{"id":4436,"date":"2023-06-12T10:24:00","date_gmt":"2023-06-12T10:24:00","guid":{"rendered":"https:\/\/innovationisrael.org.il\/en\/?post_type=report&p=4436"},"modified":"2023-12-03T16:51:51","modified_gmt":"2023-12-03T16:51:51","slug":"decline-in-establishment-of-new-startups","status":"publish","type":"report","link":"https:\/\/innovationisrael.org.il\/en\/report\/decline-in-establishment-of-new-startups\/","title":{"rendered":"Decline in Establishment of New Startups"},"content":{"rendered":"\n
The introduction of the iPhone in 2007, the lower prices of cloud services, and further technological and economic changes, brought about a global growth in the rate at which new startups have been opened. Until approximately 2015, there was a surge in the number of new startups opened every year both in Israel and in other prominent hubs. Since then, the number of new companies opened in most of the hubs has declined. Why did this happen and does this trend constitute a problem for the continued growth of the Israeli innovation hub?<\/p>\n\n\n\n
<\/p>\n\n\n
<\/p>\n\n\n\n
<\/p>\n\n\n\n
In 2014, the number of new startups established in Israel stood at 1,400 companies, a figure that has steadily declined ever since. According to an Innovation Authority estimate, only 600-700 companies were opened in 2022. The Innovation Authority’s estimation is based on estimates of IVC and SNC publications. The figure relating to the number of new startups established during the past two years is still expected to rise due to the occasional delay in the reporting of data on the establishment of new companies. It is nevertheless clear that there has been a decline in the number of new companies established since the record years. As of 2015, Israel was the second largest innovation hub in terms of the number of new companies established that year. The other large hubs experienced a similar phenomenon of fewer new companies opened after the record years of 2014-2015, including those in San Francisco (the largest hub) and New York. In other hubs, such as London and Boston, the decline was more moderate than that recorded in Israel.<\/p>\n\n\n\n
The Innovation Authority and SNPI conducted a joint study to examine the reasons that led to the decline in entrepreneurial activity in Israel. A decline in the number of new startups: a worrying sign or natural maturation?<\/a>\u00a0(Hebrew).\u00a0The study revealed that since 2017, the number of new startups established each year dropped by 12%. According to a calculation that refers to an estimated figure from 2022.<\/p>\n\n\n\n