On the Connection Between a Yellow Desert, Broken Tiles and Unicorns

Equality and Technology Entrepreneurship

Excellent entrepreneurship, the kind that manages to lead real change in reality, together with the sense of mission that lives within it both in routine times and when facing difficulties and challenges, requires dreamers to behave differently from most of the people around them. Despite the widespread popular belief about material abundance in the world of "high-tech," when it comes to startups the picture is the opposite. A startup demands almost total devotion. An ascetic, purpose-driven way of life, in which there is no other way to succeed but to give up indulgences, hobbies, job security and luxuries such as hours of sleep. In a startup, growth is so exciting and so accelerated that successes and failures are part of the daily routine, and if the goal is not clear and precise, the intensity can throw a person off balance and challenge even the most stable personalities. The statistics show this clearly: according to a study based on data from 10,000 startup companies in Israel, four out of every hundred startups succeed. In other words, there is a 96% chance of failing.[1]

Precisely in these days, when the value of equality is being eroded in national politics and the notions of entrepreneurship and innovation are being worn out by clichés in every possible context, I want to shine a spotlight on the problem inherent in the connection between the two, as I see it. In my view, the problem has two main layers, inseparably linked, which I will elaborate on below: how to increase the success rate in the world of entrepreneurship in general, and how to do so in the Negev in particular.

According to the Israel Innovation Authority's latest report from 2023, in 2022 the Israeli high-tech sector accounted for 48.3% of Israel's total exports, amounting to $71 billion [2]. Today, about 14% of Israeli citizens work in technology high-tech professions. This has deepened wage gaps in Israel: in 2022 the average wage in high-tech, which stood at NIS 28,385, was 2.7 times higher than the average wage in the rest of the economy (NIS 10,452).[3] As of May 2023, there were 98 unicorns operating in Israel, that is, private technology companies that received a valuation of at least one billion dollars in their latest funding round. In 2021, one in every ten unicorns in the world was made in Israel.[4] Impressive figures that have rightly earned us the title StartUp Nation. Or have they? If we dive into the data, we see that 77% of the employees live in the center of the country and only 3% in the Negev[5]. The data highlight what we already know: the concentration of the high-tech industry leads to significant wage gaps, in other words, inequality.

Still, some will object, and rightly so, that inequality is not reflected only in the gap between residents of the periphery and residents of the center. Examining the high-tech population in the following chart reveals glaring inequality on additional levels as well, and I believe the chart "speaks" for itself.

Welcome / Eeva Kilpi

תַּגִּידִי מִיָּד אִם אֲנִי מַפְרִיעַהוּא אָמַר כְּשֶׁנִּכְנַס מִבַּעַד לַדֶּלֶתוַאֲנִי תֵּכֶף מִסְתַּלֵּק

אַתָּה לֹא סְתָם מַפְרִיעַהֵשַׁבְתִּי לוֹאַתָּה מְטַלְטֵל אֶת כָּל קִיּוּמִיבָּרוּךְ הַבָּא

I grew up in Ofakim and in Be'er Sheva. My memories of the town are mostly of utter simplicity, broken pavement tiles, bored teenagers hanging out on the "railings," and an arid yellow landscape. If I could "put my finger" on the factors that changed my awareness and gave me a fierce desire to change the reality I grew up in, for myself and for others, they were inspiring encounters. The "magic" that happens in an encounter takes different forms for me: it can be a paragraph in a book I read and keep returning to again and again; it can be a work of art I glimpsed in passing that moved me to tears; it can be an unforgettable lecture, a podcast or the recitation of a poem. And most important of all are the teachers, women and men, whom I have gathered along the way. This is an especially impressive collection of exceptional people whom I have been fortunate to know, and with some of whom I jealously keep a deep, years-long friendship. They are utterly different from one another, in their fields, their character, their style and even the values that guide them. Yet they all share one common denominator: all of them, without exception, took the road less traveled. The lessons they gave me are an inseparable part of me, and above all they reflect, on more than a few occasions, who I would like to be. In the world of entrepreneurship, and especially in accelerators and early stage start-ups, once you learn how to draw inspiration and find the right person to learn from, the learning curve, and the success that follows it, improve dramatically.

Daring to Dream?

Despite the grim picture that emerges from the data on founders' actual success and on how few of them there are in the Negev, I am filled with hope and with a sense of meaning and mission that stem from my encounters with founders in the field. I have been fortunate to mentor dozens of startups from all over the country, operating at global and local levels. Some are at the idea stage and some are at advanced stages of raising millions of dollars from investors. Through this experience I identified fundamental differences between founders from the center of the country and founders from the geographic and/or social periphery. These surprised me, and I will try to point them out intuitively, not based on research. It is not a lack of opportunities, or a gap in abilities, knowledge or resources, that could explain the extreme differences. When I sit down for one-on-one meetings with the different founders and enter into a conversation with them that goes beyond a purely professional one, I identify immanent differences precisely in the "soft skills": the sense of self-efficacy, confidence in the value I can bring to the world and in the price that I and those around me pay, and most striking of all – how far they dare to dream.

As someone who grew up in the Negev, where the fear of daring is expressed in the extreme, we were accustomed, not to say channeled, to sanctify modesty, to plan small and sensible goals and not to take unnecessary risks, certainly when it comes to job security. In my view, a deep understanding of the problem requires us first to recognize that the potential for realizing technology entrepreneurship is far from exhausted, that there is deep inequality in the world of technology entrepreneurship, and that the two are intertwined. Fully realizing the potential inherent in founders, women and men, in the absence of the value of equality is like a teacher shouting at a class to be quiet, like Don Quixote tilting at windmills. There may be small successes, but their impact is like a single flower in the vastness of an arid yellow desert.

[1] IVC Research center. Retrieved from: https://www.ivc-online.com/Portals/0/RC/Startup%20Success/Startup%20Report%201999-2014_PR_Final.pdf.

[2] Innovation Israel Magazine. Retrieved from https://innovationisrael.org.il/magazine/6677

[3] Ibid.

[4] Stanford business school. Retrieved from: https://www.gsb.stanford.edu/insights/what-makes-unicorns-special-these-numbers-may-hold-answers.

[5] From: https://fs.knesset.gov.il/25/Committees/25_cs_mmm_1761729.pdf