Manufacturers Association sets up start-up unit

Director general Amir Hayek: A way has to be found to bring new entrepreneurial blood and ideas into old-fashioned manufacturing.

Sources inform ''Globes'' that, after years of failed efforts to bring Israel's old and new industrial worlds together, the Manufacturers Association of Israel has picked up the dusty gauntlet and is setting up a start-up unit. Yossi Vardi will serve as the chairman of the unit's advisory committee.

Since the rise of Israel's high-tech industry in the 1990s, there has been tension between the country's heavy industry leaders who run family and public companies, and the young men and women with university degrees who manage companies funded by investors.

This hostility is not just ideological. On the practical level, Israeli start-ups target global markets and have few ties with Israeli corporations. The start-ups also do not raise capital from the corporations, because they show little interest in Israeli technology anyway.

Last month, "Globes" reported on the difficulties facing Israeli cleantech companies, which need manufacturers to try their new technologies in the field. The Manufacturers Association wants to bridge this chasm. Its director general, Amir Hayek, raised a proposal which Manufacturers Association president Shraga Brosh has accepted in full.

"Globes": Why does the Manufacturers Association need a start-up unit?

Hayek: "The challenge is to foster the industrialists of the future. A way has to be found to bring new entrepreneurial blood and ideas into old-fashioned manufacturing. This is how we found a way to connect the two worlds."

How will the unit work?

"The unit that we'll set up will coordinate the activities of new companies that have an early-stage product and need an alpha or beta site. We'll help them contact manufacturers in all industries. The aim is to strengthen Israeli industry in the medium and long term."

Hayek says that the unit will also help start-ups contact investors and multinationals seeking business opportunities in Israel. "A representative of France Telecom is currently in Israel looking at new technologies. Representatives of other foreign companies also contact us. We can show them suitable companies."

Do you believe that this initiative will change manufacturers' attitudes toward start-ups?

"In Israel, as elsewhere, there is pressure on the bottom line, but I believe that we also understand that innovation and technology are the future. We will help manufacturers encounter new technologies that might interest them."

Manufacturers will gain from exposure to new technologies. What will the start-ups get?

"The Manufacturers Association is a highly networked platform, and we will offer entrepreneurs a wide range of services. For example, they often fly abroad to interest investors. We can offer them access to Strauss Group instead of Nestle. A company that can reach Teva won't have to go global pharma giants. Everyone will profit."

"The connection is right for all sides"

"The decision to set up the start-up unit at the Manufacturers Association fits us like a glove," says Brosh. "The new unit will offer Israeli industry new sources of entrepreneurship and innovation. The connection is right for all sides. Industry needs fresh blood that will bring creativity and initiative in fields that old industry lacks. Interesting ties will ultimately be created that will drive the Israeli economy forward."

The Manufacturers Association will officially announce the start-up unit and the services that it will provide shortly. Start-ups will be invited to register for membership for a token fee. Hayek promises to broker ties between the start-ups and the Israel Export and International Cooperation Institute, and with investors and foreign corporations. The unit will also help arrange beta sites. "We will bring the best people to deal with this, in order to help as much as we can," he says. <

Published by Globes [online], Israel business news - www.globes-online.com - on August 25, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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