Arab Startups In Israel With The Same Big Dreams

Israel's bustling high-tech startup scene
Israel's bustling high-tech startup scene
Keren Tsuriel Harari

TEL AVIV — Frida Issa knew from the age of 11 that she’d one day work in the world of computers. But it was with her first job at a Tel Aviv startup that she first nurtured ambitions to do something on her own — and something built for the future.

“We’re not into building a startup, work for two years, sell it and that’s it,” Issa explains. “We want to do something with technology that will last, and that’s tougher.”

She is a 31-year-old Arab entrepreneur who hopes to succeed against all odds.

“There’s nowadays an awakening of young Arabs around technology,” she says. “In my community, they had always encouraged you to stick to something established. So entrepreneurship is a new thing.”

And indeed, an Arab high-tech professional, once an esoteric thing within a minority society that cherished steady employment, is now part of the mainstream, joining the wave of young Israeli Arabs, who like their peers around the world caught the techy bug and are now dreaming big.

Based in Spain, Issa and her husband are now building their second technology venture, having grown from just the two of them into 30 employees. In the past 18 months alone, they have generated more than two million euros in revenue.

They hope that Mally, their mall navigation app, could pave the way for work in more countries. “We’re already working with three malls in Spain, and we’re in contact with 15 more with an eye to signing contracts,” Issa says. “We’re still funding ourselves because investors in Israel want to see customers and profits before they invest.”

There is still no solid data on the numbers of Israeli Arabs in Israel’s high-tech sector, but all agree that an increasing number of Arab youth are studying science and technology, with an eye to prospects in the digital sector.

The prestigious Technion Institute of Technology prides itself on turning out 70% of the founders and executives in the Israeli high-tech industry, and 20% of the students in this Haifa-based university are Arabs.

According to data from the Israeli Central Bureau of Statistics (CBS), the number of Arab students who studied science and technology in universities spiked 260% between 1990 and 2012.

Karin Mayer Rubinstein, CEO of the Israel Advanced Technology Industries organization, believes the industry is poised for growth. “There are about 100 startups with an Arab entrepreneur or under Arab ownership, 1,500-1,700 Arab employees in the entire sector, and 100 million shekels (about $28.7 million) invested to this day in Arab companies, which is not bad,” she says. “Something is moving.”

A veteran in the high-tech business already at the age of 44, Hans Shakur believes there are more than 5,000 Arabs working in the sector. “The scene is evolving, and it’s quite exciting,” he says.

Good intentions

Shakur knows everyone within the Israeli high-tech scene, Arabs and Jews, and pretty much everyone I asked knows him too. He was born in Acre and returned two years ago, before his elder son was born and after 12 years of living in Tel Aviv’s upscale north.

In the Technion Institute for Science, Haifa — Photo: Beny Shlevich/GNUFDL

He currently owns Markitect, a company that works with mobile and Internet content, and develops apps. It now has five employees — three Arabs and two Jews. Shakur is simultaneously involved in two startups and consults for entrepreneurs.

A year ago he decided to bring to Nazareth what any other city in the world full of geeks has — MobileMonday. The 14 events he organized with colleagues last year have attracted hundreds of participants, Arabs and Jews alike, as well as guests from companies like Nokia, Waze, uTest, GetTaxi and Orange. “A number of startups emerged there. People found employees, employment or partners,” Shakur says.

In 2007, after a few years in Silicon Valley, Roni Floman returned to Israel and started consulting with startups and high-tech companies. She began developing the idea of writing a book about Arabs in the high-tech sector after meeting with Smadar Nehab, Tsofen’s executive director, and Jimmy Levy, who just established Galil Software.

The result, Good Intentions, is no standard business book. For three years Floman followed young entrepreneurs, veteran high-tech experts, and Arab businessmen, not to mention initiatives that encourage integrating Arab employees in the high-tech industry. She compliments some, and criticizes others.

The book includes success stories alongside others that end with a feeling of compromise and acceptance. Just like in life. And the business stories the book describes are intertwined with personal and family stories, including some politically loaded ones.

“To be an entrepreneur, one has to be a bit nutty, to cling to something with insane optimism,” she says. “You take nothing and make it into a startup.”

According to CBS data, an employee in a technology-related position has an annual average income of 249,000 shekels (about $71,000), 2.3 times more than the average, and 3.5 times more than the average of an Arab employee.

Arabic content

But beyond the individual benefits for Israel’s Arab citizens is the broader payoff for the nation’s economy. “Arabs are 20% of the population, and they contribute 8% to the GDP,” says Al Bawader's Jimmy Levy. “If they doubled their contribution, the Israeli economy would gain 40 billion shekels ($11.4 billion) a year more. That’s a lot of benefit for everyone.”

Still he concedes bluntly: “Being an Arab entrepreneur or professional in this country is really not easy.” Encouraging Arab high-tech requires more investment in education, in networking infrastructure. And most of all, Levy would like to see Israeli companies expanding to the country’s north. “The northern region has a huge pool of talent, Technion alumni, and it would be great if these companies employ these talents.”

Amir Hayek might be an example. The 29-year-old didn’t wait to complete his computer science studies at the University of Haifa before starting work in the high-tech industry, for a Tel Aviv-based mobile startup.

At the Startup Weekend in Haifa, he developed a file-scanning app with a friend, Alaa Shehebar. “We were the only two Arabs, and you feel your chances are slimmer because the Jews have more self confidence, which I didn’t have it at the time,” he recalls. “But we developed the app GetSlide there and won the second place.”

His dream now it to start a company that would combine the things he likes. “Maybe I will start a local gaming company that would develop games for our region and will combine a message and art.”

Hayek points to an interesting niche. Today there are 100 million Arabic-speaking Internet users, 20 million more than two years ago. But only 1% of the content online is in Arabic. This could be a major opportunity for Arab high-tech entrepreneurs since a lot of money goes into this niche.

“Many foreign funds that invest in Israel are looking for companies that produce content and websites in Arabic.”

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The Food Truck, A Sign That The White And Wealthy Are Moving In

In San Diego, California, a researcher tracked how in the city's low-income neighborhoods that have traditionally lacked dining options, when interesting eateries arrive the gentrification of white, affluent and college-educated people has begun.

Balboa Park Spring Fling Food Truck festival

San Diego Food Trucks via Facebook
Pascale Joassart-Marcelli

SAN DIEGO — Everybody, it seems, welcomes the arrival of new restaurants, cafés, food trucks and farmers markets.

What could be the downside of fresh veggies, homemade empanadas and a pop-up restaurant specializing in banh mis?

But when they appear in unexpected places – think inner-city areas populated by immigrants – they're often the first salvo in a broader effort to rebrand and remake the community. As a result, these neighborhoods can quickly become unaffordable and unrecognizable to longtime residents.

An appetite for gentrification

I live in San Diego, where I teach courses on urban and food geographies and conduct research on the relationship between food and ethnicity in urban contexts.

In recent years, I started to notice a pattern playing out in the city's low-income neighborhoods that have traditionally lacked food options. More ethnic restaurants, street vendors, community gardens and farmers markets were cropping up. These, in turn, spurred growing numbers of white, affluent and college-educated people to venture into areas they had long avoided.

This observation inspired me to write a book, titled The $16 Taco, about how food – including what's seen as "ethnic," "authentic" or "alternative" – often serves as a spearhead for gentrification.

Take City Heights, a large multi-ethnic San Diego neighborhood where successive waves of refugees from places as far away as Vietnam and Somalia have resettled. In 2016, a dusty vacant lot on the busiest boulevard was converted into an outdoor international marketplace called Fair@44. There, food vendors gather in semi-permanent stalls to sell pupusas, lechon (roasted pig), single-sourced cold-brewed coffee, cupcakes and tamarind raspado (crushed ice) to neighborhood residents, along with tourists and visitors from other parts of the city.

Informal street vendors are casualties.

A public-private partnership called the City Heights Community Development Corporation, together with several nonprofits, launched the initiative to increase "access to healthy and culturally appropriate food" and serve as "a business incubator for local micro-entrepreneurs," including immigrants and refugees who live in the neighborhood.

On paper, this all sounds great.

But just a few blocks outside the gates, informal street vendors – who have long sold goods such as fruit, tamales and ice cream to residents who can't easily access supermarkets – now face heightened harassment. They've become causalities in a citywide crackdown on sidewalk vending spurred by complaints from business owners and residents in more affluent areas.

This isn't just happening in San Diego. The same tensions have been playing out in rapidly gentrifying areas like Los Angeles' Boyle Heights neighborhood, Chicago's Pilsen neighborhood, New York's Queens borough and East Austin, Texas.

In all of these places, because "ethnic," "authentic" and "exotic" foods are seen as cultural assets, they've become magnets for development.

Food vendor at outdoor international marketplace called Fair@44.

Fairat44 via Instagram

A call for food justice

Cities and neighborhoods have long sought to attract educated and affluent residents – people whom sociologist Richard Florida dubbed "the creative class." The thinking goes that these newcomers will spend their dollars and presumably contribute to economic growth and job creation.

Food, it seems, has become the perfect lure.

It's uncontroversial and has broad appeal. It taps into the American Dream and appeals to the multicultural values of many educated, wealthy foodies. Small food businesses, with their relatively low cost of entry, have been a cornerstone of ethnic entrepreneurship in American cities. And initiatives like farmers markets and street fairs don't require much in the way of public investment; instead, they rely on entrepreneurs and community-based organizations to do the heavy lifting.

In City Heights, the Community Development Corporation hosted its first annual City Heights Street Food Festival in 2019 to "get people together around table and food stalls to celebrate another year of community building." Other recent events have included African Restaurant Week, Dia de Los Muertos, New Year Lunar Festival, Soul Food Fest and Brazilian Carnival, all of which rely on food and drink to attract visitors and support local businesses.

Meanwhile, initiatives such as the New Roots Community Farm and the City Heights Farmers' Market have been launched by nonprofits with philanthropic support in the name of "food justice," with the goal of reducing racial disparities in access to healthy food and empowering residents – projects that are particularly appealing to highly educated people who value diversity and democracy.

Upending an existing foodscape

In media coverage of changing foodscapes in low-income neighborhoods like City Heights, you'll rarely find any complaints.

San Diego Magazine's neighborhood guide for City Heights, for example, emphasizes its "claim to authentic international eats, along with live music venues, craft beer, coffee, and outdoor fun." It recommends several ethnic restaurants and warns readers not to be fooled by appearances.

Longtime residents find themselves forced to compete against the "urban food machine"

But that doesn't mean objections don't exist.

Many longtime residents and small-business owners – mostly people of color and immigrants – have, for decades, lived, worked and struggled to feed their families in these neighborhoods. To do so, they've run convenience stores, opened ethnic restaurants, sold food in parks and alleys and created spaces to grow their own food.

All represent strategies to meet community needs in a place mostly ignored by mainstream retailers.

So what happens when new competitors come to town?

Food vendor at outdoor international marketplace called Fair@44.

Fairat44 via Instagram

Starting at a disadvantage

As I document in my book, these ethnic food businesses, because of a lack of financial and technical support, often struggle to compete with new enterprises that feature fresh façades, celebrity chefs, flashy marketing, bogus claims of authenticity and disproportionate media attention. Furthermore, following the arrival of more-affluent residents, existing ones find it increasingly difficult to stay.

My analysis of real estate ads for properties listed in City Heights and other gentrifying San Diego neighborhoods found that access to restaurants, cafés, farmers markets and outdoor dining is a common selling point. The listings I studied from 2019 often enticed potential buyers with lines like "shop at the local farmers' market," "join food truck festivals" and "participate in community food drives!"

San Diego Magazine's home buyer guide for the same year identified City Heights as an "up-and-coming neighborhood," attributing its appeal to its diverse population and eclectic "culinary landscape," including several restaurants and Fair@44.

When I see that City Heights' home prices rose 58% over the past three years, I'm not surprised.

Going up against the urban food machine

Longtime residents find themselves forced to compete against what I call the "urban food machine," a play on sociologist Harvey Molotch's "urban growth machine" – a term he coined more than 50 years ago to explain how cities were being shaped by a loose coalition of powerful elites who sought to profit off urban growth.

I argue that investors and developers use food as a tool for achieving the same ends.

When their work is done, what's left is a rather insipid and tasteless neighborhood, where foodscapes become more of a marketable mishmash of cultures than an ethnic enclave that's evolved organically to meet the needs of residents. The distinctions of time and place start to blur: An "ethnic food district" in San Diego looks no different than one in Chicago or Austin.

Meanwhile, the routines and rhythms of everyday life have changed so much that longtime residents no longer feel like they belong. Their stories and culture reduced to a selling point, they're forced to either recede to the shadows or leave altogether.

It's hard to see how that's a form of inclusion or empowerment.The Conversation


Pascale Joassart-Marcelli is a Professor of Geography and Director, Urban Studies and Food Studies Programs at San Diego State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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