Poliakine. To be more precise, I want to understand what are the key factors that bring about his triumphs.

Ran started life as an arts student at the prestigious Bezalel Academy in Jerusalem. In his 15 minute presentation, he introduced just four of his companies.

  1. Powermat allows you to recharge your phone by placing it on a disk the size of drink’s-coaster. No need to plug it in. All done whilst you are sitting down, relaxing in a public spot. I was stunned to learn just how wide spread this tech is available, as a student from a Chinese business school observed that it is available throughout her country. It can also be found on Virgin Trains (UK), Cadillacs, several Samsung products…..to mention a few clients.
  2. Wellsense  has created a wonderful solution for that horrific problem of bed or pressure sores. Whether in hospital or at home, this is one of those awful yet not often spoken about topics. The company has created a fibre that allows the pressure of the mattress to be altered in designated areas, thus relieving distress from sores. It has been installed in thousands of hospital beds across America, including at Mayo clinics.
  3. Years of Water enables poor villages in the Third World to irrigate their crops and to sustain their inhabitants. The Israeli comapny designed and manufactures a “manually-operated, self -sufficient, maintenance-fee purification system capable of producing drinkable water within 10 seconds of deployment“. The stories are phenomenal.
  4. TAP eliminates the need for the computer’s keyboard. After a brief tutorial, you communicate with your hardware or phone via a flat surface next to it. Amazing.

Ran denies having a magic formula, which makes him a successful serial entrepreneur. That said, several factors did recur throughout his talk. And it is not just that he is based in the Jerusalem area.

A) His starting point is the problem itself, which others accept as given.

B) He realises that he is passionate about really wanting to solve it.

C) He does not accept the impossible.

D) He almost always uses the same core team.

In addition, I suppose that his artistic background allows him to be creative. Which leads me to one final observation. Two innovation indexes were published recently, from the World Economic Forum and by  Bloomberg. They place Israel – 50% desert and with a population of barely 8 million  – at 2nd and 10th respectively. The efforts of Ran’s team are a prime example of this ability.

Because of such teams, billions around the globe are benefitting. Could you imagine trying to stop or boycott such progress? May it long continue.

The BDS game. Is it possible to boycott Israel?

13 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Earlier this week, I questioned if it was still possible and even moral to boycott Israel, both economically and culturally.

The events of the past week have taken the discussion considerably further.

Let’s start with Amazon, that multinational with an ability to sell to literally every corner of the world. They have struck a deal with Kornit, a digital printing outfit. Located east of Tel Aviv in Rosh Ha’ayin, the outcome is likely to revolutionise how t-shirts are sold on-line.

Next there is Microsoft, no stranger to cooperating with Israeli tech. Together with Qualcomm, it will invest in the development of Team8, which specializes in cyber services. They will join others like Cisco and Google, who are partnering with this ex-Israeli army intelligence team. One estimation puts overseas investment in Israeli cybertech at 20% of the global scene.

If that sounds rather incredible, let us turn officially to the world of make-believe. This week, Israeli actress Gal Gadot, otherwise known as Superwoman, made one of the presentations at the Golden Globe awards. And yes, the film is shown around the world, except in places that boycott her.

And staying with the theme of arts, Coldpaly will finally have a chance to perform in Israel – two concerts – in November of 2017. One of the biggest acts currently performing on the world circuit, they have found the correct balance to meet the needs of all fans, and thus ignoring the narrow-minded protesters along the way.

And where does that leave BDS proponents? I am not sure, but this package of news is a clear dent in a campaign replete with its moral bankruptcy.

5 tips for the boss who works hard, but cannot clear their desk

12 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

One of the common problems that I see regularly are those company owners and senior managers, who work their guts out, but feel that they leave the desks at midnight with more work unfinished than when they started the day.

And we know the standard responses whenever a solution is suggested.

  • What will my boss think?
  • Nobody else can do this.
  • I can’t be seen to be slacking.
  • I promised myself that…..this is the last time, or…….that I will do this before I go, or……..
  • etc

This is self-perpetuating nonsense. And for most people, late night sessions often results in poor quality deliverables and which has taken much longer than normal to complete. So what has really been achieved?

There is another approach that I have developed over the years and tried to impress on my clientele as their business mentor and coach. Call it the “5 point Horesh guide” to being commercially successful without thinking about strategy and without preparing a spreadsheet.

  1. Exercise. There is increasing evidence that regular exercise jolts us into thinking more effectively and creatively. As many of my customers live in Jerusalem, Israel, they have some inspirational scenery to motivate them. By way of contrast, one of them creates training programmes. So instead of extra running, they took up a course in the arts, which has been equally beneficial.
  2. Eat properly. No, this is not a lesson in why to eat broccoli and almonds. Start your day with a full breakfast. Your body is just like a car, which needs quality fuel in it so that it complete its daily journey.
  3. Listen to others. That means networking. Find an opportunity to liaise with others in your field and also those outside your direct interests. It is amazing how insular we can become, and so quickly. “We only know best, as far as the information we once learnt is still relevant!”
  4. Don’t overwork, continuously! Why? Because you cannot keep beating your body into the ground. Just look around you and see how many friends, family and colleagues have come back from a blood test and been commanded to ‘slow down right now, or else’. If you regularly require more than 10 hours to complete your average work day, then there is a need for an immediate review.
  5. After 9.00pm, walk away from the computer. Neurologists have been telling us for years that computer screens often impact negatively on the amount and quality of sleep we strive for.

Little of this has to do with time management. Nor is this blog about strategy. However, if you cannot handle yourself properly and appropriately, do not expect that your assignments will be completed to the standard you desire. You might get away with it once, but it does not work in the long term. That means that the higher up you are in your corporate, the more likely that the organisation may not deliver the correct profit margins, because of you.

And by way of a bonus, here is one last idea. Try to find a way to spend time helping others. It is amazing how this can give you a feel good factor and then how this inspiration can be transposed back to your work space!

BDS – has it done its dash?

6 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Palestinians

BDS – Boycott, Divestment and Sanctions of Israel – has been around for about 15 years in its present structure. Formally, it calls on the world to punish Israel on behalf of the Palestinians.

There is no doubt that its politically correct slogans have attracted many to its cause. Occasionally, a pop group may cancel a tour of the Holy Land. A company may reduce or cease trading with counterparts in Tel Aviv and Jerusalem.

On the other hand, as I have repeatedly pointed out, it is a movement founded upon hypocrisy. Its leader studied at Tel Aviv University with all facilities open to him. It is a movement that fails to condemn human rights abuses by Palestinian leadership. Above all, it is not looking for change in Israel, but its obliteration from the map.

In the past year, there has been a wake up move, rejecting the fallacy of the BDS argument. Four Spanish cities have reversed resolutions, which had called for sanctions against Israel. A guitarist from the Bruce Springsteen outfit notoriously used an expletive to dispel any notion that he would support a ban on visiting Israel. And foreign investment continues to pour into the Holy Land, as the seen by the growing list of over 350 multinationals with R&D centres in the country.

In parallel, it is fascinating to note the increase in demand for space in industrial areas, located in the West Bank. Ostensibly, these would be the first companies to be face boycott calls if their exports were to reach overseas markets. And yet, we learn that the opposite seems to be true, especially when the trade is directed to the very countries BDS supporters had seen as natural allies; China, India and much of Africa.

It is noteworthy to look at the Barkan region, where there is a waiting list of 60 factories. Many of the current facilities ensure that Arabs and Jews work together. And by law, all employees have to receive full employment benefits, which far outweigh anything offered under the Palestinian Authority.

BDS is replete with the bile and hate of the worst elements of politically correct movements. It has impacted on specific individuals, companies and artists. Fortunately, it worst aspects seem – for now – to be over.

As a final thought, maybe if Israel’s detractors would lay down their weapons, then the Palestinian economy would achieve the  3.8% economic growth that Israel reached in 2016. Now that would be a true and direct benefit to the average person on the street in Gaza and in Nablus.

Investor presentation? 6 out-of-the-box “must dos”

4 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel

If Israel is the start up nation with just 8 million people, then in any given week, thousands of presentations for investors are being prepared.

What colour, which font, background graphics, the order of the slides – the guidelines for all of these issues have been well documented in countless blogs. What I want to share here are six key ‘must dos’ that should drive your presentation, making it relevant and ensuring that your audience will listen.

  1. Each slide has to carry a targeted message. In today’s business climate of immediacy, few have time for cute effects and background noise. Get to a point, and quickly.
  2. However large your deck – somewhere between 10 and 14 slides – make sure that it tells a story.
  3. What makes for an interesting story? First, early on, throw in a hearth throb of an anecdote. Second, throughout the pitch, tell the audience how they can make money! The technology, service or product may carry a ‘wow’ factor, but you need to show a business model with a clear path to a return on investment.
  4. Whatever your order of slides, the last one should have a take-home message. Not only is this a summary of the opportunity, but it conveys how – and why – the audience should act next.
  5. Rehearse your presentation. And when you have done so, rehearse and then rehearse again. Good actors do not fluff their lines under any circumstances. It is a convincing performance.
  6. While you are rehearsing, remember that you do not have to stick to the original slide. If your verbal flow and logic does not match the frame, then you need a quick rethink.

Quite often, it is the slide that needs to be changed as opposed to your words. The reason? Because the image does not help the potential investor show how they will double their cash. And that is why you are in the room in the first place!

Good luck.

Investing in Israeli high-tech in 2017: So much to look forward to

3 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel

Is the Israeli high-tech bubble about to burst?

On the one hand: There were 55 exits in Israeli high tech from IPOs and mergers and acquisitions totaling $3.5 billion in 2016, down 67%, compared with $10.69 billion in 2015. The number of deals also fell from 70 in 2014 and 2015, according to a report of exits by the PwC Israel accounting and consultancy firm.

However: 2016 was a strong year for Israeli technology companies in raising capital: $4 billion was raised in the first three quarters of the year. $200 million was raised in December and $620 million in the fourth quarter, while $4.3 billion was raised in 2015.

All the anecdotal evidence points to 2017 being another strong year for the Israeli high-tech scene, the land of the start-up nation.

  • Despite upward pressures from USA and elsewhere, the Bank of Interest is not looking to raise interest rates in 2017, and thus making it easier to secure funding.
  • Corporation tax is to be lowered to 24%
  • A new Innovation Authority is to be set up, headed by the former boss of Apple Israel, Aharon Aharon.

On the ground, there is a tremendous amount of activity. For example, last month HP canned a project overnight, which led to 200 or so redundancies in Israel. Many of these people are already well on the way to securing new positions. In another scenario, I know of one CEO who is so short of software engineers that he is considering the possibility of encouraging professionals to relocate from Western Europe.

The web is full of blogs pointing out Israeli high-tech companies to follow in 2017. And this follows on the success of 2016. As I have mentioned before, a key sector to watch is the support for the global manufacturers in the car industry.

And the investments themselves have not ceased over the Christmas holiday period.

  1. A US$2.5 billion dollar Chinese investment company, Yiling, has just sunk US$20 million into HealthWatch, a smart Israeli clothing outfit.
  2. Snapchat has made its first venture into Israel, picking up the augmented reality (AR) start-up Cimagine Media for about US$40 million.
  3. Qoros has announced that it will set up a smart car r&d centre in Israel, adding to the approximately 350 other conglomerates present in the Holy Land.

So, yes, there may have been fewer large exits in 2016, emerging from Israel. However, the growth projected for high-tech in 2017 is encouraging yet even more overseas players to join in the fun. Happy New Year!

16 going on 17 – Does Israel’s economy have a year of Disney dreams ahead?

2 January 2017
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Like the song in the Sound of Music, 16 going on 17, Israel’s economy seems poised to have another year of success.

Contrary to the predictions of many pundits, the statistics coming out of the Holy Land for 2016 really rock it. Boasting a 3.5% growth spurt, the Bank of Israel has calculated that the standard of living leapt by 2.9%. Unemployment dropped to a record low of 4.8%. Private consumption was up by 5.9%. Per capita growth rose 1.5%.

To paraphrase one of the skeptics, Sever Plocker, the upturn has secured a stable currency. In turn, the ration between GDP (the size of the economy) to the country’s debt has fallen to just over 60%. Most European countries are nowhere near this excellent level, which was actually a target set to met in about ten year’s time!

As for next year? Growth is set for a further 3.2% jump. Corporation tax will drop by one per cent to 24%. Income tax for the middle classes is to be reduced. The amount of guaranteed holidays for lower grade workers will increase. And the Tel Aviv stock market, which was stagnant in 2016, is projected to move up about 8%.

The stuff of Disney tales, indeed. Most of the OECD countries would settle for even half of all of this good news.

Unfortunately, beneath the headlines, there is another economy. The other stat that caught my eye last week was that approximately 20% of all Israeli families are looked after by social services. This includes 50% of those aged over 75 and nearly 23% of children aged between 12 and 17. Unacceptable.

Israel is a country of two economies!

In many other countries, that state of affairs could be seen as a threat to social stability. In Israel, the situation, as ever, is more complex. And if I can generalise for a moment: Ultra-orthodox Jews tend to have large families, yet tend to live modestly and are supported by an extensive system of charities. And large Arab families are still far better off than others in neighbouring countries such as Lebanon, Jordan and Syria.

Nevertheless, it is not a situation that should be taken for granted. More highly religious Jews are entering the workforce. There are schemes to encourage high-tech start-ups in the minority sectors. That is not enough, and the country faces key structural challenges that hold back progress.

  • The price of housing leaves most young couples firmly outside the game.
  • Regulation is prevalent and increasing, acting as a drain particularly on the SME sector.
  • There is a glaring lack of competition in the banking sector.
  • Food prices are kept high as interest groups keep out foreign competition.
  • The ports have yet to be privatised, thus ensuring continued inefficiencies and unnecessary costs passed on to the consumer.

I am sure that 2017 will turn in another set of fine numbers at a macro level for the Israeli economy. Mazaltov! My fear is that more and more people will be left behind in the process. In that scenario, there is rarely a happy ending. More needs to be done to ensure that this progress is enjoyed by a greater number, and not just the privileged families running the government.

What Trump means for Israel, and others – an alternative approach

21 December 2016
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Categories: Afternoon Tea in Jerusalem, Israel, Jerusalem

The world is trying to prepare itself for the ‘rule of Trump’. Few predicted it, but he won. And that gross misunderstanding is forcing politicians, professors, social scientists and mathematicians – amongst many others – to work out where they went wrong.

Enter into the equation Mrs. Sivan Rahav-Meir, a fascinating personality on the Israeli scene. Academically clever, articulate, born secular but found religion, journalist, tv and radio presenter, author……and the list goes on. At a private function on Tuesday in Jerusalem, she was asked to speak about the implications for Israel of the Trump victory.

She listed five points, most of which can be applied generically. To summarise her first four points: –

  1. Clearly the proponents of the Obama-Kerry-Clinton constellation have not been reading their political maps correctly. When Kerry stumbled in Paris at a press interview over what he tried to justify as “rational” for a terrorist, he gave the game away.
  2. Likewise, journalists are not in touch any more. (Yes, she saw the irony in herself, from that profession, making the claim). Just tracking Facebook posts through complex algorithms clearly misses the feelings of core voting groups.
  3. In parallel, but not a contradiction, the established media no longer controls the truth. The crown has passed on to digital media. This was emphasised by how the story was released of Hilary Clinton falling ill at the 7/11 memorial service. By chance, an ex Czech freelance journalist happened to capture the moment and post it.
  4. As “The Economist” magazine mentioned and since embraced by the Oxford English Dictionary, we live in the ‘post truth’ era. Youtube gives us our live news feeds. Just believe it, no?

However, moving to the culminating issue, Rahav-Meir asked if we have to polarise, as the rhetoric of Trump and Clinton forced America to become? We should ask ourselves what do we want from our society? This is where she quoted two people from opposite sides of the normal divides in Israel.

I) A secular journalist opinioned that we all need to wake up. The language or persona of “Reality TV”, usually full of gross exaggerations and which we can turn off under normal circumstances, had won the election. It had walked out of the plasma screen and like an unstoppable force barged into our lives.

II) A rabbi questioned that although Trump may have won, do we have to accept his way of acting? Whether the man accepts it or not, he has verbally abused women, minority groups and others. It is not just that these people have rights,  as per the old politically-correct Obama-Clinton message. Man has obligations to others!

Rahav-Meir paused for effect and to let these two observations sink in.

I felt that what she was alluding to is that this message, a bastion of Judaism for me, is one of the main foundation points of modern Israel. You could call it the raison d’etre of the State. However, Rahav-Meir appeared to be warning that a growing set of leading politicians are moving away from this concept of mutual obligations.

That would be so sad if she was to be proved correct, if not down-right ugly.

7 facts which show why Israel has a stand out economy this December

18 December 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Palestinians

December 2016 – It is nearly time for those end of year celebrations; Christmas and Chanukah fall on the same day this year. So lots of candles to light.

The economy of the Holy Land also stands brightly. I have not hidden my complaints about how certain population sectors have been ignored during recent booms nor how restrictive practices remain in place, such as in the ports. That said, just have a look at this impressive list of achievements as we prepare for a new year.

  1. Israel’s economy is growing at a little over 3% per annum. This is a real increase, factoring in the rise in population. Further, it is close on double the average rate for the OECD.
  2. Unemployment is at a 30 year low, around 4.5% of the work force. Again, this is a stat that other countries can only be jealous of.
  3. Despite a rise in the cost of commodities and the internal growth mentioned above, Israel has managed to ensure that inflation has been kept within reasonable and acceptable limits.
  4. Looking ahead, a strategy is emerging to lower taxes, particularly in the corporate sphere. This will encourage direct foreign investment and thus feed into further growth.
  5. The Palestinians are also set to benefit from this good news. An additional 22,000 daily work permits will be issued for them to cross over from the West Bank and from Gaza. (It is just a shame that they refuse to reciprocate and formally allow in Israeli exports, which would enhance the peace process).
  6. Jordan too is expected to benefit. It will receive cheap gas from new reserves developed by Israel. Jerusalem also intends to double its supply of water to the Hashemite Kingdom in the next few years.
  7. Large conglomerates are continuing to invest in Israel. I mentioned last week that Microsoft is about to invest US$0.25 billion in a new campus, just north of Tel Aviv. GE, BMW, Tata are just some of the other world leaders that have been in the news during the past month, when it comes to extending their activities in Israel.

All in all, 2016 has turned out well for the Israeli economy. I just hope more people can be part of that triumph. Meanwhile, there is cause for optimism regarding 2017.

Israel’s innovative culture – where does it come from?

16 December 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel

I strongly urge you to read about the “21 coolest tech start ups in Israel“. This is not an isolated item. For example, “27 Israeli companies are included on this year’s Deloitte Technology Fast 500 EMEA list, a ranking of the 500 fastest-growing technology, media, telecommunications, life sciences and energy tech companies in Europe, the Middle East and Africa.”

Whichever way you split, Israel remains that much talked about ‘start up nation’. But why?

We all know that economic or commercial success comes in waves. Israel’s change of fortune can be traced back to the mid 1980s, which is now a full generation ago. In that time, Israel has gone through two Intifadas, fought several campaigns on its borders, and survived at least two global turndowns. Despite that, GDP growth – based partially on high-tech performance – is predicted to come in at around 3% or more for 2016 and 2017, one of the better performers within the OECD group.

However useful this information is, it does not explain the culture of innovation in Israel. What is it that enables Israelis to see through established markets and then go on to create a disruptive technology? Discussions over the influence of the army etc are well documented on google. I will base my answer on a true story, emerging from within my own family.

My son has just started university. Not an outstanding student at school and after his obligatory stint in the army, followed by a tour around South America, he appeared to settle down to his first year of studies at university. Then, out of the blue, he asked me if I knew of a certain application that allows you to present new ideas to investors. And that was our first inkling that something was bubbling.

The next thing we know is that he applied to be considered for an accelerator. At this point, he shared his concept with us. Where had it come from? It was an area of commerce for which he had – to my knowledge – minimal experience. And I was correct, except that his one small, seemingly minor encounter had been enough to prompt him to think.

My son is not a high-tech freak. He has not learnt code. Gadgets are fun, but he does not have to have the latest new mobile every six months. And yet, he has grown up in an environment – school, the home, the army – which has encouraged him to challenge the accepted. He is also a very obstinate young man, as are many Israelis.

And thus, when the accelerator rejected him at the last moment, he pressed ahead. He looked for help from a partner. When his immediate surroundings could not help him out, he turned to Facebook. In particular, he sought out pensioners with the correct experience and who are looking for a new or challenging project in life. My son has since linked up with an individual who has spent a lifetime bring concepts through to commercialisation.

What happens next, we wait to see and learn. Clearly, my son and his generation in Israel has absorbed a culture that allows to do just what Star Trek wanted from us in the 1960s….”to boldly go where no man has gone before”.

Fail fast, succeed faster? 2 takes on what that means to you

15 December 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

The phrase “fail fast, succeed faster” is thrown around in the entrepreneurial, particularly by people embracing the lean concept of creating a business.

However, in my role of business coach and mentor, I have come to realise that few executives truly appreciate what it can mean for them. Today, I can across two examples, which clearly illustrate how each and everyone of us can benefit from this train of thought.

Case study number one – “the phone call”. It is amazing how frightening a simple phone call can be. For some people, especially when it comes to cold calling – calling somebody you do not know – this is simply no-go territory. They put it off.

Yet again, I was sitting with a new client, who told me that they had run out of leads. I have two standards responses in this scenario. I ask them if they have completed their list of calls to make for the day, before sitting down with me. Almost invariably the answer is no and nearly invariably the reason is connected to procrastination.

In addition, I encourage them to start looking through their contacts list on their mobile. Who can they call? The immediate response is ‘nobody’. Yet, once the task is completed, the client has had to swallow their words.

What reminded me of this was a posting today on Facebook by a former customer. He had picked out a two minute video by Steve Jobs. The king of Apple made a phone when he was twelve years old, that was to change his life. His message? If you never ask, you are unlikely to fail. There again, you are unlikely to succeed. “You have got to act”!

Case study number two is all about trying to see that which your eyes are hiding from you. For example, I met up with some scientists, who had started out by investigating a cream for the skin for the forehead. Uncertain what the results of their first trials had revealed to them, they consulted with an expert. Apparently, they had discovered the basics of a cure for a disease impacting on millions around the world. Time to write a business plan!

Very often, the core reason why people do not progress in their business venture is that they do not believe in themselves enough. Why? Well, each of us carries our own past.

As Jobs and others show, if we are just prepared to move a touch beyond our supposed comfort zone, we may not triumph immediately, but we are likely to get there eventually.

Israel’s economy in good shape – here’s why

12 December 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Karnit Flug, the Governor of the Bank of Israel, was very clear in her most recent survey. Israel’s economy is doing well.

Unemployment is well under 5%. New trade markets are being developed, as European partners continue to struggle after the credit crisis fall out. FDI investment continues to turn up.

Just look at some specific recent key-note successes: –

  • Microsoft is about to rent invest around US$1 million per month in rent for new office space in Herzylia just north of Tel Aviv.
  • BMW has announced plans to set up an r&d centre in the Holy Land, via its tech arm “Here”.
  • Tourism in November 2016 reached an all-time high for that winter month, over 30% better than the same month last year.
  • And if I had mentioned exports, Israel’s innovative approach to commerce is to allow it to tap into a US$0.25billion international distribution market for market cannabis.

On the structural side, as ever one cannot be complacent. For example, just look at my SME clientele that are swamped with needless paperwork when applying for a loan. Land prices remain high, thus ensuring that young couples are often left out of the bidding process  for homes and that office space in the big cities is hard to find. And the prices of basic food staples are driven upwards by monopolies so that the less well off stay…….less well off.

Karnit Flug has done a great job is keeping monetary policy stable, even when banks in great economic powers like Italy are struggling. That is the main role of any central bank. It is now up to the politicians in Jerusalem to rise and to meet those standards, as they determine the fiscal policy and budget for 2017. Why am I not over optimistic on this front?

Making an impact (2) – A golden method to start an investor presentation

8 December 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Last week, I challenged you to ask if your business is really making the impact you are looking for. The subject came up again last night, as I was moderating the monthly meeting of the Jerusalem Business Networking Forum. An excellent audience, filled with entrepreneurs, several were clearly looking to know how to “get into the heads” of target communities.

For example, I met for the first time a young couple, with whom I am about to start some business coaching sessions. Their immediate concern is how to pitch to investors.

I posed to them the following connundrum. Can they create a 45 second generic statement that contains these four points?

  • We are doing XXXX.
  • We are doing by using unique tech YYYY, which helps ZZZ market
  • We arrived at this adventure, because of s0-and-so, …………..a unique and emotional story.
  • And if this tech had been available then, they would not have had to suffer / sales would have been more significant / or whatever other strong benefit.

The beauty of this approach is that your elevator pitch now contains a ‘wow factor’. Your listener is forced to internalize and consider your offering. If the audience understands nor hears anything else, they will not forget these key messages.

Let me give you a more concrete example of what I mean. A client of mine, Sonya Davidson, pointed out to me a very powerful video on the BBC website. You cannot fail to be impressed with the results, as well as the feelings of the key players.

You clearly react to the message within about 20 seconds of the 3.5 minutes clip . The issue is right there, as is the pain. The scale of the market becomes obvious. And the cavalry – the solution – can be made available to many many others, and in real time. It is worth watching.

Creating this 45 second formula take time and practice – a lot of practice. I have invariably found that the results are rewarding. And that is called ‘impact’.

4 reasons why you may need an executive coach, and how to choose one

7 December 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

As an executive business coach and mentor, I am often posed a familiar challenging question by a potential client: “Why should I use your services?”. What they do not realise is at the same time, and more crucially for me, I am asking myself: “Do I want to work with you?”.

Let me explain the conundrum through four brief case studies, and a ‘curve ball’.

I found myself brain storming over my current crop of clients. I began to understand that four of them, while in totally differing commercial sectors, had similar characteristics. (For the sake of anonymity, I shall describe all in the male person and in the Jerusalem area, although this may not be accurate).

  • Alex is an academically brilliant person, who has been practicing medicine for years. He frequently interrupts me, because he believes  – usually incorrectly – that he knows how to respond before I have finished my statement. His business has known better days, but he feels he knows what needs to be done. How can he improve his sales flow?
  • Bert is in the wellness sector. Highly experienced, but again struggling for new clients. However, he has been refusing to come up with new ideas.
  • Colin is young and dynamic. He is seeking to creating a marketing agency in a field that is incredibly competitive.
  • David is a painter. Talented and ambitious, he gives the impression that he feels clients should find him. He does not want to have to chase the money.

Different people. Contrasting backgrounds and ages. Each looking to move ahead in their own field of commerce. And each one has turned to me. Why? Because, for all their excuses and bravado – some more than others – they are stuck. they are not doing what they want to do and make money from it.

Yet despite their diversities, my role is similar in each instance. I am there to motivate them!

Motivate them to do what? First, to accept that what they have been doing to date does not work well enough. And thus second, to encourage them to change. Third, to explain that what they may see as obstacles can be overcome, again with a innovative approach.

In contrast, let me introduce the curve ball. Every now and again, I am contacted by somebody who just wants one session, because that is what they feel is needed to move ahead. This is when I ask myself if that person is really interested in changing. My experience dictates that such a move does not come about in an hour, as I wave a magic wand.

Alex has learnt to accept that his many talents and clever responses do not drive a successful business model on their own. Bert has found a new form of “wellness” for himself, which is seemingly encouraging to search for clients. Colin has preserved, developing new revenue channels. And David, well early days just yet, but the game is on and he knows it.

Change is a process. Most of us appreciate that it needs to eventuate, and many come to the difficult conclusion that we cannot do it by ourselves. With some irony, the spouse or partner is not always heard as the voice of encouragement. And thus a neutral, external and professional source is required, which can also inspire trust. That is why people use executive coaches and mentors.

Does your business make an impact?

1 December 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

Last month, I attended the award ceremony for the Mass Challenge Competition in Jerusalem. An amazing event, it highlighted ten champion commercial start ups in front of an audience of close to a thousand people.

If there was one word that was repeated throughout the evening, it was the phrase “impact”. How can the participants challenge and change their target community? The videos and speeches dutifully drove home the point, repetitively.

Since then, I have not stopped thinking about this word “impact”. It is incredibly obvious, and yet very powerful. So I applied it to several of my clients in business coaching and mentoring sessions. For example: –

  1. When approaching investors with a presentation, I asked what they that will say within 30 seconds that will force the listener to respond: “Wow, I must be a part of this”?
  2. When selling  professional services – health, accounting, computing, etc – I questioned how their smile will ensure that the person signs up immediately without further pesky questions over the price and timing?
  3.  When talking with colleagues and employees at work, I urged my customers to consider what will motivate them to go the proverbial ‘extra mile’.

I can hear some of you asking: “Well is this not just my elevator- pitch?” In a sense, yes…but not only.

Too many of us glibly find a five line throwaway and hope that does the trick. The other person is expected to be impressed. What I am suggesting here is that those precious words strike the person in such a manner that they have to consider a change of approach. It becomes a ‘no brainer’.

Let me describe a case study, which I was involved with not so long ago. My client showed me a video, which she had created. Great idea, but it was boring and failed to highlight most of the leading strengths of her team. Awkward!

So, we discussed her positives, coated them with two emotional stories for flavouring, and guess what? People are beginning to listen to her. She is looking forward to recruiting some new customers of her own. She even left my Jerusalem office with a smile.

So what is it that you do that really make a difference on your target community, and how well do you carry out that task?

4 new coups for Israeli hightech

29 November 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel

For all the concerns about the future of the Israeli high-tech sector, November 2016 is turning out to be a great month for entrepreneurs in the Holy Land.

Item No’ 1: NEC, the Japanese tech giant and still known to many as Nippon, is about to open an r&d centre in Israel. This has been on the cards for a few months, and the move has also probably been enhanced by the waning influence of the Arab oil issue. Indications are that the centre will be run by Ze’ev Weiss, former army intelligence, and will concentrate on cyber security in the first stage.

Item No’ 2: Back in the 1980s, I used to read about a small kibbutz company, located near the Sea of Galilee, called Degania Medical (DM). Today, that enterprise has mushroomed into a world manufacturing leader of catheters and silicone medical products. DM is about to be sold for around US$250 million to the American giant Q Holdings. As the kibbutz owns 30% of the company, that will result in a tidy windfall for the Jordan Valley farming community.

Item No’ 3: Staying in the medical sector, it was announced yesterday that the “US company Edwards Lifesciences Corporation is acquiring the Israeli valve repair device company Valtech Cardio Ltd.” The total value of the deal is placed at about US$1 billion.

Item No’ 4: In a different light, it is wonderful to see CNN covering the growing position of Israeli high-tech in the automotive sector. Considering that Israel has almost never been a part of this global industry and recalling the history of the Arab oil boycott, it is somewhat ironic that Israeli knowhow is driving – pun intended – international road safety, self-driving cars, car safety and much more.

And what will December 2016 deliver for the start up nation of the Middle East and thus also the rest of the world?

One golden rule when charging for your service

28 November 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel, Jerusalem

One of the classic questions that I am often asked as a business coach is how much should people charge for their services.

I am a trained economist by profession. So I dutifully profer advice about the level of the direct costs, including raw materials. Then there are overheads, such as rent. And ignore at your peril financial charges, including loans to be repaid.

Of course, there may be local factors to consider. This is not just a case a looking at the state of the competition. For example, many of my clients are based in Jerusalem, where there are two predominant population groups that force prices downwards.

However, beyond these issues is a factor that many buyers will gleefully encourage you to ignore. And this is where you, as the seller of your product or service, stand to lose big time. Let me illustrate what I mean with a fable that my wife sent me. (I assume that it is taken from somewhere on the internet).

A ship engine failed. No one could fix it. They brought in a man with 40 years. on the job. He inspected the engine carefully, top to bottom. After looking things over, the guy reached into his bag and pulled out a small hammer. He gently tapped something. Instantly, the engine lurched into life. The engine was fixed! 7 Days later the owners received his bill for 10k. ‘What?!’ the owners said ‘You hardly did anything. Send us an itemized bill. ” The two-line reply simply stated …..A) Tapping with a hammer – $2 B) Knowing where to tap – $9,998

Don’t Ever Underestimate Experience!

From a slightly different angle, I will illustrate this point with a true story. A client of mine was recently asked to quote for a contract, a piece of work which he would really enjoy to secure for a multitude of reasons. How should he present his position and win through, I was asked? So I created the following exercise.

Step 1: Think of a high price you would like to charge.

Step 2: Think of a low price that would almost definitely secure the contract.

Step 3: Consider in specific detail the time to be spent in direct meetings, travel time and preparation time. Do not try to minimize these items, because that is rarely a realistic approach!

Step 4: Internalise how your efforts will make a significant difference to the commercial life of the potential client.

Step 5: What is the true value to you of that time?

Step 6: Be honest…………is the answer to Step 5 closer to Step 1 or to Step 2?

Again, never underestimate the value of your experience. And that is expressed in the amount of time you invest, whether it is two minutes or two months.

Norms of government in Israel. That sinking feeling

24 November 2016
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Categories: Afternoon Tea in Jerusalem, Business, Israel

Binyamin Netanyahu has never been over-liked by the media, whether playing at home or on an overseas pitch. Like a football, he is simply booted around by jealous opponents, who want themselves and their friends to have more power.

Does he care? Quite honestly, he grew up as an outsider in the USA, and I suspect that is still part of his psyche today. The question is has the press got it right this time? After all, the Israeli press has already seen in recent years a former Prime Minister and former President go to prison. So is Netanyahu, or Bibi, as he is colloquially known, next in line?

Bibi has often been associated with scandals. Little has come out of them.

Then a few months ago, his wife, Sara, was found guilty of abusing an employee.  The problem is this was second time around. The press had fun describing – who knows the truth – the apparently bizarre lifestyle of the Prime Minister’s residence.

Next has come the strange stories surrounding the Netanyahu’s eldest son, Yair. At 25 years of age, it seems that he is becoming a proverbial ‘power behind the throne’ of his father. (Bibi is Israel’s longest serving Prime Minister.) Nothing necessarily wrong in his role of advisor. But look at the company Yair keeps!

One of Bibi Junior’s closest friends in James Packer, scion of the Australian Packer media empire. It appears that Packer’s Israeli lawyer has approached the Minister of Interior himself to receive a special visa for his client for his long stays in the country. OK, but that same lawyer may have also represented Bibi in the past. To me, that sounds just a bit too cozy.

Maybe I could accept all that, until the submarine story emerged at the end of last week. As background, last month, Israel agreed to purchase 3 submarines from Germany, even though the former Minister of Defense had objected to the deal.

It has since emerged in fits and drabs that Bibi’s private lawyer, David Shimron, who has also been used for diplomatic missions, played the role of agent between the Israeli representative of the German manufacturer and the various parties in Israel. Shimron has denied ever discussing the subject with Bibi. And there is no real evidence to the contrary.

However, there is plenty of room for a conflict  of interest. To be blunt, why did Shimron not declare his intentions to all in the first place, so that could be no misunderstandings? And as one former senior civil servant asked: Israel has previously purchased from this manufacturer. So why is there a need for an agent to cement the deal?

It sounds so wrong. At this stage, the German company – whose track record on corruption ain’t brilliant – is conducting its own investigation. The Israeli Ministry of Justice is not opening a file, for now.

In parallel, the local press has been made aware that yet another investigation is under way against Bibi for possible money laundering. Again, there is no clear direction for now.

Individually, these stories can be explained. Together, for me, they add up to a pattern or norm of government that reminds me of ‘banana republics’. I utterly reject this form of government and rule.

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