Ariel Nishli/

$1.3 billion acquisition of Waze, the Israeli-developed traffic crowdsourcing app that has
won the hearts of 50 million users in 193 countries, is perhaps now recognized more
for keeping the company in its Tel Aviv headquarters than for its nine zeroes, and
is being touted as a national victory for Israel.

Click photo to download. Caption: Uri Levine, co-founder and president of the company that developed the Israeli traffic crowdsourcing app Waze, speaks during The Second Jerusalem International Tourism Summit at the Jerusalem International Convention Center on May 28, 2013. Credit: Flash 90.

the pride that flowed from the agreement to keep Waze’s talent put (Netanyahu
himself called company heads to say “You’ve reach your destination!”) indicates
underlying concern
that big foreign buyouts could eventually erode Israel’s
brand as the “start-up nation,” a term coined in the 2011 book by Dan Senor and
Saul Singer.

has created a narrative as a quintessentially Israeli company (barring its October
2011 Chinese venture capital (VC) injection and partial ownership by four other
American investors), evolving as an outgrowth of Israeli society’s
desensitization to sharing information, propensity to speak their minds, and
aggressive drivers.

as Waze eventually folds into Google, the Israeli influences that organically shaped
it–or at least its origins as a “Silicon Wadi” start-up–may fade away from
collective memory. Will this harm the company, or more significantly, harm
Israel’s identity as the start-up nation? Not likely, says Grace Zimmerman,
senior lecturer at Brandeis University’s International Business School.

are hundreds of products whose origins are in Israel that people all over the
world use and enjoy without knowing that the technology originated in Israel,”
Zimmerman tells “The same is
true of products developed in other countries.”

cites innovation as the main deterrent against Israel’s brand erosion. “Israel
is easily in the top 10 places in the world for VC activity and investment,”
she says. “Clearly, the international VC community sees the value and
opportunity that Israeli ventures provide. The best way for Israel to maintain
its elite status as ‘startup nation’ is to continue to be an international hub
of innovation.”

look at other Israeli start-ups that struck American gold reveals their
founders have by and large moved on to start or grow new start-ups in Israel while
their former companies’ national identities have indeed faded from memory. To
see this trend, one need not look further than Google, which began courting
Israeli tech start-ups in the spring of 2010, when it acquired LabPixies–a
company that created Web gadgets–for $25 million. Just six months later, Google
paid $10 million for Herzliya-based startup Quiksee, which was developing a
user-friendly platform for uploading videos to Google Maps.

days after the Waze deal was announced, two of the original LabPixies founders,
minus Nir Tzemah, who remains at Google, founded Ubimo, a mobile marketing
company that analyzes complex data for precision advertising. Ubimo is based in
Tel Aviv and is in full start-up mode, seeking seed investment. LabPixies
itself is virtually nonexistent, as it largely serviced the near-obsolete
iGoogle gadgets. An announcement on Google’s blog declares that iGoogle and its
gadgets will officially be discontinued come Nov. 1, 2013.

for Quiksee’s founders, not one of them remained at Google. Though they never
teamed up for …read more


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