ECONOMIC DEVELOPMENT

Hubs and Accelerators

Workspace

The Need:  Part of the “prosperity puzzle” is innovation infrastructure - the capacity to support new products, processes, and businesses through facilities, networking and consulting services. Hubs and accelerators are vital to an innovation ecosystem, the starting place for some of Israel’s largest success stories. Jerusalem has more than 21 hubs and accelerators but all are operated on a not-for-profit basis. While they charge rent to their participants, the market does not bear prices that can fund a hub’s programming that help entrepreneurs grow and scale. The rapidly growing innovation ecosystem should be accessible to all, particularly for population groups that thirst to be part of the city’s growing sector, from sustaining the creative class to entrepreneurs that seek to scale their operations on a global level. 

 

  • JEST: The only hub in east Jerusalem, JEST offers work space, courses, seminars, and mentorships for entrepreneurs in east Jerusalem. Traditionally stable careers have greater value in east Jerusalem and there is less of an innovation culture that tends to be seen, culturally, as high risk of failure. To counter this barrier, JEST developed the JOY program (Jerusalem Organic Youth) for high school students to develop their tech skills, and a high level Fast Track acceleration program for university students. Partners include the Jerusalem Development Authority and the American Consulate.
  • Bizmax: The first hub in Jerusalem for ultra-Orthodox males that offers a co-working space, consultants, seminars, advisors, networking events, and loans for development of businesses. Bizmax’s targets businesses that are partially developed yet require additional assistance. Partners include the Jerusalem Development Authority, the Kemach Foundation and Achim Global that offers loans and connections to ultra-Orthodox businessmen. Programmatic needs include: (a) Expert Day for start-ups to meet with business and tech leaders to assist in business development, marketing and connections with investors, (b) Reverse Accelerator, where Jerusalem businesses identify solutions they are looking for and start ups create the product for implementation, (c) Junior Developer Hub where less experienced developers sell their services to specific clients while receiving on-the-job advanced training during that time period, and (d) Accelerator for advanced start ups to develop a go-to-market strategy and investment.
  • ALYNnovation:  Alyn Hospital is a leading rehabilitative hospital for children, located in Jerusalem. Children from all over Israel come to Alyn suffering from various physical or mental disabilities that make basic life skills challenging. Alyn opened an innovation center for rehabilitative health, the first of its kind in Israel, to develop devices that improve quality of life – unique wheelchairs, wearables that assist in controlling computers, face recognition for parents to recognize pain in children with no voice, and more. Alyn will receive proceeds from devices incubated in their hub, reducing their reliance on philanthropy. Partners include the Jerusalem Development Authority, Cisco, Intel, IBM, Hadassah College and others. 
  • Siftech: The first accelerator in Jerusalem, 80% of Siftech’s portfolio companies are Jerusalem-based. They accelerated 70 startups, $15 million was raised by 30% of participants, and 40% of their companies are still operational. Siftech offers assistance to other hubs in the city, and their accelerator will be part of the programming for JEST and Bizmax to ensure the quality of incubated start ups. Partners include the Jerusalem Development Authority, Leichtag Foundation, Pratt Foundation, LeumiTech and more.

Impact:  In 2016 alone, there were 110 new start ups in Jerusalem, bringing the total to over 600 companies, accompanied by a 400% rise in investments from $50 million in 2012 to $250 million in 2016. Accelerators and incubators are given significant credit for facilitating early-stage efforts of promising young start-ups, offering platforms that are indispensable catalysts for up-and-coming companies that might not have otherwise taken off at all. A thriving hi-tech ecosystem is more difficult when some of the city’s diverse population lags behind in technological education and workforce participation, but the tech industry sees Jerusalem’s “forgotten” communities not as an obstacle to be overcome but rather as an opportunity.