According to an article I just read in Newsweek’s November 23 issue, Israel has more tech companies listed on the NASDAQ than Europe, China, Japan, South Korea, and India combined as well as raising thirty times more venture capital per person than Europe and the US (not combined).

“How does it produce, for its size, the most cutting-edge technology startups in the world?”

Newsweek says its the military (Israel Defense Force aka IDF) and its counterintuitive approach to hierarchies — instead of relying on senior officials to take initiatives, the IDF keeps itself understaffed at senior levels, encouraging initiative at lower ranks.  ”Lower ranks” usually implies men 18-21 years old as service is mandatory.

Having several family members who have served in Israel’s armed forces, including a cousin who couldn’t even tell me the location of the underground building where she worked, and an uncle who was in one of Israel’s elite intelligence agency units, I can see why the kind of service and rigors the soldiers face would lead to innovative thinking and a maturity level unseen in your typical college aged student.

The article lists specific companies like Compugen (founded by three guys who met in the IDF), Given Imaging (inventors of the Pillcam, the camera that you swallow), amongst others, that adapted something they’d used/learned/developed in the military into something novel and profitable.

(Fun fact, Israel currently has 63 companies listed on the NASDAQ Stock Exchange.)

And oui, I know I’m about two weeks behind on my Newsweeks, give me a break, its finals!