Startup Nation

I’m a little embarrassed to admit that I’ve only recently read Startup Nation, Dan Senor and Saul Singer’s bestseller speculating on the origins of Israel’s startling economic success over the last decade. I’ve written about this phenomenon in the context of pointing out that Israel’s economy doubled in size during the very decade BDS was allegedly on its unstoppable march. But how and why this miraculous growth is occurring now is worth consideration, even beyond the context of how much it exposes the embarrassing lack of success of the boycott, divestment and sanctions “movement.”

An earlier treatment of this subject, George Gilder’s The Israel Test, was a bit of a disappointment. Not that the author’s heart wasn’t in the right place, but his portrayal of Israel’s success representing the victory of civilization, creativity and life over the forces of barbarism, envy and death just seemed too Manichean to explain trends that I suspected were grounded in the more down-to-earth, pragmatic factors usually driving economics.

Articles on Israel’s decade of success tend to focus on individual aspects of the country’s character: the national solidarity and character-building deriving from universal military service, the influx of huge numbers of skilled immigrants in the 1990s, the liberalization of the economy by then Finance Minister, now Prime Minister Benjamin Netanyahu. These all seemed to tell part of the story, but not the whole.

After all, other nations couple national conscription to meet existential threats with a commitment to export-driven economic success (think South Korea), yet they have not managed to create the eco-system required to support high-risk startups that are driving Israel’s growth. Immigration has proven to be as much of a burden as a boon to most nations, and even the notion that Netanyahu unchained the nation from the anchor of its socialist past ignores the spectacular nation-building that took place during Israel’s earliest years when the economy was its most statist.

As a business book, Startup Nation avoids the analytic pitfalls that often derive from reading economic trends through potentially distorting lens of global or domestic politics. Not that business books don’t suffer from their own problems, especially their tendency to “predict the present” when looking at current “hot” success stories. Think back to the 1980s and early 90s when bookstore shelves groaned under the weight of tomes hailing Steve Jobs as the penultimate genius, only to be reshelved with books featuring titles such as Accidental Millionaire exposing Jobs as a fraud, followed by today’s titles again celebrating the Apple pioneer’s brilliance. (Along the same line, one wonders how many biographies hailing the wonderfulness of business leaders responsible for the recent economic meltdown are in the process of being pulped.)

Startup Nation dodges these various bullets by taking an integrated historical approach to the subject matter. Yes, the conservative Netanyahu is a hero of the tale due to his dismantling of state enterprises that were standing in the way of growth in the 1990s. But the book also celebrates the left-leaning Shimon Peres for creating the very industries (aircraft, arms, etc.) that got Israel to a point where they had valuable national enterprises worth privatizing. In addition to exploring factors related to universal military conscription (high levels of responsibility and high-tech training at a young age, etc.), the book also explores the unique nature of Israel’s military where initiative and cross-service cooperation is celebrated, rather than stifled, up and down the ranks.

Humility is probably the greatest asset Startup Nation brings to the table, specifically with regard to pointing out that Israel’s current success owes as much to global changes in technology and economics as it does to the nature of Israeli society itself. Simply put, the world has transformed over the last 2-3 decades in a way that the unique strengths of the Jewish state (limited patience, flat institutional hierarchies, forgiveness of failure, acceptance of inter-disciplinary approaches to problems) happen to be just the factors that support the driving force of the new economy: entrepreneurial startups.

Other factors, such as support from the Jewish Diaspora and a culture which celebrates learning (represented by so many high-quality Israeli universities) play a part in the tale of Israel’s success, but those things have been in place since before Israel’s founding. If we were in an era when national wealth and power was derived from heavy industry requiring massive resources and the ability to mobilize large pools of unskilled labor, Israel would simply not be a player. But in an era when the ability to create and sustain high-risk startups is the world’s most valuable commodity, Israel is in the fortunate position of having the very qualities needed for today’s definition of success.

As my friend Sol often says, read the whole thing

6 thoughts on “Startup Nation”

  1. Oh what a great nation Israel is….isn't it!? With it's high tech industry, entrepreneurial spirit, and how it's economy has grown (thanks to netanyahpoo's privatization efforts and despite the existential threats).

    Your attempts to legitimize Israel, as honorable and justified as they may seem to you and as true as they may be from a purely economic/business angle, are illegitimate because so many aspects of Israel are blatantly illegitimate.

    The bubble of Israel you portray (a term we are all to familiar with here in the US) is just that: bright and shiny on the outside, no substance on the inside,
    and the bigger it gets the more it is bound to fail.

    The notion that the best way to fight the delegitimization of Israel is to legitimize it every chance you get without looking at the root causes of this delegitimization is a tat for tat fight you will ultimately lose.

    Your whole blog is a tit for tat. “The BDS movement wants to beat up on
    Israel so I will defend it by attacking the BDS movement every chance I get. I
    will delegitimize the BDSers with each blog and/or legitimize Israel with each
    blog.” Who is keeping score?

    Israel is armed to the teeth with the latest weaponry and is paid over $3 billion
    by the US each year. Everyone knows Israel can and will obliterate it's enemies. Has America's total and unconditional support for Israel (from
    congress to administration) brought about peace? So from a peace standpoint
    Israel has been a total and complete failure. Israel has failed with the help of the ultimate bully…the US of A, and you want to save it with your puny blog?

    Do you genuinely believe that the BDS movement is a bunch of antisemites who want to destroy Israel (we know poor DrMike thinks that)? I certainly hope not.

    Your hero, netanyahoo, has shown he has no interest in peace and the
    legitimate aspirations/needs of the Palestinians. He has aligned himself with the most racist, right wing coalition/party in the history of Israel whose leader, the settler/thug Lieberman, is a disgrace to Jews all over the world. Why don't you blog about the thug FM of Israel and what a great representative he is for the state of Israel?

    As I always say no justice = no peace.

    PS : Jon sorry to have shat in your cereal on and off for the past couple of months…..nothing personal.

  2. And no offense taken. I realize that as a lifelong member of the Palestinian hasbarah project, your job is to show up to sites like this one and post your generic messages, regardless of the substance of whatever article your posting about. I appreciate that facts are of no interest to you and regardless of what I write about, you are guaranteed to post the same dreary comments over and over again unless I do what your side always does which is to delete comments featuring dissenting opinion or not allow comments entirely (which I don't plan to do).

    All of this comes as part of the Palestinian hasbarah package, along with your never, ever under any circumstances assigning even a migrogram of responsibility to anyone other than Israel, your repetitiveness, and your projection of the flaws of Israel's enemies onto the Jewish state and projection your own faults (such as hair-trigger accusastions of bigotry, coupled with accusations that whatever I write about are merely nothing but empty accusations of anti-semitism).

    The fact that you post your dreary irrelevant accusation and Google bombs in a semi-literate matter means you pass the “polite” threshold mentioned below (just barely), even if you've never once posted anything that could remotely be called “interesting” (given that it could have – and probably has – been posted word-for-word on a hundred other sites already).

    So please feel free to take craps wherever you like. This garden is big enough that your self-declared turds will rarely be noticed by anyone other than yourself.

    Your welcome.

  3. 1st anonymous:

    I've read your posts, and you misunderstand what it is they do. Through them, you display your blind belief in your misconceptions. Your total blind acceptance of the fictive narrative of Fakenstinianism.

    The local Arabs departed for western Jordan in '48 to facilitate *actual genocide* (not the fake one you types accuse Israel of, abusing the term). A real one. Publicly exhorted to relocate temporarily by their authorities in order to make way for the Arab armies that will leave no Jews standing, whereupon they may return and choose from among the dead Zionists' homes and other improvements (after clearing out the bodies). Unashamedly. How nice. Makes you proud, doesn't it?

    Anyhow, “no peace, no state” sounds pretty reasonable to me.

    And anyhow, you imagine wrongly what your posts convey.

  4. Yes the Palestinians left their homes “voluntarily” in 1948 so their Arab comrades could come in and kill off the zionists. People living there for generations left their homes, roots, families, farms etc so the genocide could take place. And I am accused of accepting a blind narrative?

  5. To the first anonymous poster– please educate all of us, with quotes from the leadership of the BDS movement, to show us where they have said that DON'T want to end Israel's existence as the state of the Jewish people. Please show us quotes from the leadership of the BDS movement where they say that if Israel fully withdrew to the 1949 armistice lines (never recognized as borders) that BDS would stop. Please prove my statements about the BDS movement incorrect.

    I'm very sure you won't find statements like that, but it's very easy to find the opposite– BDS founders insisting that the Jewish people have no right to a state within any borders whatsoever.
    http://www.youtube.com/watch?v=tnpilMYsR0I

    And since that's what the demand for the fictional “right” of return means, the fact that it's the core demand of the BDS movement tells everyone what it's all about. So, why do so many BDS supporters in the US keep trying to draw a smokescreen over this, when your leadership keeps talking about it? Could it be that if people know the real goals of BDS that they wouldn't buy what YOU are selling?

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