"Then I got this crazy idea: Hire Bibi"

Zvi Marom  photo: Eyal Izhar
Zvi Marom photo: Eyal Izhar

BATM's Zvi Marom reminisces about when the prime minister worked for him, and offers tips for his current job.

More than 15 years after Benjamin Netanyahu resigned from BATM Advanced Communications Ltd. (LSE: BVC; TASE: BATM) in order to return to politics, resulting in the longest continuous term as prime minister in Israel's history, BATM founder and CEO Zvi Marom, Netanyahu's ex-boss, still remembers him as a dedicated and diligent international marketing consultant who opened quite a few doors for the high-tech company.

"He got a salary and options from us, like many other employees. The salary and the options were extremely reasonable, because the company was worth a great deal. I assume that he exercised them well, and made quite a bit of money," Marom says.

"Globes": About how much did it come to?

Marom: "I really don't know. I don't know when he sold. I'm not interested in it, just like I don't know and am not interested in what my other employees did with their options. I've no doubt, though, that he benefited from it. BATM has created a lot of happy employees in its time, and I hope it continues to do so in the future."

So Netanyahu was a happy employee?

"In my humble opinion, one of the happiest times in his life was when he worked for us. He really had time to be happy. How do I know he was happy? I saw it. He had many happy moments with me, and his talent emerged. Incidentally, I flew with him overseas several times on work trips. We flew economy class. I still fly economy class to this day. That's a scoop for you."

"A natural born salesman"

The 1999 elections ended in a Labor Party victory and the election of Ehud Barak, the party's chairman at the time, as prime minister. Netanyahu, who was elected prime minister in 1999, withdrew from politics in order to make money, and came to Marom's BATM. For his part, Marom was looking for "recognizable faces" - someone who was capable of promoting the company's affairs and opening doors for it in important places. "I got this crazy idea. We were a small company that wanted to make a breakthrough with interesting products, and I told myself that no one would be as good as our prime minister in promotion. The rest is history."

So Netanyahu came and the doors opened.

"Yes. He opened doors and worked hard. When he came to BATM, he was an international expert on the war against terrorism. When he left BATM, he became an international economics expert, and became Minister of Finance. He felt a real love for economics. I hope that he will direct his energies to this sphere again through reforms and changes that are good for the economy."

Is he better as prime minister or as a salesman?

"He's a man with talent. He did good work with us. Presenting and marketing is engraved in this character, and he loves it. He didn't come here for the money he was paid. He's a natural born salesman. He loves that contact. His salary was very good because of that.

"He had something more with us, however: he was always surrounded by a team of very professional people with no ulterior motives. There was no one there thinking of how to cast him to the dogs. This team always looked at situations very professionally."

You could say that such a work environment would not do him any harm now, either.

"In my humble opinion, one of the things he misses now is a kind of advisory committee of people who don't want, don't need, and can't get anything from the government: absolutely nothing. There are moral people and mentors in higher education or industry who are willing to do this, because they love the country. If the senior ministers, and maybe even the prime minister, had something like this, things here might be different. Israel has a great deal of suitable talent."

Give me one name, please.

"Yisrael Aumann, for example. It's very worthwhile hearing his opinion when you are going to plan several steps ahead. He's one of the outstanding men of his generation in game theory."

The problem is that the flatterers crowd in, leaving no room for anyone else.

"Now, too, when I manage a company, there are some people who like to flatter. I've never liked somebody who flatters, especially not when their flattery is in order to get favors. Now, when you're already a prime minister or a minister, you have to try to keep away from such people. The problem is that a large proportion of politicians don't keep away from them, and it boomerangs on them."

"Our politicians like rich people"

A few days before this interview, which took place in the BATM offices in the Hod Hasharon industrial zone, Roni Mana, a businessman and former associate of Benjamin and Sara Netanyahu, told Channel 2 in detail about his close relations with the Netanyahu family. He described excessively close relations, which cooled off, and later turned into dislike towards him.

"Here's a very good question: what was Roni Mana doing there next to the prime minister?", Marom wonders. "Did the prime minister fall all over him and grab him by force? He wanted to be there, and the same is true of others. They went there. So did Mr. Milchan (businessman Arnon Milchan, Y.A.). Our politicians have a weakness for rich people. It's not just Netanyahu. Every one of them has his rich people. Olmert and Sharon had their rich people."

Olmert is in prison because of that.

You're right. Sharon cleverly evaded going to prison, and so did Binyamin Ben-Eliezer, but this isn't a good method. These people want to be around power and authority, and it's a give and take deal that's good for no one. I wish our representatives knew who the people surrounding them were, whether it's on order to show off with a picture taken or to get something. These people didn't come for nothing."

But the bottom line is worrisome: we're talking about the prime minister and his wife, who are allegedly getting gifts and other favors from such close relationships. That's the definition of hedonism.

"There are two sides to the coin. On the one hand, there's no doubt that a picture of hedonism is emerging here. No one wants his prime minister to get expensive gifts. Whether that's true - I don't know. Not everything you read in the newspaper is correct. In any case, it's in a legal process, and what do we need more than police investigators and the State Prosecutor's people? Yes, it's not a good picture."

What's the other side of the coin?

"Personally, I don't care if the prime minister and his wife eat ice cream all day. Let them add raisins and whipped cream and order pizza, too, as long as the prime minister makes better decisions. If he has to eat a kilo of ice cream every day to do that, let them give him a kilo of ice cream every day. They don't pay him a big salary, but they give him plenty of trouble.

"In my meetings with Netanyahu, he worked crazy hours at night, so for heaven's sake, give him a cook to make supper for him. He's not living the life of Riley. He's the man who makes the most important decisions in our lives, so let them at least give him good working conditions. If his wife wants to eat ice cream, let her eat as much as she wants."

It's not ice cream. It's sets of jewelry, expensive bottles of champagne, high-quality cigars.

"So if she's begging for gifts, somebody should tell her to stop, and there are all sorts of people who can do that, including her husband. In the end, though, you have to ask a specific question: whether Netanyahu is meeting our expectations, and if not, who will?"

What is your answer?

"More could have been done. Is there a better candidate? I don't know. Some of the candidates are definitely not better. I've heard people from the Labor Party who want to be prime minister, and I don't like saying it, but a little modesty is necessary: if someone were to tell me to be prime minister, I'd tell him that I have no talent for it.

"Some of our politicians would make a bigger contribution to the country if they stayed home, regardless of whether they belong to the right wing or the left wing. I'm in favor of competition, but let it be quality competition. We have a problem: the Israeli political system drives the best people away. On both the right and the left, all sorts of people with megaphones have taken over the public platform."

"I talk with the prime minister"

Are you still in touch with Netanyahu?

"We talk - not twice a day, but we talk when it's necessary."

Do you tell him what you think?

"Yes, when there's a need, I tell him, and I hope he listens to me. For example, there was a plan he helped me a lot to promote, and now Minister of Transport Yisrael Katz is taking it over - the islands plan. In my opinion, this is a phenomenal plan for Israel, and maybe to a large extent for the future of the entire region, in the relations between us and the Palestinians.

"Israel is a small country, and the only direction we can advance in is the sea. The idea is pretty simple: we have all sorts of harmful facilities on land that one of our neighbors wants to blow up every two days. I'm talking about facilities for desalinization, liquefying natural gas, an airport, and an ammonia tank. If you make an island 10 kilometers off the coast, and put all these facilities there - why not? There are a fair number of companies around the world making such islands."

The problem is that such visions don't happen

True. Like other things don't happen. There's a common denominator between the islands plan and technological education, for example. These things don't happen for the same reasons. This is the reason why the government and the public sector in general should be judged by what they don't do, not whether the leaders eat one ice cream more or less, or even whether they get to work on time. I don't care anymore if there are or aren't islands off Israel's coast, but it will matter a lot to my children. The islands plan can be a national project, like the National Water Carrier, which will get support from everyone."

"Bothersome clerks"

Two months ago, Marom answered a call from the Manufacturers Association of Israel, and was appointed chairman of the Israel Association of Electronics and Software Industries, replacing Elisha Yanay. At his urging, it was renamed the Association of High Tech Industries. "I didn't want the job," he says, "but I have a capable deputy. They promised me help, including government ministers I met with, so I said it was worthwhile trying. If it works, great; if it doesn't, I'll go home."

Is it working?

"I don't know any longer. I assume that the chances of success aren't greater than the chances of failure. I get good answers, but the question is how much everyone will lend a hand and work in the direction I want."

How will you know that it's working?

"If we see a change in the trend, and if those who say they'll help, such as the Ministries of Finance and Economy and Industry, really mean it, that means that the general direction is positive. That should be reflected, among other things, in regulatory concessions, so that some of the regulators disappear, because they aren't good regulators. Look, I'm in favor of regulation, but real regulation, not regulation that empowers clerks and busybodies."

What's in store?

"There are several things. In the coming months, we'll present new financing arrangements of overseas financial institutions for the high-tech industries that have not been available to them. We'll go with it, while building financing instruments for Israeli companies. Maybe the state will also help reduce the risk in some cases, and maybe this will arouse the appetite of the institutions here.

"We spoke with new Minister of Economy and Industry Eli Cohen. We'll see that there's more emphasis on education in natural sciences and technology. There's willingness. Let's see what they do. I want to maximize the success of our high tech in the direction of creative and productive industries that affect the entire society."

How do you do that?

"Low-tech industries can't compete in the world by themselves, unless we want people to work here all their lives for a wage like in India. They need to be part of the high-tech industries' ecosystem, as support industries. That involves professional training and many other things that both we and the government have to do."

Professional training is something that hasn't been happening here for many years.

"True. If I lived on Mars, or was just interested in my own welfare, I wouldn't be an industrialist in Israel. The bottom line, though, is that a lot of money has to be brought from somewhere, because otherwise, no one will have it. A person can't give what he doesn't have. I can't give up because it was bad for 20 years, so I'm trying to improve it. If I succeed, that's great; if I don't, it's a great pity, but maybe someone else will.

"Israel's future is not being a big gas producer or the world's biggest car importer. If we don't build a company here based on high tech, it won't last. They’re starting to look in the right direction in education, which is technological education, and that's a reason for optimism. It's not enough, a lot more has to be done, but it's a least a start."

It is clear from Marom's remarks that he is pinning quite a lot of hope on Cohen, the new minister, with whom he recently met in order to promote measures that will benefit the local high-tech industry. "He's an accountant. He at least knows what gross profit means," Marom says with a straight face.

What about other ministers?

"You tell me."

A civilian Rafael

The high-tech company that Marom founded 24 years ago is one of the oldest communications equipment and biomed companies in Israel, and was among the first to hold its IPO in the UK market. BATM is currently traded on the London Stock Exchange at an $89 million market cap.

A decade ago, it began manufacturing body fluid diagnostic equipment for small and medium-sized laboratories, which was its growth engine and generated over half of its revenue. "We're doing here what they do at Rafael Advanced Defense Systems Ltd., but in the civilian sector," Marom says proudly.

At the same time, he is disturbed at the state of the high-tech industry, and is not dazzled by the Mobileye(NYSE: MBLY) exit. "Israeli high tech can't be taken for granted, and I'm not sure that it will stay here in the long run. The entire sector is stagnating. When they talk about an industrial policy, they have to think many years ahead. Yes, we have attained a certain maturity and gotten a certain reputation; the question is what comes next. How do you turn it into sustainable bucks for technological industry? It's not an easy task. It requires a great deal of planning, and unfortunately, we're not so good at planning.

"I'm glad that the Mobileye deal has made the government aware once more of the fact that there's a high-tech industry here, and it's serious. We should remember, however, that Mobileye was founded 20 years ago, like many other high-tech companies, and that's thanks to previous governments, not to the present government. The R&D and chief scientist's budgets, on the other hand, have been continually eroded. Investment institutions aren't investing in the high-tech industry."

Do you expect the state to encourage international high-tech companies to invest here in founding development centers, and perhaps to institute an easier tax system for them?

"The state should encourage anyone who wants to invest here. I don't know, however, how much establishing development centers should be encouraged. Development and production are two different things. When someone pays to establish a development center here, but takes all the production out of the country, I don't know whether it's any big reason to rejoice. Maybe it makes the engineer who earns 30-40% more than the average salary happy, but from the perspective of the good of the economy, I'm not sure that it’s a good idea.

"Such a company takes the local talent and all the money it earns away to other places. It's a negative contribution to society. It raises the average salary. It's not worthwhile."

The Prime Minister's Office is talking about importing engineers in order to fill the ranks in high-tech companies.

"Balderdash. The power of local engineering should be realized with the personnel we have here. Maybe we should attract experts with unique expertise.

"I also saw a plan to bring entrepreneurs to Israel, which was announced to great fanfare. It's one of most entertaining satires I've read since Ephraim Kishon. Unless the entrepreneur is the son of Theodore Herzl, he needs a very special reason to come here, because he isn't allowed to make any money for two years. Forget about it; some things are best left undone."

So you don't give the government a very high mark.

"You can't deny the facts. The government's contribution to higher education and research in Israel has not been good. You can find innumerable reasons, but the numbers don't lie. Our decline on international indices isn't a lie. For a moment, there's a pause. Everyone is enjoying other people's success. I hope that the present government, which is showing signs of good intentions, takes the right measures. Up until now, we've regressed. You can say it all in a headline: 'Jewish Genius Needs Financing.'"

"All we have gotten from the stock exchange is masses of bothersome regulation"

Two years ago, Marom delisted BATM from the Tel Aviv Stock Exchange (TASE), and he has several comments that its managers should hear. "They promised us electronic trading between Israel and the UK, like there is between Israel and Nasdaq. The CEO of Nasdaq then was Esther Levanon. They promised us it would happen within three months, but it didn't happen, not even after 18 months. Meanwhile, the management has been replaced, a new CEO came along and made exactly the same promises we had already heard. After almost three years, we got fed up with the promises. It was clearly all nonsense. The only thing we got from the TASE all the time was masses of bothersome and irritating regulations, some of which were totally irrelevant to us. Even when we wanted to buy shares in Israel, the TASE gave them no advantage over the London Stock Exchange, for example. We realized that it wasn't going anywhere, so we said goodbye."

How do you regard the TASE as a source for raising capital for high-tech companies?

"If it doesn't improve, it's simply a waste of time. A stock exchange can't be a small grocery store. You've got a stock exchange where you can go and raise serious amounts of money, and investment institutions in Israel have huge amounts of money in their hands, but the fact is that they're going to other countries. The various regulators, such as the Israel Securities Authority, instead of figuring out how to make regulation business-like and specific, and not a disaster, are constantly inventing new kinds of regulations. You can't do business like that."

Published by Globes [online], Israel Business News - www.globes-online.com - on March 27, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Zvi Marom  photo: Eyal Izhar
Zvi Marom photo: Eyal Izhar
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