Moving to Tel Aviv – A Guide for Startups and Entrepreneurs

YoStartups Team

Startup ecosystem in Israel is growing larger by the day as more and more entrepreneurs and startup job seekers are moving to Tel Aviv to be a part of it.

Israel’s success as a startup nation has made history. A young country full of lucrative opportunities for businesses, Israel’s startup strength lies in Tel Aviv, one of its largest cities. The city’s startup infrastructure has inspired hundreds to move to Tel Aviv and if you are planning to move here too, here is a guide to help you. The guide covers all the reasons why Tel Aviv is perfect for startups and which popular sectors you can consider to be a part of.

Tel Aviv is one of the three most populous cities in Israel and has a population of 3.7 million people. The city’s GDP is $153 billion, and its primary industries include mining, manufacturing, transportation, tourism, and technology.

What Does Tel Aviv have in Store for Startups?

Tel Aviv is a fantastic place for starting new business ventures as it has all the essential safety nets to help entrepreneurial ideas grow. One of the main reasons for the city’s success as a startup ecosystem is that it has a very innovative and young crowd. Close to 30% of the population is people between the ages of 18 and 35. Tel Aviv has the highest concentration of startups of Israel owing to the favorable business climate.

Move to Tel Aviv for a Global Visibility

Startups in Tel Aviv have been in the spotlight and been attracting international interest in them.  International giants have acquired some of the companies in the city. One of them is Waze, a navigation app, which was acquired by Google in 2013 for $1.3 billion after competing with other tech giants like Facebook and Apple for the acquisition.  Another notable story is that of Mobileye, an autonomous driving company, acquired by Intel for $15.3 billion. The activities of such big tech players in the city have got the startup ecosystem more attention from around the world.  Moving to Tel Aviv can help you get noticed by such big names and can be beneficial for your growth.

Startups in Tel Aviv have Excellent Government Support

The government of Israel is in a constant pursuit to nurture the startup culture in Tel Aviv and other Israeli cities in whatever possible way. One of the measures taken to help the city become a highly preferred startup destination is to introduce tax cuts. The corporate tax is less than 15% (depending on the business) and was brought down from 25% to help companies to grow.  Bureaucratic hurdles are also being taken care of so that entrepreneurs moving to Tel Aviv can set up their business smoothly without any hassles.

The Israeli government is offering the ‘ Innovation Visa’ for supporting technological entrepreneurship. Eligible candidates will get to stay in Israel for up to 24 months and will be supported by the Israel Innovation Authority and the Population Immigration and Border Authority at the Ministry of Interior (PIBA).

The Tel Aviv municipality will be soon launching a  free Wi-Fi program in more than 80 locations in the city that will be made available to residents and tourists. This is a part of the many initiatives aimed for transforming the Tel Aviv into a Smart City.

Move to Tel Aviv for its Rich Startup Resources

Tel Aviv checks all the boxes when it comes to providing an efficient infrastructure for startups to grow and flourish. Many young startups have bloomed stunningly with the help of the host of incubators and accelerators in the city.  Incubators in the city enjoy exceptional support from the government through the Israel Innovation Authority which is responsible for helping with 85% of the financial aid received by the startups in these incubators.  Accelerators, on the other hand, do not enjoy any such government benefits but have helped multiple investors and startups in Tel Aviv discover each other at par with the incubators in the country. The city is home to close to 90 accelerators.

Another valuable resource that can help startups grow is the network of shared workspaces.  The concept of co-working office has helped several entrepreneurs moving to Tel Aviv get over the hurdle of skyrocketing real estate costs and the other additional expenses of setting up an office. There are more than 15 co-working offices in Tel Aviv, each of them designed spectacularly and with all the amenities required for the smooth functioning of a business. Some of the popular ones include the Hubsphere, the Pub Hub, MIXER, Sarona Space and Urban Place.

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Startups in Tel Aviv form a Strong Community

Besides support from the government in the form of incubators and other support programs, moving to Tel Aviv will give you a chance to be a part of a healthy and supportive entrepreneurial community. Leaders of top ecosystem players in the city are open to offering advice and sharing their experience with budding entrepreneurs and startups moving to Tel Aviv. Israel has been shattering glass ceilings more than any other startup ecosystems in the world.  20% of the startup leaders in Tel Aviv are women making the city one of the top gender neutral ecosystems.  The growth of the startup ecosystem in Tel Aviv is further propelled by the many ecosystem partners like Startup Nation, Tel Aviv Global, Microsoft for Startups, Geektime, Microsoft Ventures and SOSA. Tel Aviv Global is a member of the prestigious Startup Genome and is dedicated to making the city a global innovation hub.

A Tech Sector Growing by Leaps and Bounds

The tech sector in the city is one of the strongest suits of Tel Aviv’s startup ecosystem. A considerable part of this growth can be attributed to the national military forces in Israel that have given some of the best tech talents to the ecosystem. However, the contribution of international tech professionals and startups moving to Tel Aviv cannot be denied as well. Some important sectors within the niche are:

Adtech Startups In Tel Aviv

This sub-sector boasts of several startups that are at the forefront at a global level. Adtech startups in Tel Aviv got 7% of the total venture capital since 2012, and the sub-sector is steadily growing in terms of the number of startups and the funding received. ironSource is valued at over $1 billion and is a company mobilizing monetary support and distribution solutions for developers.  Other adtech giants that have got fame world-wide are content marketing platforms – Outbrain and Taboola, both of which were established in Tel Aviv.

Automotive Startups In Tel Aviv

The automotive segment in the tech niche has seen unparalleled growth in the number of startups and especially funding. Automotive startups in Tel Aviv witnessed a 200% jump in the investments since 2015 and are helping to create a global hub for auto tech and other automotive technologies. The growth of companies like Waze and the setting up of research facilities by popular carmakers like Renault, Daimler, and Porsche has fuelled the growth of the automotive sub-sector in Tel Aviv. These automotive giants are encouraging startups in the region to grow by partnering up with those specializing in areas of smart mobility, automation, and collision avoidance.

Cybersecurity Startups In Tel Aviv

The cybersecurity sector in Israel is the second most prominent one in the world after the U.S when it comes to funding. 16% of the total global investments in cybersecurity was brought in by Israel with $814.5 million in venture capital funds and private equity in 2017. The contribution of Unit 8200 which is an Intelligence Corps of the Israel Defense Force has played an integral role in the development of this sub-sector. A lot of entrepreneurs are moving to Tel Aviv to grow with the help of Unit 8200 which has become an important incubator for cybersecurity startups. The sub-sector has seen some impressive exit deals like Fireglass which was acquired by Symantec in 2017 for a staggering $1.4 billion.

Tel Aviv has a government that staunchly supports innovation and one heck of a tech talent pool. The ecosystem offers an ideal climate for tech startups and entrepreneurs to move to Tel Aviv more than any other niche and is continually evolving to make it more favorable for businesses.

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This article is from Yostartups, YoStartups is a Pre Accelerator, and it empowers entrepreneurs to propel their business ideas into successful ventures. Yostartups’ core mission is to take the message of entrepreneurship to 1 billion people globally by 2020.

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