Israel ranked 17th in entrepreneurial study

In Israel, everyone is an entrepreneur. At least, sometimes it seems that way. Everyone knows someone who has started up some kind of venture, whether it’s related to technology, finance or industry. Sometimes I can’t believe how many people I personally know who have technology startups. Many of these ideas do come to fruition and succeed on a large scale. Look at Teva, Amdocs, and Comverse for some examples of the biggies, and see this list of the top 10 Israeli Web 2.0 wonders for a look at some of Israel’s most promising startups.

But how does Israel rank on a global scale for entrepreneurship? According to the GEM 2007 High-Growth Entrepreneurship Report, an annual report released by Babson and the London School of Business, Israel is ranked 17th out of 53 countries for friendliness to startups. This rating isn’t terrible, especially if you take into account that the only other Middle Eastern countries that even appear on the list are Turkey and Jordan, and they are ranked 33rd and 47th respectively. The top four countries in the survey are New Zealand, US, Canada and Australia.

But if you look closer at the survey, it becomes apparent that Israel is actually very competitive from an entrepreneurial point of view:

  • “The countries with arguably the ‘healthiest’ entrepreneurial anatomies…[are] Singapore, Israel, and China.”
  • In the comparison of “Adult-Population Prevalence Rate of High-Expectation (Nascent and New) and High-Growth (Established) Entrepreneurs in GEM 2000–2006 Countries,” Israel is rated sixth.
  • In the table titled “Relative Prevalence of High-Expectation Nascent and New (20 or more Expected Jobs) and High-Growth Established (20 or More Current Employees) Entrepreneurs,” Israel is rated second.
  • “In addition to Singapore, Israel stands out for its high relative prevalence of high expectation and high-growth entrepreneurs. “
  • “Of high income countries, the United States, Israel, Iceland, and Canada exhibit the highest adult population prevalence rates of high-expectation entrepreneurship.”

So that explains why it feels that everyone and their mother here are entrepreneurs. But is this thanks to government policies that encourage entrepreneurship? Yeah right. From my own experience, the government makes it anything but easy to survive as a small business owner.

I think that the high levels of entrepreneurship might come down to two things:

  • The Yiddishe Kop – this is Yiddish for “The Jewish Mind.” My grandmother always claimed there’s such a thing, and now a few goyim (non-jews) have backed her up. Jews always feel uncomfortable talking about this kind of thing, and the only reason I’m mentioning this is that some goyim claim this is so. While my grandmother is certainly an authority, I don’t know if her opinion is enough in this matter.
  • Perseverance – over 2000 years of attempted annihilation and successful genocide, and we’re still alive and kicking. If that’s not perseverance, well, I don’t know…

When Warren Buffett bought Iscar in Berkshire’s first overseas investment, he said that “Being in Israel has a major advantage of having the exposure to a fabulous pool of talent and brains. When we bought Iscar, we bet on brains.” Who can argue with the second richest goy in the world?