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Adding wings to a tiger: when Israel’s Silicon Wadi meets Taiwan’s high tech
Israel is identified worldwide as a "start-up nation", whereas Taiwan is identified as a "scale-up nation". How can the two join forces and take on the heating semiconductor challenge endorsed by leading tech companies around the globe?
Believe it or not. Israel, a small country with just over 9 million population, nurtured more than 7,000 startups in the past 30 years. Most impressively, in 2021 alone, there are 42 newly minted Israeli-built unicorns, which are start-ups that reach over US$1 billion market valuation. According to Israel venture capital firm Viola Ventures, Israel marks the highest number of unicorns per capita at 5.2 unicorns per million residents, a feat unmatched by any other country in the world.
Foreign investment is pouring into the Israeli economy. Living proof is the thriving tech hub Silicon Wadi, also known as the Silicon Valley of the Middle East (“wadi” means “valley” in Hebrew). Silicon Wadi is a strip of land near Tel Aviv, hosting scores of innovative startups and multinational tech giants such as Google and Intel.
Taiwan Trade & Innovation Center (TTIC) is also located at the heart of the bustling metropolis of Tel Aviv, where the tech ecosystem is vibrant. In the Middle-East country, Director Emma Yang is a scarce Asian slash female leader, and she traces back the adventure-like journey of setting up a Taiwan trade office in Israel.
“Since 2019, my team and I are working to understand the countries' strengths and synergies, and raise awareness of the amazing opportunities for collaborations,” said Yang.
From the beginning, full support was granted by both governments. In fact, it was James Huang, TAITRA’s chairman and Taiwan’s former foreign minister, who initiated TAITRA’s innovation activity in Israel, following a meeting with Asher Yarden, head of the Israel Economic and Cultural Office in Taipei at the time. Back In 2018, Huang and Yarden met at the annual tech extravaganza COMPUTEX Taipei, which hosts tech leaders such as Asus, Delta Electronics and Nvidia. The meeting sparked the realization of the great potential for Israel–the start-up country and Taiwan–the scale-up nation to collaborate closely.
James Huang, Emma Yang and the TTIC local team are the pioneers of Taiwan-Israel partnership. Their adventure is not without hardship, though, as Taiwan is far from a household name in Israel. “Taiwan is somewhat of an ‘unknown gem’ for most Israelis, which is why we have to promote awareness,” said Shany Kfir, business development Manager at TTIC Tel Aviv. The team sought exposure through hosting delegations from Taiwan, conducting webinars and conferences, distributing newsletters, media partnerships, and many more.
Following their efforts, the team effectively connected with Israeli startups, academia and venture capitalists showcasing Taiwan’s tech advantages. For example, they coordinated webinars with Quanta Computer (Taiwan’s top 5 electronics maker) and UMC (leading global semiconductor foundry) on the topic of electric mobility, held seminars at local universities, and invited partners from Taiwanese venture capital firm Taiwania Capital to attend tech conventions in Israel. Additionally, the Center is actively working with Taiwanese companies to identify and connect with Israeli partners.
Mutually beneficial partnership
The Taiwan to Israel market is like peanut butter to jelly, completing each other perfectly. On Israel’s part, start-ups there are globally-oriented from day one as the local market is not relevant in terms of size. Hence, Israeli start-ups seek for global partners as part of their funding, product development and global expansion.
Taiwan, on the other hand, is home to major industries like electronics, ICT, semiconductors, automotive, bicycles, and more. Partnership with Israeli startups can give Taiwan a competitive advantage. “With the Israelis’ outside-the-box thinking, it could give an innovative boost while enabling corporations to externalize risk-taking on specific tech developments,” said TTIC Director Emma Yang.
Taiwan-based semiconductor manufacturer Winbond is an early-adopter of Israeli innovation power. As early as 2005, Winbond set up an R&D center in Israel which later became Nuvoton’s Israeli branch. Currently, the two companies run major R&D centers in Israel, employing over 150 employees.
Another case in point is Foxconn’s partnership with Israeli AI chipmaker Hailo. In 2020, Foxconn announced a strategic partnership with Hailo to launch the next-generation AI processing solution for video analytics at the edge.
Other major Taiwanese partners in the Israeli tech landscape are TSMC, MediaTek, UMC, Pegatron and Asus, all big names in the global tech industry.
Relevant industries for Taiwan-Israel collaboration include aforementioned semiconductor supply chain, electronics, ICT, automotive and also advanced manufacturing solutions (I4.0) to support Taiwan’s upgrade of manufacturing process.
In a nutshell, corporations are able to elevate their value proposition by leveraging Israeli technologies. Israel’s innovation competencies can add unique capabilities to Taiwanese products, processes and business models.
Drivers for Israeli success: The people
Israel is well known for its innovative deep technologies, software capabilities, and new business models. For example, proteanTecs preempts chip failure by deep machine learning , solving common problems that TSMC or other chip makers have.
One might wonder how Israel succeeded on so many levels. One key ingredient is the Chutzpah mentality, which roughly translates to “audacity”. The valuable qualities lost in translation include ambition, opportunity to speak their minds for all team members, risk-takers, which are all the traits found in an Israeli that sparked their success.
The Chutzpah mentality is also commonly found on the TTIC team. Director Emma Yang said with confidence, “I was the only female candidate for this position. However, I did not back down from the various obstacles,” said Yang. “It was probably because I’m familiar with martial arts in Japan. That grew my audacity.”
Furthermore, government initiatives such as the Yozma and the Israel Defense Force (IDF) paved the way for Israel's startup-nation rockstar status.
The Yozma (Hebrew for "initiative") project in the ’90s, supported the buildout of the Israeli venture capital industry and played a crucial role in the Israeli startup ecosystem establishment. Combined with Israel’s high quality talent —almost 50% has received tertiary education, the third highest in the world, the Israeli start-up success speaks for itself.
Also noteworthy is the tight-knit community of the Israeli people. “People are eager to share their experiences within the tech community, which comes from a strong sense of trust,” said Shany Kfir, Business Development Manager at TTIC . Taiwan also is a place with close interpersonal relationships, and the shared trait is likely one of the success factors behind Taiwan-Israeli collaboration.
Seasoned local experts
“We’d be happy to hear from any interested companies,” said Director Yang. She encouraged Taiwanese companies to reach out to TTIC to initiate any kind of startup partnership program in Israel. TAITRA’s Tel Aviv Innovation center supports Taiwanese companies in establishing innovation partnerships and ongoing activity in Israel.
TAITRA’s Tel Aviv Innovation Center offers introductions to the Israeli startup ecosystem, networking opportunities and scouting programs tailored to each company’s needs and interests.
Since 2019, the local team has worked with major Taiwanese companies and investors in different industries, to support their innovation partnerships and activity in Israel, including a recent partnership with ASUS, to provide the electronics giant technology scouting services in Israel.
Director Emma Yang dedicated the rising presence of Israel-Taiwan global partnership to the local Israeli team.
The TTIC local team members: Shany Kfir, Yifat Unger and Inbal Asher boast rich backgrounds and knowledge of the Israeli startup ecosystem, while also sharing admiration and love for Taiwan and the Taiwanese people. Kfir previously worked as a consultant at Israeli Start-up Nation Central, Unger studied in Taiwan and accumulated interest in Taiwanese business, and Asher has economic, government and consulting experience in Israel’s tech ecosystem.
“Our aspiration is to see more and more Taiwanese companies collaborate with Israeli startups and participate in the Israeli tech ecosystem in an ongoing manner,” said the local team. Collaboration between the two like-minded countries vividly illustrates “adding wings to a tiger”, as the old Mandarin proverb goes.
©2022 Business Next Media Corp. All Rights Reserved. No.102, Guangfu S. Rd., Da'an Dist., Taipei City 106, Taiwan