Israel launches $70m program to promote tech entrepreneurship in Arab community


225 million five-year program to promote high-tech in Arab society.

The Israel Innovation Authority and the Department for Economic Development of Minority Sectors at the Ministry for Social Equality, launch NIS 225 million five-year program to promote high-tech in Arab society.

  • The initiative is part of the Government’s “Impact for Arab Society” program led by Innovation, Science and Technology Minister, Orit Farkash Hacohen, and part of the “Takadum” (progress)  five-year plan for the economic development of the Arab sector led by the Ministry of Social Equality.
  • In the framework of the Program the Israel Innovation Authority will support the establishment and strengthening of innovative ecosystem, promote innovative technological projects with an emphasis on Arab communities in the periphery as well as promote the integration of Arab population in the high-tech sector.

Orit Farkash-Hacohen, Minister for Innovation, Science and Technology: “I was pleased to launch this new program, to be operated by the Israel Innovation Authority. Incorporating high-tech employees from the Arab sector is a highly important social, financial, and strategic need. Despite increases in the number of Arab students in academia, only 2% of high-tech employees are from the Arab sector. In this respect, during last November’s budget approval, we assigned five-years of additional budget for this purpose to the Israel Innovation Authority. This additional five-year plan will also operate in the areas of science and research within my ministry with additional budget that was attained for the purpose. I congratulate the Innovation Authority for joining this significant challenge, and for being a substantial engine for real change.”
Meirav Cohen, Minister for Social Equality: “The successful integration of the Arab population among others, in the world of Israeli high-tech is in the best interest of the industry itself. Over the last few months, we have been working in partnership with high-tech industry leaders, who have indicated the need to encourage technological enterprises and initiatives in the field. The more that we succeed in integrating more Arab workers into the Israeli high-tech industry, the more we will succeed in bringing Israel’s economic growth to additional segments of the population.” 
Dror Bin, Israel Innovation Authority CEO: “This program is designed to encourage entrepreneurship and high-tech employment among the Arab society. Encouraging entrepreneurship is the most difficult task because the number of start-ups being created by Arab entrepreneurs is extremely low in comparison with the rest of the population. The reasons for this are varied and stem mainly from the lack of relevant networking system, geographical distance from high-tech centers, fear of taking risks, and a preference for secure jobs over entrepreneurship – as well as a lack of access to investors. We developed this new ideation program as part of a government plan to promote entrepreneurship in the Arab sector, to provide the best possible solutions to these challenges, and to develop an entrepreneurial ecosystem in Arab society as part of the general strengthening of Israeli high-tech.”
The program will include a number of tools modified for the Arab community in Israel: 

  • Entrepreneurship Centers – Selected franchisees will be given an operational grant of up to NIS 2 million per year (in each of the five years of the franchise) and will work to promote local entrepreneurship and innovation in different geographic areas (with an emphasis on the social and geographic periphery); create a supportive economic and business environment for local entrepreneurs; to encourage the creation of a culture and ecosystem of innovation and entrepreneurship, in partnership with key local players (including local/regional authorities, industry, investors and more); and to offer a solution for every stage – from encouraging entrepreneurship and creating innovative ideals, the consolidation and promotion of enterprises, raising funds, and/or applying for support from the Israel Innovation Authority. The center can operate a technological accelerator, initiate meetups, mentoring programs, collaborations with major companies, and all programs aimed at the creation of innovative technological enterprises. In addition, these franchisees can also work to promote employment and the development of human capital for high-tech, by connecting to potential employers and through the establishment of branches of high-tech companies in the center’s area of operations. These activities will receive additional funding of up to NIS1 million per year (in each of the five years of the franchise).
  • Technological Accelerators – The chosen franchisees of these innovation accelerator programs will receive up to NIS1 million per year and will help new entrepreneurs, with an emphasis on under-represented populations and the periphery, to advance technological ideas and to make them feasible for business, including market validation, establishing MVP, support and mentoring, access to investors, technical and legal consulting, media coverage and training. 
  • Angels’ Clubs – These will be established by chosen franchisees who will receive funding of up to NIS 900,000 per year (for each of the three years of the franchise), to establish an Angel Club that will work to recruit investors and promote investment in enterprises in the pre-seed/seed stage through exposure to many ventures, with an emphasis on under-represented populations and the periphery, as well as building an organized process of investment that also includes due diligence. 
  • An Incubator to promote Arab Entrepreneurship – The Israel Innovation Authority will promote the establishment of a technological incubator operated by a chosen franchisee, aimed at encouraging entrepreneurship and the establishment of new start-ups among the Arab population. New companies established by the incubator will be awarded funding from the Israel Innovation Authority of up to NIS 6.5 million per company, at a rate of 74-85% of the approved budget. 

The Israel Innovation Authority expects to publish calls for proposals in the near future, for franchisees to run these programs. The first stage will be to encourage entrepreneurship and employment in Arab society through the use of Innovation Centers, Employment Centers, Accelerators, and Angels’ Clubs.

The new ideation program operated by the Israel Innovation Authority will emphasize the importance of advancing innovative technological ideas in Arab society and turning them into new start-ups, while working to increase the number of investors in these programs at the extremely early stages, in order to create the necessary conditions for inexperienced and unconnected entrepreneurs to lead successful high-tech ventures.