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Mapping Weak Signals

Inspired by: FP7 » Innovation by Governmental Supported Start-ups and Entrepreneurships – the Israeli Model

version: 1 / created: 2010-08-09
id: #955 / version id: #955
mode: VIEW

Originally submitted by: Vanessa Watkins
List of all contributors by versions (mouse over)
Last changed by: Vanessa Watkins
WI-WE status:
submitted unpublished

Source of inspiration

European Commission Framework Programme for RTD (FP7)

Theme/activity of inspiration

Theme 8 - Socio-economic Sciences and the Humanities

Sub-theme/area of inspiration

Blue Sky Research on emerging issues and other research economies

Optional reference/s to FP7 project/s

Use the following format: Project Acronym (Project Reference No.). Use commas if more than one project is associated to this Wild Card, for example: ALFA-BIRD (213266), SAFAR (213374), LAPCAT-II (211485)
Source: INFU (225229) - http://www.innovation-futures.org/ http://www.economist.com/businessfinance/displaystory.cfm?story_id=14743944

Signal's headline

(max. 9 words)
Innovation by Governmental Supported Start-ups and Entrepreneurships – the Israeli Model

Signal's description

(approx. 150 words)
Please describe the Weak Signal (approx. 150 words)
Public funding for entrepreneurial hubs and start-up financing is nothing new. Many of the world’s most successful innovation hubs bear the stamp of governmental invention (i.e. Silicon Valley, Bangalore or Guangdong), but not all attempts were successful. The newest, most successful approach was taken by Israel. It shows how innovations pushed by governments and the promotion of entrepreneurships could look like in the future, also in many other countries. It also gives a clue on how to prevent the most common mistakes, e.g. to name areas of innovation, to overlook a lack of related supporting infrastructure (i.e. not enough skilled employees, no suppliers cluster,…). With the help of the Israeli government’s venture-capital fund (founded in 1992 with $100m of public money) Israel attracted lots of foreign venture capital and foreign expertise. In contrast to most other concepts, it lets foreigners decide what to invest in, and then government provided the needed public money. As a result, foreign venture capital poured into the country, high-tech companies boomed, domestic venture capitalists learned from their foreign counterparts and many new jobs and ideas were created. In 2008, Israel attracted as much venture capital as France and Germany combined. The country has more start-ups per head than any other country (a total of 3,850, or one for every 1,844 Israelis), and more companies listed on the NASDAQ exchange, a hub for fledgling technology firms, than China and India combined.

Keywords

innovation, policy-making, entrepreneurship, israel, venture capital

Signal's first apperance

2005-now

Signal's potential evolution

It could lead to...
issue type of issue/development potential impact on society timeframe for the issue to become at least 50% probable
#1 Change in current innovation patterns new/emerging
 		neutral
 		now-2015

Importance

please specify
please select
Level 2: important for a particular world region Emerging Countries

Key driving forces of this signal

Please use these boxes to provide up to 2 drivers of HIGH importance. Click on HELP to see examples:
Driver 1 Driver 2
Economic Increasing unemployment and global competition, the fact that in the last decades start-ups have accounted for almost all of the net job creation in most industrialized countries.
Political Policymakers from Berlin, to Beijing and Washington are beginning to look for ways how to create tomorrow’s jobs, rather than trying to save yesterday’s after the financial crisis.

Major risks & opportunities associated to the signal

Please choose the most appropriate timeframe option(s) to which you would like to provide inputs.
Risks Opportunities
before 2015 As strict economical criteria would determine investment decisions, and as economists tend to reduce risks, innovative ideas, which are at first sight unprofitable, would not be supported. This would bring up the need for alternative financing concepts for social innovations and those bringing a general benefit for the environment or the society. If more countries follow the Israeli model it could lead to a massive increase of international venture capital flowing around the world. Especially those countries so far not attracting much venture capital could profit from that. In the end, new and more innovations from different countries all over the world might be realized. The Israeli model is characterized by a great openness towards foreign capital and governments acting in the background as money provider. This could reduce the risk of governmental bad disinvestments, as the private secretor decides which ideas to promote.

Potential stakeholders' actions

short-term actions
(now-2015) 		longer-term
(after 2015)
Policy actors (at the international, European and national levels) if implemented, then this would bring up the need for alternative financing concepts for social innovations and those bringing a general benefit for the environment or the society.

Signal's relevance for European Grand Challenges

where? please justify:
particularly relevant Europe world
Economic prosperity/dynamics

Signal's relevance for thematic research areas

please justify:
particularly relevant
Regional development
International S&T Cooperation
Research for the benefit of small & medium-sized enterprises (SMEs)

Pan-European strategies influencing the signal

please justify:
particularly relevant
Developing and funding world-class research infrastructures

Research-friendly strategies potentially improving understanding of the signal

For further information about 'research-friendly strategies' click here
please justify:
particularly relevant
Strengthening the actors in the research-friendly ecology
(i.e. Research funding organisations, universities, businesses, Research and Technology Organisations, Researchers and Citizens)