What does Apple have planned in Israel?

Maggie Lake speaks with Israeli venture capitalist Jonathan Medved about why the Israeli tech sector continues to boom.

Well, Jonathan Medved is one of Israel’s leading tech-venture, capitalist and is the founder and CEO of R-crowd, I spoke to him earlier from Jerusalem and I started by asking him about the PrimeSense acquisition, and what does it tell us about what Apple’s got in the pipeline.

This acquisition of PrimeSense with $350,000,000 follows their prior acquisition of Anobit for $400,000,000, Anobit was the maker of flash memory modules for the ipad. And they have also now announced they’re going to be building a major R&D center here in Israel, so this is yet another commitment of Apple to Israel. Now Apple is not alone in its commitment to the Israeli taxing, they are just drawing hundreds of other world leaders in technology who have been buying companies here, in fact, there are 300 different world technology leaders now have R&D centers here, most of them start their activity here by making multiple acquisitions with Israeli companies.

And why do you think that is, what are these start-ups in Israel doing that have so many of these big high-tech companies from silicon valley coming and shopping, is it the area that they are concentrating in?

Well, I mean look, we’re clearly the world’s second source of major innovation, when look at the world, you see a duopoly. There’s Israel and there’s silicon valley, and whether it’s in certain areas like 3D visualization or 3D emotion sensors, which is PrimeSense’s area, we’re ahead, we’re ahead in 3D printing, we’re ahead in all kinds of digital printing, we’re ahead in many kinds of social or mapping applications, whether it’s in medical devices or in internet technology or cloud technology, or in big data and analytics, Israel simply has a huge cluster of technologies. Each year over 600 Israeli companies are getting ventured capital funding. So it’s a very, very dense venture capital environment, these companies then grow up, they either get bought, or they actually go public in New York. And one of the interesting things about the New York Stock Exchange is that today Israel represents the 3rd largest country delegation traded in New York, the ranking in New York today is the United States No.1, China No.2, and Israel No.3. It’s ridiculous, it makes no sense when you look at our 8,000,000 country population, and you say how come you have so many companies traded or companies that are being bought, and the answer is Israel’s secret source relative to innovation.