Last night, the 12 year reign of Binyamin Netanyahu came to an end and Israel got a new Prime Minister, Naftali Bennett.
Source: Jerusalem Post
Bennett is the first of a new generation of Israel political leaders that comes from the High Tech sector, where he was a very successful entrepreneur and investor.
He founded and led two successful high tech startups to $100+ million exits:
- Cyota, a company in the field now known as cybersecurity for $145M in 2005
- Soluto, a technology support solutions company for $130M in 2009
Startup Nation gets a Startup PM
Israel prides itself as being the Startup Nation and high tech represents a large percentage of GDP and a source of strong economic growth.
In Israel, rather than planning to be a doctor, lawyer or sports star, young people aspire to start their own high-tech company. And a great many people do, despite the very real risks of failure. Tech entrepreneurship is now a core part of Israeli culture.
Israel's tech sector and the amount of investment it raises each year dwarfs every country other than the US. Indeed, it is larger than the whole of the EU combined.
While a $100M+ tech exit would be huge news in any country other than Israel and the US, such exits are so common that even a $6.8 billion exit (via IPO) last week by the Israeli tech company, Monday, is barely news a few days later (I had to go looking deep into the Globes website to find it).
Indeed Israel's High Tech sector is so strong at the moment that it has smashed the previous (2020) record of amounts raised in less than 6 months of 2021.
So it is highly appropriate and representative of the nation that the Prime Minister is a high tech entrepreneur.
... and a Startup Opposition Leader
This changing of the guard is likely to place another highly successful high tech entrepreneur, Nir Barkat, as leader of the (now) opposition Likud party. Barkat has by far the highest support (32%) of any current Likud figure to take over from Netanyahu.
Nir Barkat founded the software company BRM in 1988. It developed anti-virus software which was sold to Symantec in 1993.
The funds were used to invest in many highly successful Israeli high tech companies including Checkpoint, Fraud Sciences and Moovit.
Thus Nir Barkat was one of the early leaders of the transformation of Israel from a struggling second world economy to a high tech super power.
Barkat served as mayor of Jerusalem from 2008 to 2018. I worked on his mayoral campaign in 2008.
Implications for Cryptocurrency
I predict that these political developments will have significant impact on Israel's treatment of cryptocurrency.
To date there has been a dichotomy between support of high tech companies in the technology of the crypto space but unfavourable treatment from banks and the tax office that have made it difficult for businesses supporting actual cryptocurrency usage.
With El Salvador now recognising BTC as legal tender, this may begin to shift things, especially as Nir Barkat knows President Bukele well, both having been mayors of their respective capital cities prior to their ascent to the national scene.
This video shows them together in 2019, just after Bukele had won the El Salvadoran Presidental election in a landslide.
A new culture of de-regulation and respect for entrepreneurship from government?
While some question the stability of this new Bennett led government, the big picture is that there has been a major generational and cultural transition in Israeli politics and leaders who have been high-tech entrepreneurs are rising to the fore.
While Bibi certainly supported the high tech sector and engaged in pro-market economic reform (in his earlier years), he was a product, like those before him, of decades of government service.
Political leaders who have never taken entrepreneurial risk themselves or understood the devastating consequences of over-regulation and who have lived their whole life sucking on the teat of taxpayer funding are far too common in the world.
Hopefully these changes at the top of Israel politics will advance free-market, libertarian principles across the Israel economy rather than the crony capitalism that is so prevalent.
Please vote for my Hive witness. (KeyChain or HiveSigner)