High tech should be the growth engine that will drive Shared Capitalism in Israel, said PrivatEquity.biz Chairman Yaron Jacobs today at a conference at the Yigal Arnon & Co. Law Firm. Jacobs, who previously served as the Director General of the Government Companies Authority, spoke at the “The Exit - from an Event to a Process” conference before high-tech and financial CEOs and CFOs. PrivatEquity.biz is Israel's first secondary trading market platform,
Jacobs said, “Decision-makers in the Israeli business and government sectors don't grasp the dramatic change in thinking in the world about how the economy is supposed to work. Shared Capitalism means expanding the circle of beneficiaries of corporate and economic growth, and the key tool to achieve this is partial or full employee ownership, directly or indirectly, of companies.”
Jacobs continued, “This idea is spreading among a growing number of economists, researchers, companies, and Western governments, and is being promoted in democracies such as the US, UK, Ireland, and Australia. It is no coincidence that Shared Capitalism stars in speeches by US President Barack Obama and that employee ownership has become an important axis in British government policy. As a global industry, high tech should not be satisfied with being the growth engine of the economy, but should be the growth engine of Shared Capitalism and employee ownership in Israel. Israeli start-up and high-tech executives ought to be the first to realize that it is their paramount interest to expand the distribution of shares and options to wider circles of employees in high tech and in the Israeli economy in general.
“Employee ownership is not an abstract agenda for me. 15 years ago, I believed that employee participation in ownership through shares in government companies would be the secret formula that would allow me to successfully privatize six government companies within just one year when I was Director General of the Government Companies Authority. That is why I insisted that employees of companies being sold should share in the ownership of shares sold.”
Jacobs said, “PrivatEquity.biz’s online trading arena is Israel's first and leading platform for Shared Capitalism and employee ownership. Among other things, we advise managements to lead stock and option liquidity plans for employees, managers, founders, and other securities owners in pre-IPO companies on the secondary market. As part of this, private high-tech companies will be able to accompany and oversee the rules for selling employee shares and options on the secondary market, including pricing, amount, attached rights, and the timetable of the offers.
“As a platform for Shared Capitalism, PrivatEquity.biz provides a combined and optimal response for the three key parties: the companies, the employees, and the investors. Companies obtain the possibility of hiring and keeping the best employees, employees receive the possibility of meeting with the money irrespective of an exit or lack of one, and investors obtain a steady flow of new assets in which they can invest.”
Jacobs added, “In order to facilitate this process, we founded the first fund in Israel and one of the first in the world - whose capital is allocated solely for investing in employee shares and options in pre-IPO private high-tech companies. We are working to raise NIS 50 million for this fund."
Jacobs concluded, “Similarly to Sharing Economy companies such as Airbnb and Uber, the PrivatEquity.biz arena is based on the growing realization in the world that large scale cooperation is a key tool for prosperity that benefits everyone. Israeli executives should realize what the best businesspeople, economists and researchers in the world have already realized employee ownership boosts productivity and growth, as well as employee satisfaction, cooperation, innovation, and job security. All these factors will contribute to improve the performance of Israeli companies, help them attract more money from investors, and enable them to withstand economic shocks.”
Published by Globes [online], Israel business news - www.globes-online.com - on September 8, 2015
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