The British Are Coming

Expect cocktails at DLD Tel Aviv to be packed with ICE.

The UK-based International Conclave of Entrepreneurs (or ICE, as it’s more commonly known) is sending a substantial contingent to the conference. Even the British Embassy is getting involved, hosting a reception for the ICE pack to meet Israeli entrepreneurs, officials and investors. “What we’re trying to do is build a lasting partnership in tech between Britain and Israel,” says Matthew Gould, the UK’s ambassador to Israel.

This year’s DLD conference in Tel Aviv will see a number of efforts to forge closer ties between Israeli entrepreneurs and their UK counterparts. Israel has innovative technology, entrepreneurs and chutzpah in abundance. It attracts more venture capital on a per capita basis than any other country, and it has more companies listed on the tech-focused Nasdaq than any foreign nation after China. Still, too few of Israel’s fledgling tech companies become global dynamos. Britain thinks it has what it takes to shift the “Start-Up Nation” into a higher gear.

“We believe the two countries are really complementary in tech and as you look at each individual tech sector we see some really amazing potential for the two countries, the two economies to work together, but that at the moment that potential isn’t being fulfilled,” says Ambassador Gould, who set up a UK-Israel Tech Hub at the British Embassy a year ago. “We have access to all of Europe, to our historical links in Asia and in Africa. The UK is a very good base from which to enter the U.S. market,” he says. “Secondly we offer skills in business development, in marketing, in product development, skills which fit very nicely with Israel’s technological innovation. So if you could get a team up between the technological innovation that Israel offers, the business development, the product development, the marketing development, the professional skills and market access that the UK offers then I think what Britain offers Israel is a fantastic opportunity to take its innovation global.”

Speaking at a recent event inside East London’s Tea Building, Index Ventures Partner and Seedcamp co-founder Saul Klein, who recently returned to London after nearly two years in Tel Aviv, said he sees a massive opportunity.

“There are now over two billion online,” Klein told an audience of mainly London-based entrepreneurs. “In the next 10 to 15 years there are going to be five billion people online. Most of those people are going to be living in cities. All of those people are going to be on mobile, on the web.” In this new, more global marketplace, the argument goes, London and Tel Aviv are as well positioned to seize green-field opportunities as anyone from Silicon Valley, and perhaps in a better position if they work together.

“It doesn’t have to be a copy of the U.S.-Israeli ecosystem; there’s actually an opportunity for it to go in a different direction,” says Saul Singer, who co-authored the best-selling 2009 book Start-Up Nation. Singer, who was speaking at the same event with Klein, observes that “just as people are good at different things, so are countries.”

While Britain has expertise in storytelling, design, culture, finance, being a global, multicultural hub with plenty of experience in generating big companies, Israel is particularly strong in developing innovative technology, problem solving and fostering start-up culture.

As emerging markets become more substantial and lucrative markets, Singer says the UK and Israel will benefit from exploring synergies. “Both the UK and Israel have the advantage of being outside the US. It’s very hard for Silicon Valley to think of start-ups designed to solve non-U.S. problems and starting with non-U.S. markets. I think the UK and Israel both need to reorient themselves toward innovating with and in emerging markets and perhaps we can do this together,” he says.

Through the UK-Israel tech hub, there have already been trade missions in both directions. A British media delegation headed by UK Culture Minister Ed Vaizey has traveled to Israel, and Israeli “water tech” companies have visited the UK. Several more missions are planned.

Still, when pressed to offer examples of tangible results, Ambassador Gould says it’s still too early.  “Sector by sector there’s quite a lot of stuff happening. This is not going to an overnight solution. This is going to be several years of hard pounding to try to entrench a partnership that didn’t exist beforehand,” he says.

The ICE DLD trip is an important part of that effort. “I’ve been speaking in general terms about creating a partnership between Britain and Israel, but when you start to build links between British and Israeli entrepreneurs, that’s when you really start to see sparks fly,” says the ambassador.

Taking trips is nothing new for the ICE network of entrepreneurs, which includes founders from some of the UK’s most dynamic young companies such as Huddle, Conversocial, Struq, Skimlinks, GroupSpaces and Branient. Participating in at least one trip per year is actually a condition of membership. But this trip is different.

“Previous trips would be more internally focused, within the group. By which I mean we’d go skiing and the prime business benefit is the network we build together,” says Joshua March, co-founder and CEO of Conversocial who helped organize the trip.

The ‘ICErael’ trip will include a reception at the residence of the British ambassador, visits to local innovation labs and meetings with Israeli entrepreneurs. Altogether, around 50 entrepreneurs, investors and trade-body officials from the ICE group are participating (see the text box).

Huddle co-founder Andy McLoughlin, who’s making the trip from Silicon Valley, says his motivations are part professional and part personal. “As a current resident of San Francisco and long-time member of the burgeoning London technology scene, I’m hugely intrigued by the West’s other great technology hub,” he says. “So much innovation has come from this small country that one can’t help but be fascinated to learn about what’s coming next. And the fact that I’m visiting with some of my closest, smartest, most-connected friends promises that the trip will be so much more than just a technology fact-finding mission.”

There’s optimism that the international voyage will ultimately lead to closer friendships between UK and Israeli entrepreneurs. “Networks are about having that quick dial,” says Alex Hoye, an ICE co-founder who has started several businesses himself and invests in many more. “It could be two years down the road and then we find out that somebody needs a special technology on facial recognition for their product or whatever and they know that person because they got to know them on this trip. You’ll never build that kind of relationship system if you don’t spend the time together.”

Ambassador Gould says he has high hopes. “It seems really strange that London is not an obvious place for Israeli tech companies, particularly because you need to be of a certain size for New York. You don’t need to be quite so big for London,” he says. “There’s a certain amount of history here. The AIM had, a few years ago, a series of Israeli tech listings and failures (see the story o page 6). So there’s sort of a slight mutual ambivalence on this, which is frankly time we got over. This is history, lessons have been learned and you move on. There’s a massive opportunity here that we should be fulfilling.”

—D’Arcy Doran contributed reporting to this story.

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