There’s trouble in Startup Nation
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Tel Aviv has fifth unicorn companies in the world. However, relatively little has been written outside of Israel about the key concerns local entrepreneurs are currently addressing. We spoke with one of them, MDI Health CEO Avishai Ben-Tovim. — anna
To SVB and vice versa
The exchange recently noted how Sweden punch above its weight in terms of startup dollars raised per capita. But Israel stands out even more when it comes to technology — so much so that the country is nicknamed the “Startup Nation.”
Israel’s tech scene is also remarkably resilient and relatively immune to the country’s local and global political woes. But in recent months, Israel’s startup ecosystem has been at the forefront of protests against the government’s controversial judicial reform plan.
Its opponents claim that the reform will harm Israel’s democracy and economy, in a country where the tech sector “accounts for about 25% of Israel’s income tax and contributes about 15%. to the country’s annual GDP,” according to Jerusalem Post Office.
Driven by these political and economic worries, major players from the Israeli startup sector have taken a public stance; risk indexfor example, “denunciation”[d] proposed reforms in Israel promote discrimination and threaten democracy.”
Others chose not to make official statements or officially joined the strikes, leaving it to their employees. But whatever their position, many are concerned about the economic consequences this political crisis could have.
These concerns have also turned into action, especially those related to finances. In January, Reuters reported that an Israeli venture capital fund and a local startup are moving their bank accounts out of Israel and others are also starting to find ways to keep their money in different locations.
MDI Health CEO Avishai Ben-Tovim is one of these. His medical technology company, has raised $26 million to date according to Database, are both Israelis and Americans. As political instability grows in Israel, it makes sense to make good use of your Silicon Valley Bank account… until it’s gone. Ironically, Ben-Tovim found himself in the position of transferring money back to Israel in a hurry before the banking institution fall.