Creating the next Silicon Valley is the new Holy Grail for cities around the world, but there’s no app for that — yet. Capital, mentors, education and entrepreneurial daring all play a role in the elusive ecosystem equation, but this year’s Cities Summit Tel Aviv will look at a broader thread: millennials. International experts are meeting in Tel Aviv to discuss what cities can do to attract, and hold on to, the army of youth who are founding, pitching, bootstrapping and powering start-ups around the world.
The one-day event on October 14th is part of the DLD Innovation festival, which is expected to attract more than 1,000 international visitors. During DLD Tel Aviv, Cities Summit founder Hila Oren is scheduled to moderate a panel entitled “Innovative Cities.”
“Tel Aviv is one of the youngest cities in the world — 35% of our population is between the ages of 18 and 35 — and it is the millennials of the city who are the innovators, working day and night to crack the innovation code and making the city alive and vibrant,” says Oren, who as CEO of Tel Aviv Global & Tourism, spearheads efforts to raise the city’s international profile.
The give-and-take between cities and millennials — a demographic sometimes also referred to as Generation Y or the Me Generation — will be explored in sessions featuring speakers such as Columbia University sociologist Saskia Sassen, an expert in globalization and international human migration; David Sable, the global CEO of advertising firm Y&R, which last year launched Spark Plug, an incubator that introduces start-ups to global brands; Donna Williams, the chief audience development officer for New York’s Metropolitan Museum of Art; and Scott Heiferman, CEO and founder of Meetup, an online company that encourages people to find offline experiences.
Millennials, who now number more than 80 million in the U.S. alone, are more diverse, educated, mobile, and tech savvy than any generation before them. About 77% plan to live in urban areas, a marked difference from their parents’ suburban flight, according to the Brookings Institute. They are constantly connected and thrive on collaboration. They are a force, by numbers alone, capable of reshaping, rebranding, repopulating, and redefining their cities for decades, the City Summit’s organizers say.
Already the new generation of tech giants has rejected the suburban business parks as companies like Google and Facebook base themselves in the hearts of cities to be closer to the talent pool.
“Start-ups want to be in the center of the action, where the ecosystem is thriving and happening,” Oren says. “That is why we see start-ups renting expensive real estate, in the center of Tel Aviv, just for the chance to be close to where everything is happening, in the non-stop rhythm.”
Tel Aviv has one the highest densities of tech start-ups, ranking number two globally after Silicon Valley in Startup Genome’s 2012 Startup Ecosystem Index; the Israeli city had the second-highest output of start-ups anywhere. Tel Aviv has more than 1,000 high-tech companies — Israeli and foreign — employing more than 31,000 people. Just under two-thirds of those firms are start-ups.
Tel Aviv’s entrepreneurial spirit goes back to when the city was founded in 1909 and built from the ground up near the Port of Jaffa, explains Mira Marcus, a spokeswoman for Tel Aviv Global & Tourism. Generations later, she says, Tel Aviv’s tech industry was built by entrepreneurs who do not fear failure and keep trying different ideas until they find success. That spirit and Israel’s mandatory military service, which gives young people exposure to responsibility, state of the art technology and fellow entrepreneurs, are the two biggest factors in the success of Tel Aviv’s ecosystem, she says
Between 2007 and 2011, exits by Tel Aviv-based tech companies totaled more than $3 billion, with the average exit during those five years valued at $43 million, according to government figures.
While overall, millennials account for more than a third of Tel Aviv’s population, in the city’s center that proportion rises to half. Tel Aviv officials realize young people are the creative class that give the city its character and have launched a series of initiatives to keep them in the city. These include Mazeh 9, a community center for the 21st century focused on services for artists, entrepreneurs, apartment renters, young professionals, and students, and the Social Lab, a municipal government-supported incubator for social entrepreneurs — a sector the city hopes can also flourish in Tel Aviv.
The Cities Summit emerged from Tel Aviv’s centennial celebrations in 2009 and reflects the city’s ambitions to become a diverse, global city. But along with that ambition comes an acknowledgment that Tel Aviv must compete for talent with other cities and ecosystems on the world stage.
“We live in a globalized world. If you’re in Amsterdam, how do you keep people from moving to New York or to London? Cities need to reinvent themselves. Cities need to become more innovative and that’s exactly what this conference is about,” Marcus says.
“Tel Aviv is a very young city and a young city has amazing challenges,” she adds. “How do you keep the young people here so that they don’t leave at the age of 25 and want to stay here and have their kids here? How do you improve education? How do you improve work? How do improve alternative transportation?”
The Summit’s organizers hope answers will emerge as participants share best-in-class experiences. Marcus suggests Tel Aviv can draw inspiration from Donna Williams, who has made the Metropolitan Museum of Art more engaging for multicultural communities. As growing immigration helps make Tel Aviv a more global city, its museums will need to be more accessible, she adds.
Likewise, the heads of Tel Aviv tech accelerators can learn from summit speaker Grace Sai, CEO and co-founder of The HUB Singapore, a community and co-working space for entrepreneurs, Marcus says.
“We’re going to have an opportunity here to have an amazing discussion about how does the economic system in Singapore work? What do people in accelerators there need? What do people in accelerators in Tel Aviv need?”
By being attentive to millennials’ changing needs and evolving demands, cities are investing not only in their ecosystems but are making themselves more robust for the future, the summit’s organizers say.
“Each city has their own challenges and each system has their own DNA — a start-up in Tel Aviv and a start-up in China are completely different and the ecosystems serve them differently,” Oren says. “We are excited to learn from other leading ecosystems that are coming to the summit — such as London and Berlin — and we are also excited to gain from the experience of evolving ecosystems in places such as Korea and Singapore.”