A new report from the San Francisco-based Bay Area Council Economic Institute, “From Silicon Valley to Silicon Wadi: California’s Economic Ties with Israel”, highlights the deep ties between the global innovation economies of California and Israel.
Based on extensive research and nearly 100 interviews, the report examines California’s economic footprint in Israel, Israel’s economic presence in California, the key technologies this activity is focused on, and future opportunities for collaboration.
Built on shared values ââand aligned interests, the relationship between California’s Silicon Valley and Israel’s Silicon Wadi is reflected in the growth of venture capital investments, large-scale acquisitions of Israeli companies, unicorns and state-owned companies. successfully founded by Israel in Silicon Valley, and large and bi-national R&D companies.
“Attracted by the search for engineering talent, Silicon Valley companies began their migration to Israel in the mid-1970s, a movement that has continued to the point where California R&D centers are ubiquitous today,” indicates the report. âSilicon Valley’s footprint is mostly reflected in its concentrated investments in software and IT services.
More highlights from the report:
â¢ From January 2003 to February 2021, Californian companies completed 147 foreign direct investment projects in Israel. Software and computer services were the dominant field, followed by semiconductors, financial services and communications.
â¢ 103 California companies invested a total of $ 22.4 billion in Israeli companies between 2003 and 2021.
â¢ California-based companies are responsible for 20 percent of all acquisitions of Israeli companies worldwide and 42% of all acquisitions by US-based companies.
â¢ Of 402 multinational companies with an innovative presence in Israel, 96 are headquartered in California, and 80 of them are from the Bay Area.
â¢ California is home to 140 Israeli-owned businesses that support 6,248 jobs, worth $ 615 million in wages.
â¢ California is home to 22 tech unicorns of Israeli descent, the largest number of any US state.
â¢ Three of the five largest Israeli acquisitions in history and seven of the top 15 acquisitions were made by California companies, including Mobileye and Moovit by Intel, Mellanox by NVIDIA and Waze by Google.
Silicon Valley-based companies such as Applied Materials, KLA Corporation, IBM, Oracle, Cisco, Salesforce and Intel exemplify the role Israel plays in global R&D and the business strategy of multinational companies.
“Intel, with 14,000 employees, is both Israel’s largest tech company and its largest private employer,” the report said.
Looking to the future, the report identifies promising areas for future cooperation such as biotechnology, data science and security, especially advanced cryptographic systems such as post-quantum cryptography.
âThe integration of intelligence at the edge of IT – via intelligent vehicles and road systems, for example – creates new security vulnerabilities. With more intelligence in the grid, there is a growing question of how to secure it, and with the world at an inflection point between data-driven connectivity and systemic vulnerability, a rich opportunity exists for collaboration. with Israel in areas such as AI and cybersecurity, âthe report predicts.