Crossing Death Valley Maital Marketplace Jreportjuly13 2015
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MARKETPLACE SHLOMO MAITAL DEATH VALLEY, which sits between Stock Exchange (TASE). The conference Moshe Asher, head of Internal Revenue. California and Nevada, got its name in was initiated by Wix, a web development The TASE venue, a lovely new building 1849, during the California Gold Rush, company, one of the few companies suc- on Tel Aviv’s Achuzat Bayit Street, is sym- when 13 prospectors died crossing it in cessfully crossing Death Valley (see The bolic. The TASE is in decline with both a wagon train on their way to the gold Jerusalem Report, March 9), and spon- falling turnover and fewer listed firms. The fields. It has the world’s highest recorded sored by the business daily Calcalist. number of public companies trading on temperature, 57 degrees Centigrade, and Earlier, Beinart told TheMarker’s Meirav TASE has dropped 27 percent, from 654 average yearly rainfall of only two inches Arlosoroff, “We have a financing failure. in 2007 to only 475 in 2014. As many as a (five centimeters). Crossing Death Valley is Mid-sized companies with annual sales of quarter of currently listed firms are think- perilous. around 20 to 50 million shekels ($12.5 mil- ing of delisting. Israel has its own Death Valley, accord- lion) and a market cap of NIS 150 million The decline at the TASE, which Bein- ing to Yossi Beinart, Chief Executive Offi- run into funding difficulties. They don’t art is mandated to reverse, is paradoxi- cer of the Tel Aviv Stock Exchange. It is the want to increase debt and prefer to raise cal because Israel is drowning in money. arid financial desert for mid-sized Israeli share capital, but they’re too small for the Pension-fund assets are at a record NIS 1.2 firms that are no longer infant start-ups; Israeli stock market. So, in the end, they’re trillion ($308 billion ‒ about the size of Is- that need a lot of capital to attain sustained sold.” rael’s Gross Domestic Product) and bond independent growth; and that “perish” (i.e., The gathering brought a group of mid- and stock prices are at record highs. But, are swallowed by bigger firms) due to, sized companies seeking independent for many reasons, start-up companies that among other things, lack of money. growth together with key government of- choose not to exit prefer other stock ex- Beinart spoke at the first Israel Growth ficials such as Avi Licht, Deputy Attorney changes for their initial stock issue, such Conference, held on June 1 at the Tel Aviv General (Economics and Finance), and as America’s NASDAQ, where 63 Israeli 34 THE JERUSALEM REPORT JULY 13, 2015 AVI KATZ AVI Crossing Death Valley It is very difficult to do business in Israel, especially for a start-up seeking to grow independently firms are traded. Of those, 46 are also listed in July 1993. Since then, not a single Israeli other countries. They perform nearly a on the TASE. Most start-ups find it far eas- start-up has grown to global size. Mean- dozen different ordinary business activities ier to sell to a big multi-national rather than while, despite its extremely strong curren- – paying taxes, registering a new firm, list- scale up and remain independent. Mean- cy and astronomical wages, Switzerland ing titles for land, collecting a debt, and so while, as much as half of new pension-fund has $300 billion in annual exports. on – and measure the time and expense. In assets are invested abroad, rather than in It is crucially important to know why Is- 2015, Israel ranks only 40th overall in “ease Israel. rael is not Switzerland. Start-ups that are of doing business”; 53rd in ease of starting acquired often see their ideas relocated to a business; 121st in getting a construction ADDRESSING THE conference, I asked other countries where they generate jobs permit; 109th in getting electricity; 97th in the participants: Israel is not Switzerland and exports. Those benefits are thus lost to paying taxes; 135th in registering property; – Why? Israel. Why can’t start-ups scale up here at and 111th in enforcing contracts. In con- Switzerland, like Israel, has about eight home? Why is the start-up nation not also trast, if you want to go bankrupt, it’s easy million people. Yet, Switzerland has 48 the scale-up nation? – Israel ranks 24th. companies on the Forbes magazine list of I gave a very simple answer to this com- Dealing with bureaucracy is not a prob- the biggest 2,000 global companies. And, plex question. It is not just lack of money. lem for giant whales, which have armies no, they are not all banks. Fewer than a It is simply very difficult to do business in of people to deal with it. But for minnows third are in financial services. In contrast, Israel, especially for a start-up seeking to struggling to grow up, it’s a hassle. When a Israel has only 10 companies on this list, grow independently. huge check is offered by a foreign acquir- and just two, Teva and Check Point Soft- Each year, the World Bank has its experts ing firm, it is tempting to grab it rather than ware, are non-financial. Teva is older than in Israel measure how hard, or how easy, battle daily with mountains of red tape. Methuselah, and Check Point was founded it is to do business here, compared with It is frustrating to me, and to companies THE JERUSALEM REPORT JULY 13, 2015 35 Jewish Identity The Dream Behind Bars By Ruth Shamir Popkin The Story of the Prisoners of Zion from Ethiopia By Baruch Meiri However difficult it may be to accommodate the many The heroic story of complex and continually Ethiopian Jewry’s modern changing Jewish identities day suffering, struggle and under the single roof of exo-dus to the Promised Judaism, Dr. Shamir Popkin Land is told in this book. contends that we have no Meiri and Elazar document alternative – neither for the ter-rifying experiences Israelis nor for the Jews of the Diaspora. But if that of the Ethiopian prisoners overarching identity is to of Zion and the dramatic be preserved, Jews must rescue missions of internalize the core ideas of Operations Moses and multiculturalism to create a Solomon to airlift them NEW multifaceted Jewish identity from Sudan. RELEASE that positively reflects the freedoms of today’s world. HC | 336pp | ISBN 9789652296719 | $24.95 | 100 NIS HC | 200pp | ISBN 9789652292216 | $18.95 | 69 NIS Me and the Middle East Peace in the Making Days of Ticho By Richard Oestermann By Zvi Harry Hurwitz & Yisrael Medad By David Reifler From his escape with Here, for the first time, is the Dr. Avraham Albert Ticho the famous rescue of the complete correspondence was a Viennese-trained Danish Jews during the between Israel’s Prime ophthalmologist who immi- Holo-caust and throughout Minister Menachem Begin grated to Ottoman ruled fifty years as a Middle East correspondent for and Egypt’s President Jerusalem in 1912. There Scandina-vian newspapers, Anwar el-Sadat as they he married his cousin, the artist Richard Oestermann has wres-tled with what would Anna Ticho, and together they found himself at the crux become their Nobel Peace made their mark on the history of the great historical Prize–winning accomplish- of the Land of Israel. In Days of moments of our time. ment. Covering the period Ticho, the Tichos’ story is told Complete with from June 1977 until a day in all its fascinating detail. 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The guide on the personal lives and perspective on life in the is easy enough for the interactions of future prime land he holds so dear. beginner yet sufficiently minis-ters and national sophisticated that even leaders. the well versed can NEW appreciate it. RELEASE HC | 420pp | ISBN 9789654160155 | $24.95 | 88 NIS HC | 388pp | ISBN 9789652296399 | $29.95 | 110 NIS HC | 64pp | ISBN 9789652298003 | $12.95 | 50 NIS PB | 420pp | ISBN 9789654160193 | $17.95 | 80 NIS Look for us on | MARKETPLACE attending the forum, that this bureaucratic Licht, a brilliant and highly promising today if Check Point had not grown in- tangle is unnecessary, easy to fix and total- Justice Ministry civil servant, who rightly dependently, and instead been acquired.