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Is Israel the ‘Start-Up Nation’ Because of Its Security Situation?
The State of Israel is unique — it enjoys significant economic growth while maintaining one of the highest defense burdens of any country in the world. The reason for the high defense expenditure is that Israel has been engaged in a fight for its very existence from the day of its formation. Concurrently with the ongoing threat, Israel’s economy has grown rapidly, averaging around 4% annual growth over the last two decades.
Israel’s growth strategy is directly tied to investments in research, development, and technology. Science and technology have always been perceived by Israel as key factors in the power equation between itself and its surrounding adversaries. Israel’s expenditure on research and development as a proportion of GDP is one of the highest in the world at approximately 5%. The country’s emphasis on science and technology is evident in the high density of scientists and engineers within its population, which easily competes with that of any developed European country.
In its early years, Israel attempted to address its pressing security challenges by developing a national security strategy that emphasized qualitative parameters to neutralize the quantitative gaps vis-à-vis the surrounding enemy states. Soon after the establishment of the state, David Ben-Gurion — Israel’s first prime minister and minister of defense — articulated that due to Israel’s numerical inferiority, it must strive for qualitative superiority. Israel identified science and technology as critical for the accomplishment of this strategy.
Ben-Gurion further asserted that scientific research and technological development were essential not only for security needs, but also for the development of Israel in terms of agriculture, industry, and education. His plan was to enlist the best scientific minds of the Jewish people and to motivate young scientific talents to dedicate their lives to scientific research. They were to be provided with advanced equipment and well-equipped laboratories in fields such as physics and biology, with the expectation that they would align their research efforts towards the security and development of the country.
Given that “big science” involves long development cycles, high uncertainty, substantial risk, and a considerable chance of failure, engaging in extensive private-commercial science and technology projects without state intervention was exceptionally challenging, if not impossible, in the initial decades of Israel’s existence. The necessity for government funding stands out as a primary obstacle for smaller nations seeking to cultivate such capabilities. However, despite the challenges it faced and its status as a small state, Israel managed to overcome these barriers, successfully constructing and advancing a significant technological infrastructure. Israel attributes much of this success to making technological superiority a cornerstone of its national security strategy, which led in turn to the establishment of a well-developed and technologically advanced defense sector.
The end of the 20th century saw a dramatic change in the world’s technological landscape. State-owned technological innovation led primarily by the defense sector shifted towards innovation led by the entrepreneurs and investors of the private sector, establishing what we know today as the start-up age. Today, annual investment in commercial startups worldwide is significantly higher than investment in defense R&D. The private commercial sector dominates technological innovation and the defense sector often “feeds” on these innovations for its own applications, rather than the other way around.
Following this shift in technological dominance and leveraging its highly developed science and technology infrastructure, Israel has managed to position itself as a global source of technological innovation and business entrepreneurship, and is often referred to accordingly as the “Start-Up Nation.” Israel has many hi-tech companies listed on the NASDAQ, the second-largest stock exchange in the world after the New York Stock Exchange. Israel’s presence on the NASDAQ is second only to that of the United States and China. As of the end of 2022, there were over 130 Israeli companies listed on the NASDAQ, which is comparable to those of the British, French, and German companies on the exchange combined.
In the last decade, Israel’s investment in research and development has been the highest in the world relative to GDP by a significant margin. Additionally, Israel’s venture capital fundraising rate is among the highest globally on a per capita basis, and the success rate of its unicorn companies is particularly high. Between 1999 and 2014, approximately 10,000 start-up companies were established in Israel, with 2.6% achieving an annual profit of at least $100 million. In the Global Competitiveness Report for 2018-19, which ranked 141 countries, Israel was first in entrepreneurial culture and second in availability of venture capital. In 2021, investments in Israeli startups reached an unprecedented peak of $26 billion.
Given this context, it might seem reasonable to argue that aligning Israel’s highly developed technological ecosystem with its unique security context may have been relevant in its early decades, but has grown less so with time. This might appear on the surface to be true, as Israel’s economy seems to have extricated itself over the last few decades from the clutch of the defense sector and transformed the country into the “Start-Up Nation” it is today.
But the argument is inaccurate, as the connection between the Israeli hi-tech industry and the Israeli defense sector remains robust. To appreciate why, we need to delve into the Israeli technological ecosystem.
The ties to the defense system, particularly to the IDF, play a pivotal role for the Israeli hi-tech industry. In Israel, most citizens undergo mandatory military service, and after their discharge, many continue on active reserve duty. There is thus a continual interaction between the Israeli civilian and military domains.
This ongoing connection significantly empowers entrepreneurs serving in the IDF’s technological units to introduce novel technologies and devise solutions that can benefit the defense system. These entrepreneurs possess an in-depth personal understanding of that system and can identify its needs, weaknesses, and vulnerabilities. They utilize the training and extensive knowledge they acquired during their military service in the development process to great effect.
In the Israeli hi-tech sector, many of the start-up companies specializing in intelligence and cybersecurity are predominantly staffed by graduates of military technological units like Units 8200 and 81. These start-ups are involved in advancing defense-related technological projects, delivering training to defense entities, and providing prompt responses to the system’s operational needs. In many cases, the products offered by these companies are not generic but are meticulously tailored to meet specific operational requirements. Many projects undertaken by these companies are at the forefront of technological advancement.
To comprehend just how profound is the influence of this phenomenon on the Israeli hi-tech industry, we should examine the two units mentioned above, 8200 and 81. In the late 1990s, the IDF recognized the pivotal role of the cyber domain and took on the challenge of identifying and training suitable human resources. The IDF accordingly instituted unique advanced selection processes to recruit high-quality personnel. The innovative training program and courses transformed these young recruits into true experts in their fields.
Between 2003 and 2010, 100 or so officers and soldiers who completed their service in Unit 81 established around 50 start-up companies, collectively raising over $4 billion. Many of these companies continue to yield substantial revenues, and some have achieved successful exits. Unit 8200 was a major contributor to the emergence of many cybersecurity companies, including the legendary Check Point; Adallom, acquired by Microsoft for $320 million; and Armis, acquired by Accenture for $1.1 billion.
More than 1,000 start-ups have been founded by 8200 alumni. Its graduates are involved not only in cybersecurity start-ups but in many other fields as well, ranging from Waze to Wix to SolarEdge. These examples represent only a small fraction of the broader trend. It is no exaggeration to assert that graduates of these units have significantly shaped the Israeli hi-tech sector over the past decade. These units are a true powerhouse propelling the Israeli hi-tech sector, with a significant portion of the technology they develop flowing back to defense applications.
When analyzing the unique relationship between the IDF and the private commercial hi-tech sector in Israel, we can see that Israel’s unique security situation has created a mechanism through which both parties are so interwoven as to make it difficult at times to tell them apart. It is in Israel’s best interest to continue to nurture this unique relationship, which is beneficial for Israel’s prosperity as well as its security.
Nir Reuven is a researcher at the BESA Center, an engineer, and a former officer in the Merkava development program (the main Israeli battle tank). He has held management positions in the Israeli hi-tech industry and is an expert on technology. Currently he is co-manager of the Sapir College Innovation and Entrepreneurship Center. He is working on his Ph.D. and lectures at Bar-Ilan University. A version of this article was originally published by The BESA Center.
The post Is Israel the ‘Start-Up Nation’ Because of Its Security Situation? first appeared on Algemeiner.com.
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US Sens. Tom Cotton, Lindsey Graham Unveil New Resolution Demanding Iran ‘Dismantle’ Nuclear Program
US Sen. Tom Cotton (R-AK) speaks during a Senate Intelligence Committee hearing on Capitol Hill in Washington, DC, March 11, 2024. Photo: REUTERS/Julia Nikhinson
US Republican Sens. Tom Cotton (AK) and Lindsey Graham (SC) on Thursday unveiled a new resolution demanding Iran completely “dismantle” its nuclear program.
The resolution was introduced as the Trump administration continued to engage in talks with Iran to negotiate a deal to curb the latter’s nuclear activity, which Western countries believe is ultimately geared to build nuclear weapons. Iran has claimed its nuclear program is for civilian energy purposes.
“Iran cannot get a nuclear weapon; that’s off the table,” Graham said during a press conference on Thursday.
The resolution calls on the White House to pursue the “complete dismantlement” of Iran’s nuclear enrichment program, cautioning that Tehran would use a nuclear warhead to “carry out one of the most extreme religious ideas on the planet” — a reference to the Islamist ideology of Iran’s rulers.
The senators called on their colleagues in Congress to support the resolution.
Graham warned that if Iran, a predominately Shi’ite country under its current theocratic system, ever acquired a nuclear weapon, then the Sunni Arab countries of the Middle East would then attempt to obtain one themselves, sparking “a nuclear arms race in the Middle East.” Graham also cautioned that Iran would use a nuclear weapon as an “insurance policy” and a tool to destroy its enemies, including Israel. The senator demanded that Iran completely scrap its nuclear program, arguing that anything short of “complete dismantlement” would be “non-negotiable.”
“The ayatollah [Iran’s supreme leader, Ali Khamenei,] and his henchmen are virtual religious Nazis,” Graham said. “They openly talk about destroying the state of Israel. They write it on the side of their missiles, and I believe them.”
Graham claimed that Iran has likely enriched enough uranium to produce at least six nuclear weapons.
The South Carolina senator predicted that Iran would also use nuclear bombs to “take over” Muslim holy sites and push the United States out of the Middle East.
“A nuclear Iran makes for a far more dangerous world,” Cotton said.
Cotton argued that Iran would use the security provided by a nuclear weapon to aggressively advance its terrorism campaigns throughout the globe. The senator cited several terror attacks tied to Iran, including the assassination attempt against US President Donald Trump last year. Cotton also cited Iran’s continued operation of proxies such as Hezbollah, Hamas, and the Houthis — all internationally designated terrorist organizations backed by Tehran.
The Arkansas senator added that an Iranian nuclear weapon would present “an existential threat to our good friend Israel,” which Iran’s leaders regularly threaten to destroy.
Israel has been among the most vocal proponents of dismantling Iran’s nuclear program, with Israeli Prime Minister Benjamin Netanyahu arguing that the US should pursue a “Libyan option” to eliminate the possibility of Tehran acquiring a nuclear weapon by overseeing the destruction of Iran’s nuclear installations and the dismantling of equipment.
Both Graham and Cotton stated that they would be supportive of Iran obtaining a true civilian nuclear energy program. However, the senators argued that allowing Iran to enrich uranium or maintain centrifuges itself would inevitably lead to Tehran building a nuclear weapon.
As the US continues to negotiate a potential nuclear deal with Iran, the Trump administration has drawn criticism from some traditional allies who fear the White House could make too many concessions to Tehran. Critics have argued that elements of Trump’s negotiations with Iran mirror parts of the Joint Comprehensive Plan of Action (JCPOA) — the 2015 deal which placed temporary restrictions on ‘nuclear program in exchange for the lifting of major international sanctions.
The 2015 deal, which the Obama administration negotiated with Iran and other world powers, allowed Iran to enrich significant quantities of uranium to low levels of purity and stockpile them. It did not directly address the regime’s ballistic missile program but included an eight-year restriction on Iranian nuclear-capable ballistic missile activities. Trump withdrew the US from the accord during his first presidential term in 2018, arguing it was too weak and would undermine American interests.
The White House has also received scrutiny from other Republicans in Congress. In a comment posted on X/Twitter, Sen. Ted Cruz (R-TX), for example, lamented, “Anyone urging Trump to enter into another Obama Iran deal is giving the president terrible advice.” Urging the White House to reverse course, Cruz added that Trump “is entirely correct when he says Iran will NEVER be allowed to have nukes. His team should be 100% unified behind that.”
Trump has threatened military strikes, additional sanctions, and tariffs if an agreement is not reached to curb Iran’s nuclear activities. However, when asked by a reporter on Wednesday whether his administration would allow Iran to maintain an enrichment program as long as it doesn’t enrich uranium to weapons-grade levels, Trump said his team had not decided. “We haven’t made that decision yet,” Trump said in the White House. “We will, but we haven’t made that decision.”
Western countries believe Iran’s nuclear program is ultimately meant to build nuclear weapons. However, Iran has claimed that its program is for civilian energy purposes.
The International Atomic Energy Agency (IAEA), the UN’s nuclear watchdog, reported last year that Iran had greatly accelerated uranium enrichment to close to weapons grade at some of its nuclear facilities.
The UK, France, and Germany said in a statement at the time that there is no “credible civilian justification” for Iran’s recent nuclear activity, arguing it “gives Iran the capability to rapidly produce sufficient fissile material for multiple nuclear weapons.”
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Prevost Surprises as First US Pope, Takes Name Leo XIV
Newly elected Pope Leo XIV, Cardinal Robert Prevost of the United States appears on the balcony of St. Peter’s Basilica, at the Vatican, May 8, 2025. Photo: REUTERS/Guglielmo Mangiapane
Cardinal Robert Prevost, a long-time missionary in Latin America, was elected as the surprise choice to be the new leader of the Catholic Church on Thursday, becoming the first US pope and taking the name Leo XIV.
Pope Leo appeared on the central balcony of St. Peter’s Basilica after white smoke billowed from a chimney atop the Sistine Chapel, signifying the 133 cardinal electors had chosen him as a successor to Francis, who died last month.
“Peace be with you all,” he told the cheering crowd, speaking in fluent Italian. He also spoke in Spanish during his brief address but did not say anything in English.
Prevost, 69 and originally from Chicago, has spent most of his career as a missionary in Peru and has dual Peruvian nationality. He became a cardinal only in 2023. He has given few media interviews and is known to have a shy personality.
President Donald Trump swiftly congratulated him on becoming the first US pope. “What excitement, and what a Great Honor for our Country. I look forward to meeting Pope Leo XIV. It will be a very meaningful moment!”
However, the new pope has a history of criticizing Trump and Vice President JD Vance’s policies, according to posts on the X account of Robert Prevost.
Massimo Faggioli, an Italian academic who has followed the papacy closely, suggested the tenor of the Trump presidency might have influenced the cardinals to choose a pope from the US, who could directly rebut the president.
“The international upheaval of the rhetoric of the Trump presidency, paradoxically, made possible the impossible,” said Faggioli, a professor at Villanova University in the US.
“Trump has broken many taboos, the conclave now has done the same — in a very different key.”
PRAISE FROM PERU
The appointment was welcomed by the Peruvian president Dina Boluarte.
“His closeness to those most in need left an indelible mark on the hearts of Peru,” her office said in a post on X.
Prevost becomes the 267th Catholic pope following the death of Francis, who was the first from Latin America and who ruled for 12 years.
Francis had widely sought to open the staid institution up to the modern world, enacting a range of reforms and allowing debate on divisive issues such as women’s ordination and better inclusion of LGBT Catholics.
Leo thanked Francis in his speech and repeated his predecessor’s call for a Church that is engaged with the modern world and “is always looking for peace, charity and being close to people, especially those who are suffering.”
He had not been seen as a frontrunner and there was a brief moment of uncertainty when his name was announced to the packed St. Peter’s Square, before people started to clap and cheer.
Unlike Francis, who spurned much of the trappings of the papacy from the day he was elected in 2013, Prevost wore a traditional red papal garment over his white cassock as he first appeared as Leo XIV.
SNAP, a US-based advocacy group for victims of clerical sex abuse, expressed “grave concern” about his election, renewing accusations that Prevost failed to take action against suspected predatory priests in the past in Chicago and in Peru.
“You can end the abuse crisis — the only question is, will you?” it said in a statement addressed to the new pope.
In an interview with the Vatican News website in 2023, Prevost said the Church must be transparent and honest in dealing with abuse allegations.
CHICAGO CELEBRATES
A crowd of clergy and staff members at Chicago’s Catholic Theological Union erupted in a joyful cheer as Pope Leo walked out onto the Vatican balcony, some four decades after he graduated from the South Side school.
It was an “explosion of excitement and cheers that went up in the room … many of us were just simply incredulous and just couldn’t even find words to express our delight, our pride,” said Sister Barbara Reid, president of the theology school.
Pope Leo graduated from the school in 1982 with a master’s degree. Reid called Leo intellectually brilliant, saying he has an extraordinarily compassionate heart.
“It’s an unusual blend that makes him a leader who can think critically, but listens to the cries of the poorest, and always has in mind those who are most needy,” she said.
THE NAME LEO
The last pope to take the name Leo led the Church from 1878-1903. Leo XIII was known for his devoted focus to social justice issues, and is often credited with laying the foundation for modern Catholic social teaching.
Prevost has attracted interest from his peers because of his quiet style and support for Francis, especially his commitment to social justice issues.
Prevost served as a bishop in Chiclayo, in northwestern Peru, from 2015 to 2023.
Francis brought him to Rome that year to head the Vatican office in charge of choosing which priests should serve as Catholic bishops across the globe, meaning he has had a hand in selecting many of the world’s bishops.
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Israel Warns of ‘Severe Consequences’ for Houthis, Vows to Defend Itself After US Cuts Deal With Terror Group
Smoke rises in the sky following US-led airstrikes in Sanaa, Yemen, Feb. 25, 2024. Photo: REUTERS/Adel Al Khader
Israeli Defense Minister Israel Katz on Thursday warned that the Houthis would “suffer severe consequences” if the Yemeni terrorist group continued to attack Israel, emphasizing the Jewish state’s capability to defend itself following US President Donald Trump’s unexpected deal with the Iran-backed rebel militia.
“Israel must be capable of defending itself against any threat or enemy,” Katz wrote in a post on X. “This has been the case throughout many challenges in the past and will remain true in the future.”
“I also warn the Iranian leaders who finance, arm, and operate the Houthi terrorist organization: the balance of power has shifted, and the Axis of Evil has collapsed,” the top Israeli defense official added. “What we did to Hezbollah in Beirut, to Hamas in Gaza, to Assad in Damascus, and to the Houthis in Yemen, we will also do to you in Tehran.”
Katz continued, “We will not allow anyone to harm Israel; and those who do will suffer severe consequences.”
On Sunday, the Houthis, an internationally designated terrorist group, declared they would impose a “comprehensive” aerial blockade on Israel, targeting the country’s airports in retaliation for the Israeli military’s expanded operations in Gaza.
Claiming solidarity with Palestinians in the war-torn enclave, the Iran-backed group took responsibility for a missile strike near Israel’s Ben Gurion Airport, marking the latest in a series of attacks.
While Israel’s missile defense systems have intercepted most strikes from Yemen, Sunday’s missile was the first in a series launched since March to bypass the country’s defense capabilities, following a drone strike on Tel Aviv last year.
Alongside Hezbollah and Hamas, Houthi rebels are a key part of Iran’s so-called “Axis of Resistance” against Israel and the United States.
On Wednesday, Israeli Prime Minister Benjamin Netanyahu vowed to retaliate against the Yemeni terrorist group, reaffirming that the Jewish state will defend itself against any threat.
“Israel will defend itself by itself,” Netanyahu said in a video posted on social media. “If others join us — our American friends — all the better. If they don’t, we will still defend ourselves on our own.”
In response to the Houthis’ latest attack, Israeli forces launched major strikes on the Yemeni port of Hodeidah and the international airport in Yemen’s capital Sanaa, both facilities crucial to the Iran-backed terrorist group’s ability to operate.
The strikes came as Houthi officials revealed that their agreement with Washington to cease targeting US maritime activity in the Red Sea did not include any commitment to stop attacking Israel or ships linked to the Jewish state.
لقطات جديدة للغارات الجوية الإسرائيلية التي أصابت مطار صنعاء الدولي في اليمن. pic.twitter.com/DlzAqg5xES
— الأحداث العالمية (@NewsNow4USA) May 6, 2025
Since the Israel-Hamas war began in October 2023, the Houthis — whose slogan is “death to America, death to Israel, curse the Jews, and victory to Islam” — have targeted over 100 merchant vessels in the Red Sea with missiles and drones, causing a massive disruption of global trade.
During an Oval Office appearance on Tuesday, Trump announced that the US would halt airstrikes on the Yemeni terrorist group after it agreed to stop attacking American ships — an agreement that ended weeks of escalating tensions with the Iran-backed group and, according to US and Israeli officials, was made without prior notice to Jerusalem.
Since launching its current operation in Yemen, known as Operation Rough Rider, on March 15, the US military says it has struck over 1,000 targets, killing hundreds of Houthi fighters and numerous group leaders.
After Trump announced the deal with the Iran-backed terrorist group, Iranian Foreign Ministry spokesperson Esmaeil Baghaei praised “the end of the US aggression” on Yemen and thanked Oman for its efforts in mediating the ceasefire agreement.
The post Israel Warns of ‘Severe Consequences’ for Houthis, Vows to Defend Itself After US Cuts Deal With Terror Group first appeared on Algemeiner.com.
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