Australia/Israel & Jewish Affairs Council

Israeli innovation inspiring Australians

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"Innovation" is a centrepiece of Australian Prime Minister Malcolm Turnbull's agenda for Australia - and the government is looking to Israel for inspiration.

As the Prime Minister said yesterday at the Melbourne Institute's 2015 Economic and Social Outlook conference, "A key focus of our Government is innovation. I said earlier, we need to be more innovative, we need to be more technologically sophisticated. We will deliver next month an innovation statement, a set of policies that will focus on how we attract and retain talent, how we support and encourage start-ups."

At the forefront of planning this agenda is Assistant Minister for Innovation Wyatt Roy, who together with Robogals founder and 2012 Young Australia of the Year Marita Cheng, led an Australian delegation of 44 entrepreneurs, industry representatives and government envoys on a week-long expedition to Israel (Oct. 29 to Nov. 5), to inspire Australia's innovation agenda.

Little Israel has become an innovation powerhouse - it has per capita the largest number of start-up companies in the world, it is ranked number 2 in the world for venture capital funds behind the US, it has more NASDAQ listed companies than any other country besides the US and China, it has the world's 3rd highest rate of entrepreneurship, and Israel's scientific research institutions are ranked 3rd in the world.

Discussing the delegation's trip to Israel before he left, Wyatt Roy said, "They have the right culture, the right settings to drive innovation", adding, "We can't perfectly emulate Israel and nor should we try, but there is a lot we can learn." He also noted Israel's embrace of technology and entrepreneur subjects in education and the easy flow of investor capital for start-ups.

On Thursday, Mr. Roy spoke to the Open Opportunity Forum in Sydney via video conference, and suggested Australia should adopt Israel's "chutzpah" mentality.  He said:

"I've often said that we need to embrace the best elements of our culture -- that aspirational mindset, that 'have a go' mentality -- and support the underdog... Here in Israel, it's very much evident in every element of their society they embrace that Hebrew word, 'chutzpah', where they go out and they are prepared to take on an enormous amount of risk to have a go -- and they're not afraid of failure. Here in Israel they do fantastic research, and that's with scientists, much like we have at home, but they really are quite able to cooperate in a very effective way between the government, higher education, science, research, and the private sector... And I think there's an enormous amount that we can learn."

The Australian Young Entrepreneurs Trade Mission has attracted attention both in Australia and Israel.

The Australian Financial Review reported on the delegation's meeting with co-author of "Start-Up Nation" Saul Singer:

"Saul Singer, who co-wrote Start-up Nation, told an Australian trade mission in Jerusalem that if Australia joined forces with Israel it could become the innovation leader in the Asia-Pacific region...

Australia's Assistant Minister for Innovation, Wyatt Roy, introduced Mr Singer to the Australian trade mission...

Mr Roy told The Australian Financial Review that Australia needed to ‘hand the microphone to entrepreneurs'. ‘We need to... celebrate success and make entrepreneurs into the rock stars that they need to be,' he said.

Mr Roy said he was in favour of Australia adopting something similar to the Israeli approach for disseminating government funding for start-ups called the Office of the Chief Scientist.

‘Back home, people will think of government funding where there is a market failure,' he said. ‘But if there is a market failure in Israel, people will say: 'I am not going to invest here'.

‘If you only get the Chief Scientist funding something, people would think you are a failure. The success of the Chief Scientist funding is the brand of the person behind it. It is not the brand of the shiny government structure; it's the brand of the individual.'

He said Israel's Chief Scientist, Avi Hasson, was a cult figure among investors in tech companies. Mr Hasson is advised by leading venture capitalists and successful technology founders.

Former Queensland premier Campbell Newman said during the vote of thanks that Australia was ‘at a bit of a crossroads'.

‘We all know that the mining boom of the last 15 years has run out of steam and as a result a whole lot of issues have been exposed across our country, which need to be dealt with,' he said. ‘This trade mission is about remaking Australia.'"

Moreover, Scott Middleton, CEO and founder of Terem Technologies, an Australian company that develops custom software and technology solutions for corporate innovations and high-tech ventures, was on the delegation with Mr. Roy and has written articles on Israel's start up scene for Technology Spectator. In his article, "A nation of brand ambassadors", he writes:

"Israelis are an arrogant lot. I mean that in a good way. It's a characteristic that strikes you from the moment you touch down in Israel and it can be jarring for an Aussie used to the humility of a tall-poppy culture. This self-confidence, combined with a deep level of patriotism makes Israeli's [sic] great brand ambassadors for their innovative, entrepreneurial culture.
Many Israeli businesses go off-shore to find global markets and build growth, but they never lose their sense of identity and their passion for the country. Because of this they become great brand ambassadors, selling Israel's capacity overseas and selling the strengths of the country's tech innovation community. Not all countries have as much confidence as Israel. But few have as little as Australia."

And in another article, "The R&D business case for acquisitions in Australia", Middleton comments:

"One noticeable feature of Israel's innovation ecosystem is the maturity of the relationships between start-ups, established businesses and the government. A significant proportion of multinationals now undertaking research and development in Israel use acquisitions as a way of plugging innovative processes, culture, products and staff into their businesses."

In Israel, the Jerusalem Post noted that two important Australian conferences were taking place in Israel in recent weeks:

"One is here under the auspices of the Australian Strategic Policy Institute, and its members are interacting with colleagues from the Begin-Sadat Center for Strategic Studies on matters relating to Australia's security challenges.
The other is a young innovators and entrepreneurs delegation, which is in Israel under the auspices of the Australia Israel Chamber of Commerce...
Co-chairmen are MP Wyatt Roy, Australia's assistant minister for innovation, and Marita Chang...
For the majority this is their first trip to Israel, and they are full of admiration for Israel's hospitality, achievements and innovation. Roy, now 25, was first elected to parliament at the age of 20, and had the distinction of being the youngest-ever Australian parliamentarian. Even at this early stage in his career, he is already being hailed as a future prime minister."

The Australian government's agenda for innovation - including its Assistant Minister for Innovation - appears to be a key part of what it hopes to offer to the public as an economic reform that will improve standards of living and prepare Australia for the changing economy.

As Prime Minister Turnbull said yesterday in his speech, "If a policy doesn't work, chuck it out, if you see somebody is achieving your objective in a better way remember the sincerest form of flattery is plagiarism, copy them, take it over."

There is much Australia can learn from Israel's start-up scene as it develops its own innovation agenda. And as Saul Singer suggested, there is also the potential for partnerships that can only benefit both countries.

Sharyn Mittelman


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