IBM has spent nearly $1bn (£640m) on four Israeli companies that all developed big data storage solutions: Storwize, XIV, Diligent and FileX. Earlier this year, Google acquired the mapping app Waze for more than $1 bn.
The founders of Waze received their technical training in Israeli military intelligence. The giant Israeli tech firms Nice, Comverse and Check Point were all created by Unit 8200 alumni or based on technology originally developed by the unit.
Across the boulevard, Yaron Tal is Chief Technical Officer of 6Scan, a website security start-up he founded with ex-army buddies. A white-hat hacker (one that works for non-malicious motives), since the age of 12, he was running his own web security consultancy by the age of 17, before being head-hunted for Matzov, the army’s cyber-security unit.
“Entrepreneurs in Israel are unique,” he says. “Their approach to problems is different to others because the army is a huge incubator for innovation and entrepreneurship. The army gave us a few million dollars at the age of 18 and asked us to build technology and systems that address problems that only people 10 or 20 years older are dealing with in other parts of the world. That kind of pressure and challenge really brings a lot of things out of you.”
Tal skipped university to work at a start-up before launching his own, but another important driver of the tech scene is the fact that Israeli university students pay only about $3,100 (£2,000) a year in tuition fees. They emerge from military service and three years of studying with zero debt, eager to take a year off to pursue their dreams.
That youthful exuberance, combined with the rigorous military training in technology and project management, has found a natural home among cafes running down the centre of Rothschild.
Recruiting to 6Scan became easy after they opened an office on the boulevard, according to Tal. “The street is full of start-ups. We talk together, help each other. There are no big companies here, which is great. We live very near the office. We love the vibe, the place, the other start-ups, the restaurants. It’s easier to bring developers to the company when you say it’s in Rothschild even though we don’t have much money to offer. We offer them equity and a good place to spend each day.”