Hong Kong can learn from Israel's start-up experience, position itself as leading fintech and blockchain hub, Tel Aviv official says

By Lam Ka-sing kasing.lam@scmp.com / https://www.scmp.com/property/hong-kong-china/article/3044725/hong-kong-can-learn-israels-start-experience-position?utm_medium=partner&utm_campaign=contentexchange&utm_source=EdgeProp | January 14, 2020 10:36 AM SGT
Hong Kong can follow Israel's example of nurturing start-ups, and position itself as a leading financial technology and blockchain centre, an official with Tel Aviv's municipality has said.
Michal Michaeli, director of international economic development at Tel Aviv Global, a municipal company dealing with tourism and economic development under the mayor's office at the Tel Aviv-Yafo Municipality, said in a recent telephone interview that Hong Kong "could have been an amazing place", if it leveraged its financial hub status and exposure to trade to fund and groom more start-ups in commerce and trade.
"A lot of start-ups [and] a lot of ventures need funding, and they're definitely in the early stages. When you have access to funding, this can also be very important for an ecosystem to grow and mature," she said.
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Israel has 5,850 start-ups, or one start-up per 290 residents. The country is home to well-known start-ups such as website development platform Wix and web advertising platform Outbrain. "We do not have oil. We do not have coal, we do not have any special natural resources other than our minds. So we have to make the most of it," Michaeli said, drawing a comparison with Hong Kong.
"Why not go and be the leading fintech centre, for example, or the leading blockchain hub. The government should do at least basic research to understand what does it really have already," she said, adding that fintech was more than just mobile banking, and could include fields such as security and data centres.
Michal Michaeli, director of international economic development at Tel Aviv Global. Photo: Handout alt=Michal Michaeli, director of international economic development at Tel Aviv Global. Photo: Handout
Michaeli said she could hardly find any information about Hong Kong's start-up ecosystem. This suggested the city might need to do more to promote it internationally, even though it had signed agreements on cooperation with the United Kingdom and Thailand.
She highlighted Israel's experience with developing cybersecurity and artificial intelligence start-ups, and the role an influx of immigrants as well as its military had played.
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Michaeli said a boom in Israel's innovation start-up ecosystem began with a wave of immigrants from former Soviet Union countries in 1990s. Over a million people moved to Israel at that point. Many did not have jobs despite being educated, and Israel encouraged them to use their knowledge and experience to boost its technology sector.
"There were eight programmes " and these have been widened to 20 programmes " around the country that gave you funds just to sit, think and come up with good ideas," she said.
Currently, Israel's innovation authority has a lot of grants for opening offices and factories and starting new studies, for start-ups as well as established companies in different stages. "If you do not have money in the beginning, [an incubator] will give you the space and an envelope of services around it, like mentors, like connections with companies, which will meet your needs," she said.
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Israel's compulsory military service has played its part by providing its citizens with technological experience as well as leadership and management skills.
"The army is one of the best computer and technology schools [in Israel]," Michaeli said. "You [also] need to go to all kinds of combat units and get leadership and management skills from a very young age."
She said a culture of learning from failures had boosted Israel's start-up ecosystem. It has also allowed "start-ups to try and be flexible", and to be open to changing their ways.
Hong Kong must find out exactly what its specific needs are, as being a smart city is "not only having cameras everywhere and monitoring things, but also finding solutions for social problems", such as challenges its elderly community faces, Michaeli said.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved.
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