Region: U.S. | International

From "Jump Start Nation" to "Start Up Nation"

Doron Stern


Doron Stern
Having returned to Israel in 1989 after three years in a large law firm in New York, I was fortunate to witness, and be a part of the coming about of the phenomena which has been commonly nicknamed "Start Up Nation."
 
The term was invented and conceived by Dan Sinor and Saul Singer, in their brilliant book bearing the same title. It has been translated into 20 languages, and its contribution to the face of Israel cannot be overestimated. A minister in Ireland, a convention organizer in Istanbul, a venture fund managers in Palo Alto and a lawyer in Italy have all shared with me their excitement after having read it, and suddenly witnessed a new perspective of this nation.
 
However, many of us walk around with a feeling that this is not really so. We are not that good. We know, deep in our hearts, that we managed to 'fool the world' for a while, and we will eventually return to our natural position as underachievers - don't we?  Actually, I don't!
 
Having lived through the change, I realize something dramatic has changed in us, as a business community. I can still remember what we were back in the nineties. I remember how improvised and skeptic we were when it came to business.  Like trying to start an old car, knowing it won't start. Asking for an investment was like asking your neighbor, with his brand new Ford, to jump start your old beat Beatle, filled with envious gratitude. Knowing he is doing you a favor, which won't go anywhere. I thought this mindset would never change. As an Israeli, I was not sure how my fellow Jews in America managed to be so different from us. I saw them conducting multi-million-dollar transactions from their New York offices, with skill and assurance I knew I will never possess.
 
I think they thought so too...
 
Israel was struggling with a huge steady national deficit and a bleak future. As a result of this every business opportunity was weighed with skepticism and cynicism which, if all questions and doubts were answered, would still culminate with the inevitable question: "Then why hasn't anyone else thought of it before you did?"
 
When I returned to Israel as a young lawyer in the nineties, I was taught not to give up on any point - unless forced to by the client, to always leave loose ends in a contract - in case the client will need to extract himself from it, and to prolong negotiations as much as I can because something will arise to reveal that this deal should never have taken place at all.
 
And then things started to change. People started to feel they can, and they should, do something new. They became optimistic and impatient. They wanted to close deals rather than negotiate forever. They wanted to give in on immaterial issues in order to secure a transaction.
 
A friend called me in 1995, and asked for a recommendation for a lawyer for a Start Up company he was launching. I recommended a firm I respect, and my friend hired them as his lawyers. A couple of months later, my friend returned, dissatisfied, and demanded with a sour face to know "Why not you?" I admitted I wasn't familiar with this field of practice. "Neither am I", said my friend. "We'll learn."
 
This friend's name was Orni Petruschka, the man who later led the largest sale ever of an Israeli Start-Up company – Chromatis Networks – for 4.8 Billion US Dollars. But this time it was his first start up - Scorpio Networks.
 
And we learned indeed. Faced with a completely new field of practice, within a couple of years we had to negotiate the first big product sale ($7 Million), the next round of financing ($4 Million) and the sale of the company ($90 Million) to a large US company. We worked hard, we were constantly open, we asked each other questions and researched what we did not know, we deliberated on what we did know, we listened, argued and above all – we were thinking a lot. And we were not afraid to admit we did not know. We were not afraid to ask.
 
A few years later we could clearly see the transformation both in us and around us. We were indeed transformed. New Start Ups kept being launched. New Exits kept coming. New Venture Capital Funds were raised. A new reality was present.
 
The unique qualities of our society were always its optimism, its openness and its equality. Around the Camp David process entrepreneurs and investors alike started to believe in the long term too. People allowed themselves to be optimistic, and yet they were not afraid to admit there are things they do not know. The fact that one is not deemed to know, permitted one to check whether people around him actually know what he does not – and advance. And above all, there was the ever deep sense that we are all equal. We can all do it. One envies the one who "did it" because "it could have been me" or, more openly "it should have been me."
 
The nature of Start Up Nation, like the nature of innovation itself, was based on three core elements which were present in our society but were never before present in our business mindset: Optimism, Risk Taking, and Equality. On a belief that one is not inferior then his counterpart, can dare to ask, and should take risks. He may succeed.
 
And when this arrived to our business mind-set we really changed and transformed. Today young entrepreneurs absorb this belief.   What started as a "Jump Start Nation" back then - actually became "Start Up Nation" today.

Adv. Doron Stern is a partner at Tulchinsky Stern Marciano Cohen Levitski & Co.


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