Six Kids and a Full Time Job

Tom Friedman: Foolish Consistency Is the Hobgoblin of Little Minds

2011-12-09T13:44:00.003+02:00

I think Emerson's above comment must refer to the NY Times Tom Friedman. I have said it once, twice, thrice and I will say it again: Tom Friedman is a pompous pontificating pundit who is simply always wrong. compare these 2 Tom gems:

"And, as we sit here today, the popular trend is not with the Muslim Brotherhood. Indeed, what makes the uprising here [in Egypt] so impressive--and in that sense so dangerous to other autocracies in the region--is precisely the fact that it is not owned by, and was not inspired by, the Muslim Brotherhood."--Thomas Friedman, New York Times website, Feb. 13

"The fact that the Muslim Brotherhood and the even more fundamentalist Salafist Nour Party have garnered some 65 percent of the votes in the first round of Egypt's free parliamentary elections since the ouster of President Hosni Mubarak should hardly come as a surprise. Given the way that the military regimes in the Arab world decimated all independent secular political parties over the last 50 years, there is little chance of any Arab country going from Mubarak to Jefferson without going through some Khomeini."--Friedman, New York Times, Dec. 7

(Hat Tip: Morton L.)

מניפסט החומוס פרק 2א! הגיע הזמן שהמדען הראשי יחשוב בצורה חדשה וחדשנית

2011-11-22T08:05:00.001+02:00

המאמר הקצר יותר התפרסם הבוקר בדה מרקר

ידידי הטוב יזהר שי מזהיר אותנו מהידרדרות ביתרון התחרותי שלנו בתעשיית ההיי טק. סליחה יזהר: איחרת. אנחנו כבר שם. יזהר, כמו המדען הראשי אבי חסון, קושרים את ההידרדרות לצמצום, קיטון או מחסור בתקציב המדען הראשי. שטויות. אין שום טעם להעביר עוד כספים למדען כל עוד המדען לא מתחיל לחשוב אחרת. היתרון התחרותי שלנו הידרדר בעשור האחרון בגלל חוסר המיקוד וחוסר אסטרטגיה של המדען. איזה תשתית תעשייתית או אנושית הקים המדען? מה היעדים וטווח ההשקעה שלו? האם מישהו יודע? זה לא בגלל האוצר. ולא בגלל קיטון יחסי. פשוט למדען הראשי אין אסטרטגיית השקעה והוא מפוזר על כל המפה הטכנולוגית.

במאמרו האחרון כותב יזהר:

המדען התריע על מחסור חמור בתקציב המו"פ ודרש תוספת מיידית, במטרה לאפשר את מימונן של למעלה מ – 500 בקשות תמיכה מחברות טכנולוגיה, שנותרו לפי שעה ללא מענה. הגירעון, עליו התריע המדען, הוא בסדר גודל של כ 450 מליון ש"ח.

אני משקיע, פחות או יותר, בשתי חברות בשנה. ואני עובד יחסית קשה. המדען הראשי ב1300 חברות. זה מעל 3 השקעות ביום כולל שבתות, חגים ימי שישי ושעות מנוחה. ועכשיו רוצים כסף לעוד 500 השנה. לאיזה מטרה? איזה יתרון תחרותי תיווצר למדינת ישראל וכלכלת ישראל מפיזור ל1300 חברות בכל מיני תחומים?

מי רוצה לממן עוד 500 מיזמים, המפזרות ומדללות את שורות המתכנתים ומהנדסים במדינה בלי מטרה ברורה ובלי אסטרטגיה? הגודל והכמות אינה מטרה כשל עצמה. ממנים 2 מכל 3 פרויקטים המוגשים? זה אסטרטגיה? שנים, אנחנו מבזבזים ומפזרים כספים על חמממות שמבזרות ומדללות את כוחות הטכנולוגיים בשוק והם לא יוצרות אף תעשייה ואף חברה גדולה. יצירת תעשייה או תחומי פעילות חדשניים צריכים להיות המטרה ולא מימון 500 חברות בכל מיני תחומים ובלי אסטרטגיה.

אבל המערכת אינה מסוגלת היום לחשוב אחרת ולהצליח: כפי שכתבתי במניפסט החומוס פרק ב

כאשר פקידים ממשלתיים, המנותקים מהשוק כבר שנים רבות, מתבקשים להשקיע את כספי המסים בטכנולוגיה, החזון שלהם -ומכאן, גם החלטותיהם - מוגבלים מאוד. תוצאה זו היא טבעית. הם זקוקים להתוויית כיוון אסטרטגית מסיבית מלמעלה או מבחוץ, כדי שיוכלו לקבל החלטות נכונות ולא רק להגיב להצעות באופן דמוקרטי. פקידים אלה בחרו באפשרות השנייה. חלוקה דמוקרטית של כספי ההשקעות אינה יוצרת תעשיות חדשות וגם לא משנה את המסלול של התחרותיות הטכנולוגית הלאומית של מדינת ישראל - היא פשוט מפזרת את הכסף באופן בלתי אפקטיבי. זה מה שמשרד המדען הראשי עושה כבר 15 שנה.

התוצאה היא ערימה של חברות טכנולוגיה שאינן מקבלות הון סיכון אבל כן מקבלות מהמדען הראשי מימון בהיקף שאינו מספיק כדי לחולל שינוי. במילים אחרות, השוק דחה את הטכנולוגיות הללו אבל הממשלה, משום מה, החליטה להעניק להן את כספי משלמי המסים, בסכומים לא מספיקים ובתנאים שיקשו על קיומן. זוהי גישה נחשלת שאינה משפרת את היתרון הטכנולוגי התחרותי שלנו כמדינה

התמונה כוללת גם את השקעות המדען בחברות גדולות. באופן מיסתורי, אפל שנאבקה על חייה בשנת 2000 המציאה את האיפוד, אפל TV האייפד, והאייפון וגוגל את האנדרויד וגוגל אפס ועוד בלי דולר מהמדען הראשי האמריקאי אבל אי סי איי טלקום אינה מסוגלת לפתח את מוצרי הדור הבא ללא סיוע מהמדען הראשי הישראלי.

חוץ מלצעוק שאין לו מספיק כסף, האם הציג המדען הראשי תוכנית ואסטרטגיית השקעה ליצירת יתרון תחרותי לעתיד המדינה? לפני שיבזבזו עוד מכספי המיסים שלי: אני הייתי רוצה לדעת מה התוכנית. העולם והטכנולוגיה מתקדמות בקצב מסחרר ואם לא נתווה אסטרטגיה וניקח סיכונים ממוקדים בהשקעותה של המדינה לא נדביק את קצב השינוי של העולם הטכנולוגי. המדען משתמש באותם כלים מימוניים כבר למעלה מ20 שנה ובינתיים העולם, כפי שכותב יזהר, הדביק אותנו. אולי אפשר לחשוב על כלים אחרים?

כפי שכתבתי במניפסט החומוס פרק ג באריכות ובפירוט, אנו זקוקים לרעיונות חדשים ואסטרטגיה חדשה בתחום המו"פ כדי להחזיר לעצמינו את היתרון התחרותי שלנו. אנו זקוקים לסינכרון גופים ממששלתיים (כמו מפע"ת ובט"ט) בהשקעות מו"פ. בנוסף, המדען הראשי חייב להתמקד ולמקד משאבים במעט תחומים כדי לייצר בהם יתרון תחרותי. המדען הראשי צריך להמר ולא לחלק סוכריות קטנות לכווווולם. כן, גם במחיר של לקיחת חמצן מחלק מהנתמכים הסדרתיים והחדשים של המדען. תפקידו של המדען אינו כמו משקיע בורסאי שבונה פורטפוליו רחב לטווח השקעה של ימים עד שנתיים. ולא כמו קרן פרייויט אקוויטי שמשקיע רק בחברות גדולות לטווח של 2-5 שנים. והוא גם לא משקיע הון סיכון שמשקיע ב15-20 חברות לטווח של 7-10 שנים. המדען חייב להקים, לממן ולפתח תשתית טכנולוגית, מחקרית, הונית ואנושית לקידום יתרון התחרותי של המדינה. וזה לטווח של עשור עד עשורים. וזה מחייב חשיבה מחודשת וחדשנית.

הריטואל הקבוע של ההתכתשות השנתי בין המדען לאוצר כבר משעממת. אין בה בשורה. הבכיינות על חוסר תקציב לא עוזר ליזמים מול משקיעיהן וגם לא למדען מול משלם המיסים וגם לא ליתרון התחרותי של מדינת ישראל. אני בעד השקעה הרבה יותר מאסיבת במו"פ וגם בהשקעה בהסבה מקצועית לכל מי שרוצה לעבור לתחומי העתיד. מגיע לאזרחים וגם למדינה. אבל, אם המדען הראשי אינו מסוגל לחדש את שיטות עבודת משרדו ולחשוב בעצמו מחוץ לקופסא אז חבל על הכסף כי לא נשפר את יתרונינו התחרותי. ידידי אבי חסון, באת לתפקיד מרקע של משקיע ועם הרבה התלהבות. אולי תנסה גישה חדשה?

Hey Sean Parker: We Are Only 7 Million People and Little Start Ups Are Draining Talent in Israel Too!

2011-11-16T10:27:00.001+02:00

Sean Parker nailed it yesterday:

"Sean Parker warns about the downside of the explosion of seed-stage startups.”Little startups are ridiculously overfunded,” he say. “The market is ridiculously overcrowded with early stage investors. This results in a talent drain, where the best talent gets diffused and work for their own startups.”
The problem in his view is that many of the talented engineers and product designers who are now starting their own companies could have a bigger impact at places like Facebook, and they in turn will have a hard time attracting the best talent because those people can get funded to start their own projects as well."

As I wrote in the Humus Manifesto part 1, this problem exists in Israel too.

"We have a dearth of talent
Huh? A dearth of talent? How could that be? Well, we have tons of smart people and tons of entrepreneurs. We have lots of engineers. However, many are misplaced, scattered and focused on the wrong technologies. Here is why:
Firstly, there are too many start ups in Israel. We are a small country whose plethora of large angels, individual investors and even VCs have seeded a ton of companies. In Israel, the two man start up is not a path to building the next Facebook but, rather it has become a path to a 5 person company who will try to sell its feature quickly. This is scattering our talent and preventing our more successful and growing startups from finding and hiring the talent they need in order to scale up to be big companies. The two man feature-startup creates unrealistic equity expectations, as these founders own 80% of their little companies (their angel owns 20% for a few hundred thousand bucks) and the founder asks himself "why would I go work at company X for 0.2% of equity when I own 80% of my own company"). This is a problem. Israel's great startup companies cannot find great talent to recruit in ways that Google and Facebook have recruited in Silicon Valley because too many great engineers are scattered in tiny start ups. Based on conversations I have had, Venture Capitalists in Silicon Valley have taken note of this."

However, the 2 person start up is not only draining talent from the system and impeding the growth of impact companies like Facebook in Silicon Valley, and Conduit or Wix in Israel, it is driving up the cost of great engineering talent to frightening levels. In Israel, where the supply of internet scale engineering talent is even more scarce than Silicon Valley, this is a worrisome trend. An entrepreneur recently remarked to me that "Google, Conduit and Wix are eating up all the talent in the [Israeli] market and it is really hard to recruit." Right.

There are no quick fixes to this problem but there are some helpful steps to be taken:

1. If your start up is not scaling, give it up, return the money to your angels and go to a growing company to get experience. In 2 years come back and do another start up.

2. Angels and VCs can close the companies that are not scaling and recycle the great talent into the system. Our economy needs it. We seem to be better at recycling politicians than recycling great engineers and that is a pity.

3. Companies like Google, Conduit and Wix can buy 2-4 person start ups for the talent like Facebook and Google have.

4. We can stop subsidizing University education for our bright students to become lawyers and instead provide significant incentives for them to become engineers. While at it, lets expand the computer science, robotics, nanotech and other science departments at our universities.

This won't be solved tomorrow but if we do not start addressing it now, we will have an even bigger problem on our hands.

ככה אי אפשר לנהל מדינה

2011-11-08T13:53:00.003+02:00

הכותרות נשבוע שעבר צעקו על גידול במשרות האימון בלשכת ראש הממשלה. אינני יודע אם כל האנשים האלה הכרחיים לניהול המדינה כמו שאני לא בטוח שצריך את כל הפקידים במשרדי הממשלה השונים שעברו מכרזים ומיונים ואינם משרתים כראוי את אזרחי המדינה. המערכת הממשלתית מליאה בשומן ומתאפיינית בחוסר יעילות ושום מכרז או תנאי סף לא מונע את זה. לא במשרד הפנים. לא במינהל מקרקעי ישראל וגם לא במשרד ראש הממשלה. ובכל זאת האנשים נשארים.

כשקראתי את המאמרים המאד ארוכים שתומכים בדו"ח המבקר שאלתי את עצמי: האם המבקר או איזשהו ועדה תוכל לבחור אנשים יותר טובים? האם "אובייקטיביות" לכאורה הוא שיטה יותר טובה? כמובן שלא. כל התהליכים והועדות האלה משיגות רק דבר אחד: הרתעת אנשים מוכשרים להיכנס לשירות הציבורי. בנוסף, המשרות האלה מצריכות עבודת צוות אינטנסיבית וכן אימון אישי. דווקא בגלל זה כדאי שכמה שיותר משרות יהיו על בסיס אימון ולא על בסיס ועדה שאינה יכולה לבחון כימיה אישית אלא קריטריונים יבשים. איזה מנכ"ל של חברה היה נותן לועדה חיצונית לבחור את צוותו המוביל? האם מישהו חושב לרגע שגוגל, אמריקן אקספרס או מיקרוסופט היו מצליחים עם בניית צוות ניהולי בדרך זו?

אזרחי המדינה חייבים את המוחות והכשרונות הכי טובים במשרות הרגישות והחשובות. ועדות וקריטריונים שרירותיים ומאובנים רק מרתיעים. בוא ניקח דוגמא ואני מצטט את הכתבה בנושא מדה מרקר :

המבקר גילה גם כי ארבעה מיועצי ראש הממשלה נתניהו לא עמדו בתנאי הסף למשרה, המחייבים תואר אקדמי. מנהל הלשכה, גיל שפר, שמונה לתפקיד בדצמבר 2010, לא עמד בתנאי הסף המחייבים שבעל המשרה יהיה בעל תואר אקדמי. בתשובתו למשרד מבקר המדינה מיולי 2011, ציין שפר כי התבקש על ידי ראש הממשלה למלא את התפקיד בזכות ניסיונו המקצועי הנצבר לאורך השנים בסקטור הפרטי ויותר מעשור בסקטור הציבורי בתפקידי ניהול בכיר.

משרד ראש הממשלה השיב בעניין זה כי העובד הוא "בכיר ומנוסה, בעל ניסיון מקצועי עשיר וניסיון רלוונטי ורב לתפקידו". אך שפר אינו היחיד: יועץ ראש הממשלה להתיישבות, גבי קדוש, שכיהן בעבר כראש העיר אילת, הוא אמנם בעל ניסיון ביצועי ממשי, אך אינו בעל תואר אקדמי - ועל כן אינו עומד בדרישת הסף, ובהן תואר ראשון במדעי החברה.

יועץ ראש הממשלה לפניות הציבור גם הוא אמנם בעל ניסיון ניהולי עשיר, אבל אינו בעל תואר אקדמי. למעשה, הוא לא עמד בתנאי סף המשרה. מנהל מחוז הצפון במשרד ראש הממשלה, ישראל יעקב, לא עמד אף הוא בתנאי הסף בעניין השכלה, שחייבו תואר ראשון.

אינני יודע אם שפר או ישראל יעקב מתאימים לתפקיד. אני כן יודע שבתנאים אלו לא סטיב גובס ולא מארק צוקרברג היו מתקבלים לעבודה בלשכת רוה"מ כי להם אין תואר אקדמי! אבסורד? חלק גדול מבוגרי שמונה מאתיים לא סיימו תואר אקדמי אבל ללא ספק יש להם כישרונות מתאימים לתפקידים רמי דרג. דרישת תואר אקדמי היא רק דוגמא אחת מני רבות של חשיבה מאובנת שמקורה באליטיזם ומשפטיזציה של מערכת המשילות בישראל. וככה אי אפשר לנהל מדינה. אני לא בחרתי במיכה לינדנשראוס לנהל את המדינה ולא בפרופסורים שיושבים בועדות לבחון את הדברים. אזרחי המדינה בחרו בראש הממשלה לנהל את המדינה וצריך לתת לו לעשות את זה. אם הוא ימעל באימון הציבור וימנה אנשים לא ראויים אז נזרוק אותו בבחירות הבאות. עד אז, תן לו לנהל את המדינה. זה גם ככה התפקיד הכי מורכב בעולם.

Corbin Hill Farm & Farmigo: Doing Well While Doing Good

2011-11-05T21:20:00.004+02:00

My good friend Benzi Ronen, CEO of Farmigo, sent me this incredible chart from Corbin Hill Road Farm. Corbin Hill Farm delivers food/produce directly from its Farm in Schoharie, NY to Harlem NY, targeting low income neighborhoods. Corbin Hill is using Farmigo and a CSA model to deliver this healthy and fresh food at prices LOWER than the local Harlem supermarkets. Let me say that again, you can get fresher and healthier food direct from a farm at lower prices than a supermarket.

This is what my friend Umair Haque calls Eudaimonic innovation. It is what happens when you reimagine a system from the start, take out the useless middlemen and apply the network power of the internet to break apart the now sclerotic food system. It is what happens when innovative people with a heart and a glimmer in their eye, use capitalism to make money and do good at the same time.

As America starts to debate farm subsidies and big ag, while college grads are starting more small farms than any time in the last 100 years, look to the power of technology to break open an unhealthy and highly inefficient food distribution system that has left the world both obese and stuck with higher food prices. Go Farmigo and Corbin Hill! These are businesses that should be supported so sign up here : corbinhillfarm.com/winterseason.html

Worth Reading: the Mission Statement of Corbin Hill Farm:

Mission
Corbin Hill Road Farm (CHRF) supplies fresh produce where it is needed most. In doing so, CHRF re-imagines the relationship between consumers, farmers, and investors; strengthens the linkages between rural and urban communities; and fosters economic citizenship and opportunity in the communities where we operate.

What We Do
We are a produce distributor who specializes in the needs of low-income communities living in "food deserts." We distribute produce through our Farm Share (an adapted CSA) and ourwholesale operations.

Our Model
The core of CHRF's model is the formation of strategic partnership clusters. Our role is to connect these clusters (some existing, some new) in order to create an effective system for the production, distribution, and consumption of healthy and sustainable food.

CHRF operates simultaneously from two locations: our farm in Schoharie County, NY and an office in Harlem. We do not grow the produce for our operations on our farm; instead, we aggregate produce from our growing network of upstate farmers. This strategy has many benefits, including: protecting our Shareholders (Farm Share members) from the risks associated with only aligning with one farm; ensure that the number of Shareholders participating in the Farm Share is not restricted by a single supply of produce; and open up new markets and economic opportunities for upstate farmers. Click here for a diagram of our operational model.

Hummus Manifesto Part 4 - It's Amazon Stupid!

2011-10-04T22:48:00.006+02:00

In Hummus Manifesto part 3 I suggested the following:

"Let us declare Israel the cloud computing center for this region of the world. We can lure Amazon and Google to build massive cloud data centers here with matching money and tax incentives. Maybe it is not too late to get Google to wire the entire country with broadband. The debate over whether to give Intel a $100MM grant or $400MM grant is an argument over one company and one city that has some tentacles into that city. The same $400M grant, matched by Google and/or Amazon would be the equivalent of building a railroad across our country. It is infrastructure that fundamentally increases our national competitiveness."

In an interview last week, my colleague Aaron Makovski of Pitango and the Israel High Tech Association excoriated the government for hesitating on giving a $1 billion grant to Intel to expand their fab. I pondered this for a week, watched Jeff Bezos launch the Fire Tablet and then the nickel dropped. The most important thing Israel can do now in terms of both technological innovation leadership, to increase employment and to address the cost of cottage cheese in Israel is to bring Amazon and Jeff Bezos here. Here is why:

Amazon is in the business of delivering goods and services inexpensively and efficiently. When pundits questioned how and why they moved from selling books to selling an IT cloud, the answer was not obvious but now it is. Amazon excels at being the most price competitive provider of goods and services. It is true in books, IT, cloud, $199 tablet computers, on-demand movies and cottage cheese.

The Israeli government, as I pointed out in part 2 of the Hummus Manifesto forgot the playbook of bringing leading companies to Israel and instead stayed stuck in the 80s and 90s with Intel, Microsoft and Motorola. We need a renewed focus on bringing leading edge companies here and Amazon should be the first. Intel is under threat from ARM processors in the era of tablet computing and a Billion dollars does not leapfrog us forward technologically as a country. Amazon, on the other hand, is disrupting everyone from book publishers to Apple to Walmart from the bottom. Yes...Walmart.

Bringing Amazon to Israel would immediately make us a player in cloud computing. We should subsidize the establishment of an AWS (Amazon Web Services) bleeding edge cloud facility here. We should push to get tablet software development here and same for media delivery services that Amazon excels in. Our Israeli ingenuity will help them excel at providing all this for a low cost and we can train our engineers on their bleeding edge platforms. And there is an added benefit. Amazon is also in the low cost food delivery business. Imagine them undercutting the supermarket chains in Israel like they do in the USA with a web storefront and low cost delivery. These are the waves of the future: Tablet computing, cloud computing, wireless media services and great products and Amazon is in all of them. And we can lower the price of cottage cheese at the same time.

Nachas and Generational Continuity

2011-08-31T05:52:00.004+03:00

We just returned from an extended-family trip to the Czech Republic and it's capital, Prague. Prague is unique in Europe from a Jewish perspective as it is perhaps the only place that Hitler and the Nazis did not pillage and destroy. The Nazis, unfortunately and tragically did wipe out 80+% of the Jews of Prague.

On shabbat we davened (prayed) at the oldest extant synagogue in continuous use in the world, The Old-New Shul otherwise known as the Alt-Noy Shul. The Alt-Noy Shul was the seat of the famous Maharal of Prague , one of the greatest Torah scholars and community leaders of the last 500 years. The Maharal is also the protagonist in the famous Golem story and the one who brought the Golem to life.

The the Alt-Noy Shul dates back to the early 1400s and it has true gothic architecture but, more importantly, the walls ooze authenticity and years of Jewish tradition and continuity . I cannot explain it in words but davening (praying) there 3 times on shabbat was a uniquely connected and connecting experience. This was especially true on a family trip, where we ourselves were three generations sitting together in this historic shul.

Two of my sons had the unique privilege to participate. My 6 year old son Moshe was asked to drink the kiddush wine on Friday night. Standing tall on the old wood benches, he said amen loudly, smilingly drinking wine from the rabbi's kiddush cup while my father and I looked on. I only wish I could have caught a photo but his pride is etched in my mind. (ed. The picture above was snuck after shabbat in the same place, without the wine and no flash)

On shabbat morning, my 13 year old Chaim read the haftara from the 600 year old stone bima, surrounded by family (including mother and grandmother peeking through the portholes from the women's section) and current and former generations of Prague's Jews who toiled to upkeep the Shul, its customs and traditions in the face of oppression and assimilation over the centuries. His loud voice and the consoling words of the haftara of Aniya So'ara reverberating off the cement and stone arched ceilings with their great acoustics still rings in my ears. I wish I had a video camera but the nachas of seeing my son read from the same bima as the Maharal likely did replays in my mind all the time. Timeless Nachas. I wish you all the same.

Having More Children is Good for the Economy

2011-08-15T13:12:00.005+03:00

Mark Thoma and Paul Krugman take off after newly announced Presidential Candidate Rick Perry this morning, claiming that the relative economic stability and job growth in Texas is suigeneris and do not indicate that conservative economic policies create jobs. Krugman almost mocks Perry saying that his economic policies are predicated on miracles, clearly a reference to Perry's Evangelical faith that the liberal Krugman clearly finds disturbing. Says Krugman:

"The Texas Unmiracle, by Paul Krugman, Commentary, NY Times: ...Rick Perry,... governor of Texas, has announced that he is running for president. And we already know what his campaign will be about: faith in miracles.
Some of these miracles will involve things that you’re liable to read in the Bible. But ... his campaign will probably center on a more secular theme: the alleged economic miracle in Texas, which, it’s often asserted, sailed through the Great Recession almost unscathed thanks to conservative economic policies. And Mr. Perry will claim that he can restore prosperity to America by applying the same policies at a national level."

A different part of Krugman's post caught my eye because I think it is similar to the economic story in Israel and why Israel has also been a relatively stable ship in an otherwise stormy economic sea. Says Krugman again:

So where does the notion of a Texas miracle come from? Mainly from ... faster population growth than the rest of America — about twice as fast since 1990. Several factors underlie this rapid population growth: a high birth rate, immigration from Mexico, and inward migration of Americans from other states...

In my opinion, there is a strong correlation between population growth/birth rates and economic growth in mature economies (even though much research (here, Here)debates this). The research in my opinion, takes too short a view of the phenomenon. Slowing birth rates help per capita income and disposable income for a time which leads to "economic growth" but it sets in motion the dynamics for slowing economic growth when the population peaks and begins to gray. It is not an accident that Europe is slowing to an economic crawl because you can find nary a child in a park in any European city. The US is slowing down because birth rates in the US have come down over the last 40 years but they are still in much better shape than Europe and Japan (two very stagnant/declining economies). It is not an accident that Baby Boomers coincided with economic growth.

Harry Dent points this trend out well in his demographic-biased economic analysis of boom and busts. Says Dent:

"Economic boom times are associated with increasing size of the mid-forties population and bust times are associated with a decreasing size of this population."

You have to keep having kids to have more and more 40 year olds. If you have less children in the next generation, you will have a contraction!

The same is true in Israel where the birth rate stands at 2.96 children per family, well above the replacement rate, and the economy has come through the global economic crisis better than most just like Texas. The obvious economic reasons are that there are more consumers buying and more available labor that keeps labor costs under control. The less obvious reasons in my opinion are that those having more children are fundamentally more optimistic about the future, less prone to Malthusian depression or self pity. You are also forced to work harder and be more productive to feed all those mouths.

Call it faith in the future, the miracle of birth or whatever you want Mr. Krugman but it could be that the long term future belongs to those countries and even states that are most fruitful and multiply both their brood and economies.

*If anyone has research showing positive long term correlation and causality between higher birth rates and economic growth, please post in comments.

From Rothschild to the Kotel: A Tisha B'av of Unity: משדרות רוטשילד לכותל, תשעה באב של אחדות

2011-08-10T21:24:00.005+03:00

I spent the evening of Tisha B'av with the tent protest on Rothschild Street in Tel Aviv. I brought 3 of my children and 4 of their teenage friends to what was a very different Tisha B'av experience than any of us had before. I read Megillat Eicha on the "floor" and we followed with my good friend Hili Tropper telling over the story of Kamtza and Bar Kamtza from the Talmud. An incredible discussion and yearning for unity emerged. See the videos below (in Hebrew). I ended the day by going to the Western Wall (the Kotel for mincha). There too there was unity on display, albeit with a very different group of people than on Rothschild the night before. The singing (video below) in unison was inspiring as well. May this all be a sign of Am Yisrael coming together again as one. Amen.

נדדתי בליל תשעה באב למחאת האוהלים בשדרות רוטשילד בתל אביב. הבאתי איתי 3 מילדי ו4 מחבריהם בגילאי הבגרות למה שרק אפשר לקרוא חווית תשעה באב לגמרי אחרת. קראתי מגילת איכה על רצפת רוטשילד שמסביב יהודים יקרים שלחלקם, אם לא רובם, זה היה קריאת המגילה הראשונה בחייהם שלא לדבר על צום. אחרי קריאת המגילה ידידי הטוב חילי טרופר סיפר את סיפור קמצא ובר קמצא שמחמת אירוע זה לפי חז"ל נחרבה בית המקדש השני. בעקבות הסיפור התפתח דיון ער ומעניין על ישראל העכשווית שכללה כמיהה אמיתית לאחדות. ראו את הסרטונים למטה. למחרת גמרנו את הצום בתפילת מנחה בכותל המערבי. גם שם האחדות חגגה עם קבוצה לגמרי אחרת של יהודים מאלה שהיו ברוטשילד בליל ט באב. השירה ביחד היה מרגש במיוחד. יהי ררצון שאחדות זה יסמן עתיד מאוחד יותר לכל עם ישראל. אמן!

וזה מה שכתבה אחת החברות של ביתי

אתמול,ערב תשעה באב נסענו אני וחברותי עם אבא של חברה שלי לרח רוטשילד בתל אביב למחאת האהלים המפורסמת קראנו מגילת איכה כמו כל ערב תשעה באב ואחר כך קראנו יחד את הסיפור של קמצא ובר קמצא שעל פי

המסורת היהודית נחרב בי המקדש בגללו -הסיפור שמתאר הרבה שנאה השפלה והלבנת פנים ברבים.

אתמול,ערב תשעה באב ערב שאנו מתאבלים על חורבן בית המקדש שנחרב בגלל שנאת חינם ויבנה בגלל אהבת חינם הרגשתי אהבת חינם,הרגשתי עם ישראל מאוחד מתמיד..כל העם היה שם!כל המגזרים..דתיים וחילונים מזרחים ואשכנזים וכולם התאחדו סביב קריאת המגילה כולם שמעו בהשתוקקות את הסיפור של קמצא ובר קמצא . לאחר מכן היתה אפשרות לכל אחד לאמר את דעתו ומה שהוא חושב וכמעט כל אחד שדיבר שיבח את העם שלנו,שיבח את הסיטואציה בה כולם היו יחד,התאחדו למטרה

דווקא בערב זה ערב שמתאבלים על ההשלכות של חוסר בית מקדש כמו הקרע בעם דווקא אתמול הרגשתי שהעם שלנו מאוחד יותר מתמיד.. עלינו לדעת שהרצון לאיחוד הוא הדדי ,גם הקיבוצניקים וגם המתנחלים גם השמאלנים וגם הימנים גם הדתיים וגם החילונים כולם בעד סדר חדש ובירור מחודש כולם בעד איחוד ופחות שנאה וסטיגמות...

כך שהמצב שלנו דיי טוב..כי את הצעד הגדול כבר עשינו ,כולנו רוצים להיות יחד וכמובן להמשיך ולהוקיר בשוני אבל אסור שהשוני הזה ימנע ממנו לאהוב את השני באהבת חינם אמיתית

ע. כ.

Alignment of Interests Requires New and Different Metrics

2011-08-04T21:32:00.004+03:00

Umair Haque wrote quite the blog entitled "How to Build A 21st Century Investment Bank" that I posted a fairly long comment on and that I now want to expand into a post. I am still waiting for Umair's feedback that I hope will come soon.

Umair opened with,

"Let's admit it. Finance as we know it is, despite the protestations of your friendly local narcisisstically sociopathic investment banker, pretty much useless to people, society, and humanity. It's an engine of crisis and instability (when it's not a motive force of dumbification and social fracture)--far from a lever of human prosperity, it's more a bulldozer of great achievement."

He then proceeds to lay out some very rough (by his own admission) examples of more socially and financially responsible deals and financings. Here are two examples from Umair's post:

I (CEO) receive options as part of my compensation package. If my company seriously harms people, communities, or society, my options vest, my shares are sold, and the proceeds go to charity.
I (community) buy a product from you (bank). Indexed to authentic measures of human prosperity, it pays out if the needle doesn't move upwards. Call it "stagnation insurance".

Umair - It is important to recreate investment banking to focus on the total cost of financing. It is absolutely necessary to realign incentives from net profit-based short term profits on an institutional level and annual bonus on a personal level to something that better reflects a holistic long term view of value/profit.

However, in order to do that, I think it would be most important if you focused on two things:
1. A measure or metric that can be used to determine the value or profit that investment banks, banks or financial institutions create and how that will impact institutional value and personal financial reward (that is still the fastest way to motivate a shift).
2. We need a killer app that proves the total-value view of banking or investment banking. This would be a killer product on which the thesis of holistic value and profits can be measured and rewards delivered based on it.

I would humbly suggest that an initial killer app could be social mortgages. What if we aligned incentives for banks/brokers etc with the home buyers such that bankers were bonused based on the home buyer successfully paying of his mortgage rather than the profits from interest and foreclosures. That would be long term focused and would align interests. Further, we could tap social nets to help people pay off parts of their mortgage when the goings get tough and encourage the banker/broker to help recruit the social circle because he too wants to get the mortgage paid down over time. So by changing one metric of success from short term profits to a simple metric like successful mortgage payoff , we could see a total-value benefit. Fewer people would lose their homes to foreclosures, be stressed by usurious short term interest rates etc. Total net cash profit of a corporation is such a crude measurement tool.

In fact, we need to align incentives and metrics of success on both a micro and macro economic level. As I look out now at the protests sweeping Israel in what could be the first very peaceful Eudaimonic revolution (to use one of Umair's terms), It behooves us all to rethink alignment of our economy to more shared goals. This needs new metrics. If it can;t be measured it will be tough to improve it and coalesce around a goal. The retrenchment of the economy and of mutual social responsibility should be a clarion call for rethinking te types of taxes/revenues we want to raise as well as the people and things society should spend on. It is a unique crisis that we can ill-afford to squander like Obama has squandered it in the USA since 2008. We can use taxes in a positive way to tax short term unproductive economic activities (say day trading) and provide tax incentives on disruptive and enriching goals from sustainable agriculture to exports to long term investment in disruptive technology. But we need to be able to measure our aligned-success with new holistic measurements.

So the key is metrics. If we can fashion total-value or holistic-profit metrics that align incentives and interests between financier and financee then we can begin to change this industry and economies for the betterment of society and business. I for one would love if Umair would work with the lab and develop these metrics product by product in financial services.

*****************************************************************
I wrote a now anachronistic post asking why we need banks at all a few years back http://seekingalpha.com/article/120207-why-do-we-need-banks-at-all

The Israeli Government's Ugliest Website, אתר הכי מכוער של ממשלת ישראל

2011-07-27T13:34:00.004+03:00

The following Facebook post/conversation, gave me the idea to run a poll for the ugliest Israeli Government website. The current top 3 nominees follow the Facebook Screenshot below. Please vote for the ugliest one in the comments section below or suggest your own nominee.

הפוסט שפרסמתי בפייסבוק המופיע למטה, הניב רעיון לתחרות "האתר אינטרנט הכי מכוער של ממשלת ישראל." 3 המועמדים המובילים מופיעים למטה מתחת למסך מפייסבוק. נא להצביע בטוקבקים למטה עבור האתר הכי מכוער. לחילופין, אפשר להציע מועמד נוסף.

Masbirim מסבירים

הרשות השופטת Court System

Bank of Israel בנק ישראל

One Side Note: The Bank of Israel is displaying their new design for bills but not for its ugly website!

Fix Political Leadership With A Constitutional Amendment for Longer Terms and No Reelection

2011-07-26T01:35:00.006+03:00

As Washington engages in a game of Chicken on the debt ceiling, it is worth considering some structural solutions to solving the problems of America. I am not talking about cutting entitlements, which must be done, or raising revenues, which must be done, but something far more fundamental.

You see, what is broken in America, and in many democracies for that matter, is leadership. The debt ceiling is a symptom. Politicians are so focused on getting elected and staying in office that they forget why they went into politics in the first place. Or, at least why they should have considered politics in the first place. Most, nay...all, of our feckless "leaders" are focused on posturing for elections. President Obama, either purposely or subconsciously, indicated as much when he said that any deal on the debt ceiling and spending cuts must take us through the next election. It is all about getting elected. None of Americas "leaders" in Congress or the Oval Office have the cajones to make leadership decisions, break stupid pledges and just do what is right. They are no Abe Lincolns.

Given the sorry state of leadership in 2011, it is worth considering fundamentally altering the Constitution's view on elections. I would propose that Presidents be elected for at least 6 years (maybe 8) but have a 1 term limit. No re-election. This should give them enough time to make a difference and not fret another election. Senators, who already have 6 year terms, should be limited to two terms and or perhaps one ten year term. And representatives, should be given 5 year terms with a second term possible if they get a super majority of votes.

Longer terms will provide stability. No option of re-election will mean that posturing for reelection will be a waste of time. You can just do what is right. It will also put an end to recycling politicians in Washington and likely reduce corruption since it takes a long time to cozy up to someone inside the Beltway. Taken together though, it will give a chance to people who truly want to make a difference and want to be leaders to take the risks needed in leadership without fear of being punished at the ballot box. It also means that more talented people will come into Politics because you will need to have made a name for yourself; you can serve your country and go back to what you were doing.

Now, what are the odds that some sitting politician will put electoral reform on the agenda for a constitutional amendment? Are there any leaders out there?

Why Israeli Start Ups Should Be Paying Attention To the US Debt Discussion

2011-07-25T17:20:00.004+03:00

I have written endlessly about the impact of the declining US Dollar on the cost of R&D in Israel. The political game of Mexican Chicken being played out in Washington over the debt ceiling, whether it ends in a short term deal of not, should be of concern to Israeli CEOs and to the government.

The long term trend of USD:NIS exchange rates is clear. The US economy is declining at a faster rate than the Israeli economy (which is growing nicely). The US is in danger of losing its status as reserve currency (I would argue that we are already partially down that path) and the political deadlock in Washington shows how dysfunctional US Politics is (more on that in my next post).

Today on Bloomberg (worth watching the video), PIMCO's Mohammed El Erian said,

that it will be a “big, big mess” if the U.S. defaults, spurring a sell-off in equities, the U.S. dollar and commodities excluding gold...The U.S. is the supplier of the reserve currency. The U.S. is the provider of a financial system that intermediates other people’s savings and investments. The U.S. is a AAA. The question is whether the U.S. can maintain a AAA.”

The Shekel has strengthened dramatically against the USD in the last 12+ months as per my previous posts. But, it has stayed in a reasonably tight range for the last 45 days. That may be in danger of unraveling, making R&D and operations in Israel even more expensive relative to the USA. Today, I met a company that has R&D management in Israel but develops everything in one of the FSU (Former Soviet Union) Countries where R&D is cheaper. That is 15 jobs that should be in Israel.

The dropping dollar is not a black swan event. It is a neon swan, flashing like crazy. So if you are a CEO, what should you do? First, hedge your currency exposure out for at least 12 months of burn, if not more. Second, push your team for more productivity and more innovation. Third, think through the profitability of your business model and your assumptions that you grounded your business on - your costs are going up.

As I keep saying, we cannot control the exchange rate but this real currency issue should push us to be more awesome, more groundbreaking and more innovative. We need to move quickly on to new platforms and be on the bleeding edge. Without it, we could lose our edge as a tech center of the world and with it many engineering jobs.

Helping My Daughter Help Ethiopian Immigrants...an Update

2011-07-21T23:57:00.004+03:00

This is a chance for a little Jewish Nachas and chance for all of you to help integrate Ethiopian Jews into Israeli Society.

Our oldest daughter Tamar has been working with Ethiopian children in an absorbtion centers for the last two years, spending many a shabbat on a mattress in a non-descript room in Mevasseret Zion. She also goes for hours every tuesday to work with the kids there.

Tamar had plans to run a summer camp for the kids this summer but the Jewish Agency withdrew funding for the program. About two weeks ago she looked for a solution and spent 48 hours (nights and days) putting together a Wix website and video (video editor was our son Sonny) in order to raise money for this camp. It does not take a lot of money to provide the Ethiopian immigrants a meaningful summer experience but it does take some.

I sent an email blast 10 days ago that seems to have traveled far and wide and many wonderful people across the world have made generous donations enabling the camp to get off the ground. Thank You!! Now, the camp starts in the 3 days so we are making a last minute push to raise more funding for these wonderful kids. Below is the video. Here is the link to the website and this is a direct link to donate. Below I pasted the heartfelt note Tamar sent by email. Please help Tamar help the kids and join in our nachas!

"Dear Friends,

This past year I, together with 15 friends, were part of an Ezra youth movement volunteer group taking responsibility for welcoming and nurturing approximately 70 Ethiopian children who made aliya within the last two years. These children and their families live in an absorption center in Mevaseret Zion (just north of Jerusalem). The culture shock the children experience in every area of their lives is unimaginable. To ease that transition, we provide the children with midweek after-school activities; take them on trips throughout the country and spend many shabatot together. We welcome them and integrate them into today's Israeli society and Jewish life. Through these activities we educate, entertain, enrich and show our love to these wonderful children. In turn, we are inspired by their unqualified happiness, hospitality and constant optimism. We have been warmly welcomed into their homes and lives and they have become part of ours. Now that the school year has come to an end, we hope to offer a summer program to ensure that the children use their time off from school wisely - with positive, enriching and fun activities keeping them occupied, creative, inspired and off the streets. The Jewish Agency has cut off most funding for this program and we are now also responsible for raising the funds to underwrite the summer program.

The overall goal of the summer program is to positively impact the children and facilitate their adapting to changes in their life. The cost of sponsoring one child is 200 NIS - but the impact is priceless. Please support us and the work we are doing and be a part of absorbing and integrating our Jewish brothers and sisters in the Holy Land.

Watch our video: http://www.youtube.com/watch?v=Grz5ai7oWA4 <http://www.youtube.com/watch?v=Grz5ai7oWA4> . For further information or to join and support our activities throughout the summer, please email EzraMevaseret@gmail.com<mailto:EzraMevaseret@gmail.com> mailto:EzraMevaseret@gmail.com>> or visit our website:www.wix.com/ezramevaseret/israel<http://www.wix.com/ezramevaseret/israel> <http://www.wix.com/ezramevaseret/israel> Donations can be in cash or by check made to*: Adiya Miller and mailed to: Adiya Miller, 42 Tesharnechovski St. Katamon, Israel, 92585. You can also donate through PayPal<http://www.wix.com/ezramevaseret/israel#!page-4>.

*Since we do not have tax exempt status, all donations must to be made out to Adiya Miller, the advisor.If you are paying by check or cash, please notify Adiya via Email (above) so we know to expect your donation.

On behalf of the children and ourselves, we thank you in advance!
Tamar"

Dearth of Engineering Talent in Israel

2011-07-14T13:54:00.004+03:00

In Part 1 of the Humus Manifesto (It would be a good idea to read it again) I complained about Israel's dearth of engineering talent for forward thinking architectures.

"...our talent is focused on the wrong technologies. I can't believe I am saying this but, as a country, we are developing yesterday's technologies or, more accurately, we are developing on yesterday's technologies....
When scale is the name of the game in cloud computing, Saas, internet and software development, we are a country of midgets. One of our companies, Conduit, needs to hire tens of internet engineers and is getting there because of their growth and size but it is not easy! It is a rate limiting factor on the scalability of a very high growth company and Conduit are the best at it in Israel. Facebook can hire at will in Silicon Valley but in Israel, we are talent constrained. Conduit's hiring success is very very hard work and it is the outlier and not the norm. Avishai Avrahami, CEO of Wix (another of our companies) told me "My business grows at over 10% a month but my competitors will catch me because I cannot find Java and Ruby on Rails talent in Israel. I cannot find any engineers with experience in scaling big data centers for many customers. I am willing to pay top wages but I cannot find the talent. I am flying to Russia to find or buy talent."

Now some proof: I received this email from a friend who is an entrepreneur, moaning that two of Benchmark's portfolio companies were vacuuming up all the talent in the marketplace. On one hand, I am happy it is our companies! On the other, this shortage threatens the innovation in our local start up pool. Read it and judge for yourself (I kept the writer and entrepreneur anonymous at their request). Editors note: Spelling and punctuation mistakes are the writers but I wanted the authentic version.

From:XXXX

"I wrote on every serious JS group i know and none are available,
in the past 2,3 month WIX.com are recruiting every js programer available (20 programmers and counting)
(even offerd me full time job for x2 i did in seekingalpha which i declined),
Also a few month before conduit was also recruiting (~10 very skillfull programers)
this is just a bad time to find a good client side programer.

recently i started working with programers from ukraine and romania which is proving to be
very succesfull.

If your goal is to develope tons of extantion using you current API this can be a perfect solution.
If you gola is to further develope and improve the API then you might need a serius expert that
currently is very hard to get (unless you have 40-50K / month)

My ears are allways open and if i'll hear on an available JS programer i'll send it to you right away."

הגיע הזמן! משרד האוצר מדרבן חדשנות

2011-07-12T20:10:00.004+03:00

כלכליסט (אסף גלעד) מדווח שמשרד האוצר החליט לכלול יותר חברות גדולות במסלול התמלוגים הגבוה למקבלי מענקים מהמדען הראשי. לטעמי, זהו אמנם צעד קטן אך מאד חשוב כי הוא מאותת שפני האוצר לחדשנות ולא לביטוח מאזנים.

במסגרת ההצעה תורחב ההגדרה של חברה גדולה, כך שיותר חברות יחויבו בתשלום תמלוגים גבוהים על מכירותיהן, וכן תועלה הריבית שעליהן לשלם בגין המענק שקיבלו.

תוגדר החברה כגדולה, יירד ל-70 מיליון דולר של הכנסות שנתיות במקום 100 מיליון דולר. לכך ישנן השלכות מרחיקות לכת על התמלוגים שמשלמות החברות מהכנסותיהן למדען הראשי.

אם עד כה שילמו החברות 3% ממכירותיהן, הרי שהורדת רף המינימום תכניס את אותן חברות ל"מועדון" החברות הגדולות המשלמות 5% מהמכירות. נציגי האוצר טענו בועדה כי הורדת הרף תפגע בחמש חברות בלבד במשק. נוסף על כך מציע האוצר להעלות את שער הריבית שיחול על ההחזר שמשלמות החברות הגדולות מריבית הפריים, לריבית הגבוהה ב-2% מריבית הליבור. עוד מבקש האוצר להחיל את חוק המו"פ גם על התעשייה המסורתית.

!המפתיע הוא שהמדען הראשי לא הציע את זה בעצמו

במניפסט החומוס פרק ב כתבתי

התמונה כוללת גם את השקעות המדען הראשי בחברות הגדולות. באופן מסתורי, גוגל מסוגלת לפתח את אנדרואיד, גוגל TV, גוגל אפס
וחידושים אחרים ללא סיוע מהמדען הראשי של ארה"ב. אפל, שנאבקה על חייה בסביבות שנת 2000

, אפל המציאה את האייפוד, האייפון, האייפד ואייטיונס ללא מימון מהמדען הראשי, אבל אי.סי.איי אינה מסוגלת לפתח את מוצרי הדור הבא ללא סיוע. הדבר תקף גם לגבי טאואר סמיקונדקטור.
אני לא מבין את זה. אם מדובר בהזדמנות כדאית מבחינה מסחרית או בשוק הגדול הבא לחברה ציבורית, על המנהלים לממן אותה מתזרים המזומנים השוטף או לגייס הון בבורסה. מדוע צריך משלם המסים לממן פרויקטים של חברה ציבורית כאשר הנהלת החברה עצמה אינה מאמינה שהם מצדיקים השקעה מתוך המאזן? ומה הסיכויים שהחברה באמת תשקיע את כספי הציבור שהועברו לידיה בפרויקטים שייצרו דבר חדש ומהפכני? זוהי בדיוק דרך הפעולה המוכיחה את צדקת התיאוריה של קליי כריסטנסן בספרו "Innovators Dilemma".

ח"כ רוברט אילטוב שפועל רבות למען תעשיית ההיי טק טועה במקרה הזה כשהוא מתנגד לשינוי המוצע על ידי האוצר. אסור לבלבל את הצורך לבנות חברות חדשניות גדולות עם חברות בינוניות וגדולות במונחים ישראלים שלוקחים את כספי משלם המיסים לממן פרויקטים שתקציבם ומאזנם אינם תומכים. אם הפרוייקטים היו החלטה כלכלית טובה אזי היו ממנים בעצמם. כנראה שמנכ"ל האוצר חיים שני שבא מאחת החברות הגדולות האלה מבין את הדבר הזה ומתחיל לפעול בכיוון הנכון.

***אני מבקש סליחה על הפורמט של הפוסט. אינני שולט בבלוגר בעברית

You can read Part 2 of the Humus Manifesto in English here.

Social Balkanization

2011-07-03T08:07:00.006+03:00

Lost in the endless reviews of Google+ is what another Social environment means for web publishers. For approximately 10 years, web publishers have focused on generating visits and traffic from social networks, using SEO, SEM and other Google friendly techniques. They also really only had to focus on one traffic hose: Google, which controlled 65+% of web search traffic. For the last few years, web publishers could safely focus on Facebook to generate traffic. Before that, Myspace was the 800 pound gorilla in social and though it did not generate a huge amount of traffic, web publishers (or widget makers at the time) could focus their attention on Myspace to generate traffic.

As Fred Wilson points out in yesterday's blog post entitled "Why I am Rooting for Google+" , all that is changing:

"Not everyone wants a Facebook experience; default private, mutual follow, best for close friends and family. Not everyone wants a Twitter experience; default public, asymmetric follow, best for broadcasting short burts of information to large networks. Not everyone wants a Tumblr experience; totally public, asymmetric follow, best for posting microchunked media."

I agree with Fred and think it goes beyond the modality of experience: People have multiple identities. They seek their financial analysis and interactions at Seeking Alpha differently than their entertainment on ESPN or MLB.com (see this friends exchange). And, they do it with different groups of friends or colleagues. I post on LinkedIn using professional language and on Facebook more colloquially. Likewise my comments on Seeking Alpha differ markedly from a comment I would post on the New York Post if I read it. This is actually not terribly different from real life where I interact with different people at a Bar Mitzvah than I would at a Wall Street Journal conference and I discuss different things with them.

Online, I maintain different social identities and I want to port those identities and groups to their appropriate experience. Here is where it is beginning to get tricky for web publishers. Web publishers need to ready themselves for customers and the way the customer wants to interact. With different people using different identities differently (that is a mouthful), a web publisher like the New York Post, Seeking Alpha, Hulu or ESPN and even my blog need to enable multiple identities so they can capture sharing and traffic from all of those identities and platforms. The New York Post wants the Twitter and Facebook traffic hose and communities to interact on the The NYpost.com and it is impossible to predict which of them will generate the most interaction. The same goes for brands like Nike or Pampers who are web publishers like any other today.

When we invested in Gigya, the leading provider of social login and social sharing solutions for web publishers, our biggest fear was that one network would own social sharing and identity. Then, in 2007, we feared Myspace. 12-18 months ago we feared that Facebook Connect would own web login and sharing. Today, as Fred points out, we have multiple networks for multiple needs, varied communities for a variety of interactions and different sharing patterns for different content.

If you are a web publisher, managing this balkanization and optimizing it is becoming complicated, to say the least. However, it is critical that you master it. When you get down to managing it, try to prioritize the top 2-4 networks that will lead to the most traffic. For example, Techcrunch has figured out that LinkedIn is more valuable today as a traffic source than Twitter. For Seeking Alpha, Twitter and LinkedIn are more important than Facebook. Still, however for most of the web, Facebook is the most important traffic source. It is still to early to tell where Google+ fits in to this picture.

Additionally, one of the lessons from Google's hegemony on web search is that the algorithm giveth and the algorithm taketh away. Just ask Demand Media (DMD) or Answers.com. The same will be true on Facebook, Twitter and LinkedIn as they grow and need to optimize their feeds for relevancy. Therefore, the best strategy is always to build organic traffic and have community interactions on your page. You do not need to create your own registration for that. You can leverage registrations of bigger social nets but then keep the feeds and interactions on your web sites. Spend time to analyze cross network scenarios and understand the commonality of those who visit your website who clearly have content and community affinity one for the other.

Managing this social balkanization is complex but it is a better web for all of us. The fragmented social web has fewer "single points of failure" or critical dependencies. And, that is good news for web publishers.

Full Disclosure: Gigya, Seeking Alpha and Twitter are Benchmark portfolio companies

We Have Enough Lawyers!

2011-06-15T08:23:00.005+03:00

I read with horror that 1714 of Israel's best and brightest are about to become licensed lawyers. (Some of my best friends are lawyers (and my father was one).) It is not that lawyers do not have a place in society but 1714 of our best and brightest? Let's try to imagine how we could change society by redirecting that brilliance to stuff that really matters.

Israel has a shortage of doctors. Israel has a shortage of biomedical and technology engineers. We have a national advantage in agricultural technology but not enough smart people going into agriculture or food related industries. Did I mention that food and sustainability as well as healthcare and healthcare costs are some of the biggest challenges facing the world today and Israel is in a position to be an international change agent in these fields? Imagine if our best and brightest applied their ambition and drive to create great industries, invent ingenious solutions to pressing problems and employ scores of people instead of creating the legaleaze and red tape that inhibits greatness and progress. Look at what my old friend Benzi Ronen is doing at Farmigo to bring healthier sustainable food directly to people's home and improve the income of America's farmers. Good thing he did not become a lawyer.

What about teachers? Imagine if these articulate, creative minds set about changing Israel's future by challenging our young people to think hard, ask questions and aspire for intellectual greatness. I shudder to think what would have happened to the challenged children of Ramle/Lod if Hili Tropper became a lawyer instead of the principal of Branco Weiss High School (Please click this link to watch this video) in Ramle! So why did 1714 of our best and brightest choose to argue the minutiae of contracts, gum up the legislative works and don the black robes?

I humbly suggest that as a society we do not respect the really important and transformational agents in our society. Becoming a doctor is a long process but it is transformational, same for biotech engineers. Teachers go un-respected and we have done nothing to change those impressions but they are the most important change agent for our nation's future. Partly because doctors and teachers are employees of the government, they are looked at and treated like bureaucrats. As a society, we pay them like bureaucrats, treat them like bureaucrats and tenure them like bureaucrats so when our ambitious kids grow up dreaming of greatness, the last think they want to become is a doctor-bureaucrat or a teacher-bureaucrat that needs to go on strike for respect and pay.

Our media glorifies the role of celebrity lawyers like Dov Weisglass and Ram Caspi but our kids barely hear about Hili Tropper, Gil Shwed, Simcha Blass or Dr. Hagai Karchi. They are not celebrities like they should be if we want to inspire our children for greatness and to help society. We see meglomaniac Ran Erez of the teachers union making headlines on the front page of newspapers while harming our children's education but no profiles of the teachers and principals of Leyada, Boyer or Horev High School in Jerusalem who are doing amazing work in education. Does that make sense? The people a society glorifies speaks volumes about its values and values drive professional aspiration. The professions that we choose to pay meaningful wages for also speaks to our societal values. We do not pay teachers and doctors per their investment in training and professional importance and that speaks volumes about how much we respect them and how important they are.

Again, do not misunderstand me, there is a place for lawyers in society. We need them too. But 1714 per year? How many potential doctors do we accept into our universities and how many of our aspiring doctors are forced to go to Italy, Hungary and other places to learn medicine? What is that message? When our kids read in the newspapers that doctors are on strike but 1714 lawyers will begin their apprenticeship this year and start climbing the income ladder, what can we expect? I will tell you: we can expect a further deterioration in our educational system, a further shortage of doctors and that we won't lead the world into the 21st century of technological change.

An Open Letter To Zeev Holtzman - The Sky Is Not Falling in Israel. It Is Getting Brighter

2011-05-31T07:19:00.009+03:00

Dear Zeev,

I have known you for a long time. You have been both a pioneer and a champion of Israel's venture industry and technology start ups. You are and were one of the leading lights during the last 18 years in which Israel transformed itself into Start Up Nation. So, as you can imagine, I was shocked to see in PE Hub that you are reported to say "Israel's Venture Capital and start up industry is headed for collapse." From my perch that could not be farther from the truth. In fact, what is happening is a great transformation of Start Up nation. Let me explain.

It is true that by your counting methodology, no venture capital funds were raised in 2010. However, Battery Ventures relocated a senior partner to Israel and built a team here to invest out of their main fund; Bessemer Ventures Partners hired a local partner to invest $100MM+ in Israel, Benchmark (where I work) is investing out of its main fund, Sequoia is investing at a prodigious pace and Greylock just announced a new fund focused on Europe and Israel. In addition, Accel Europe continues to invest in Israel and Index Ventures, with Saul Klein on the ground in Israel for the last 12 months, has deployed capital into Israeli start ups. Additionally, a number of companies have recently attracted very large rounds (cumulatively over $100MM), that brought other large funds to Israel. Wix (where I serve as a board member) raised $40MM from Insight Ventures and DAG. Kayma raised $18M from Kleiner Perkins and DFJ. Prime Sense raised $50MM from Silver Lake. To me, this does not feel like an industry on the verge of collapse.

You also say that "the industry, which is the economy's growth engine, is liable to be irreversibly damaged." Anything is liable to happen but in the last 6-12 months, I have witnessed and incredible inflow of deals and innovation, the likes of which I have not seen since 2000. In particular, entrepreneurs are focusing on really interesting initiatives in Mobile (where the world has finally caught up to one of Israel's great strengths), Cloud and Saas, and agricultural tech, where we lead the world. There is an incredible surge of innovation going on in Israel, focused on truly global markets and not just the US and Western Europe. They are not all getting funded but the best ones are, and this is good. I wrote in my Humus Manifesto (maybe you missed it, so here is a link to part 1) that one of the challenges facing Israel is that anyone who is an engineer starts a company, making it more difficult to find engineering and product talent with which to scale companies to the larger sizes needed to generate venture returns. Just yesterday, one of my early stage portfolio companies proudly told me that 3 of their new engineers were people who started a company, and then decided it would be better to join a venture backed company than to go out and raise money. That was a big win for Israel and for the ability of this venture-backed company to scale. This is representative of maturity and not of collapse of the venture industry as you suggest.

Scale brings me to the next topic. The challenge of Israel's venture capital "industry" has not been lack of government intervention, aid, assistance or anything else like that. There is no reason to send letters to Prime Minister Netanyahu. He is busy with Obama and getting the world off oil. The challenge has been that Israeli VCs have not grown big companies needed to generate venture returns for LPs. It is a known fact of the VC business that "Home Run" companies generate the bulk of returns for the entire industry. LinkedIN, Facebook, Paypal, Zynga and Groupon all could have been created in Israel but they were not. Hence, some LPs have turned negative on some Israeli VC funds. But this shakeout of both entrepreneurs joining VC backed companies and less VC funds in Israel is actually doing the trick. For the first time since I have been involved in Israeli VC, numerous entrepreneurs and their backers are "going for it." They are trying to build big blue and white companies, with the backing of their VC, who have long term views of the market and entrepreneurship. Ask Yaron Galai at Outbrain, Amobee CEO Zohar Levkovitz or Wix CEO Avishai Avrahami what the difference is between their last companies and their current companies. They are now going for it big time. Conduit's (where I am a board member and Benchmark is an investor) purchase of Wibya this week is a harbinger of things to come, where larger scale companies gobble up the products and talents of smaller companies in an attempt to build very valuable and very large companies in Israel that generate venture scale returns (the government has been properly helpful here with favorable tax treatment of Israeli companies buying other Israeli companies to bulk up). This is the great transformation going on in the market that favors both entrepreneurs and funds with a long term view and the ability to recruit executive and board level talent to grow large companies. And it is happening.

This great transformation has also created a niche in the investment world that value added angels and others like Avichai Nissenbaum and Yaniv Golan of LOOL, Sani Sanilevitch and Avi Domoshevitzki of Yatir and Kfir Moyal of Cyhawk are rushing in to fill. These micro funds are sprinkling money and help on very early entrepreneurs who develop innovative solutions that can be sold to companies that are looking to bulk up. As best as I can see, they are all raising money and entrepreneurs are running to them with innovative, low-capital-requirement projects. There must be $100MM sloshing around in these micro funds and in the pockets of angels who invest alongside them or instead of the micro funds. We have also witnessed a renaissance in the semiconductor space. A number of companies like Wintegra have sold recently and others like Siano and Wilocity (Benchmark company) have raised significant amounts of money. It seems like the capital is available to back industries where Israel truly has a global advantage.

Our country is not without challenges on the innovation side. We could use government investment in advanced research around, cloud, mobile, agriculture and high speed communication. We need help in recruiting executive talent for sales and marketing and we need some focused late stage funds to keep funding companies to become large players who can return meaningful sums to VCs and LPs. But the sky is not falling. In fact, it is getting bluer by the day. The shakeout in funds in the last ten years has enabled us to build larger companies. The arrival of longer term players has given the entrepreneurs courage to build big companies and recent technology trends are playing to our national advantages. Just today, one of my entrepreneurs currently living in Silicon Valley told me of 6-10 tech industry families coming home to Israel this summer because of opportunity. Israel is attracting the talent back home, richer for their experience of working in the Valley and scaling companies. Rooly Eliezrov founder of Gigya (another Benchmark company) told me today that he is "very excited to be coming back to Israel this summer since he thinks the Israeli start up industry has finally arrived. Now we can build big companies with the talent in Israel," said Rooly. So Zeev, we are actually in the first inning of the arrival of the great transformation of Start Up Nation into Scale Up Nation. All the pieces are coming into place: Bigger ambition, long term funders, returning scale-up talent and consolidation. This all makes me very optimistic. Scale Up Nation is on the march. I hope you will join us.

The Euro in the Eye of Stanley Fischer

2011-05-25T06:16:00.003+03:00

I have written frequently about Bank of Israel Governor Stanley Fischer's insightful views of market dynamics and insistence on surprising the markets. In that light, the world should take note of Fischer's raising of Israel's interest rates yesterday by 0.25%.

You see Fischer is looking to both cool off Israel's housing market and Israel's creeping inflation. However, Fischer's challenge in using interest rates to cool both of those indicators has been the strengthening Shekel, particularly against the US Dollar. The strengthening Shekel has become hard for Israel's export oriented economy whose most important market is the United States. The rising shekel is making Israel's tech workers and exports more expensive in Dollar terms and Fischer is walking a tightrope in trying to cool the economy and not hurting exports.

Therefore, the surprise increase in Israel's interest rates yesterday is worth noting. In my opinion, Fischer is spotting a significant weakening of the Euro due to the debt contagion and slowing economic growth in Europe. Fischer must believe that the debt and slower growth will likely hurt the Euro, forcing currency traders to flee to the "Safer" Dollar and strengthening the Dollar. This gives Fischer some leeway to raise interest on the Shekel, by using the weakening Euro and flight to the Sollar as air-cover to keep the Dollar:Shekel exchange rate relatively stable.

So if you are long Euros or long Euro Bonds, you may want to take note of the prescient Fischer and the interest rate on the Shekel.

President Obama's Speech on the Middle East - A Non Event

2011-05-20T16:26:00.002+03:00

I received a few notes to comment on President Obama's speech on the middle east. I was reluctant at first but here are some short thoughts.

President Obama's speech on the Middle East was a non-event. The primary target of Obama's highly anticipated speech was the Arab world and not the Israeli/Palestinian conflict and it represented a desperate attempt to find a firm and forward looking point of view on the dramatic events redrawing the Middle East over the last few months. Obama's rudderless policies and pronouncements at the outbreak of the Tunisian, Egyptian and Libyan revolutions and his meek response to the beginning of Bashar Assad's ruthless crackdown on Syrian protesters reinforced what both Americans and the international community now know about the President. He neither has a plan for changing America's economic course nor does he have a strategy for addressing the rapidly changing world he is encountering. In fact, the only change that Obama brought and that anyone believes in happened outside of the United States. Washington has remained status quo and the President's power and persuasiveness is weakening from Capitol Hill to Cairo.

This is now classic Obama. His instincts in foreign policy are detached from reality much like his economic policies. He made the early hallmark of his presidency an outreach to the muslim world and diplomacy with Iran. He misjudged the reality of Iran's belligerence to a point that has endangered the world and he muffed true opportunity for change in the muslim world when he wavered and waffled during the Egyptian revolution, alternatively backing Mubarak and the protesters. Obama may believe in change but he has not shown that he knows how to confront it or harness it. In yesterday's speech, he tried to correct course with oratory but it is not working. Killing Osama strengthened Obama for a minute but the world can see right through it to his weakness in leading Congress and a changing world. And they are rushing in to assume the mantle of leadership. Additionally, I think Americans care a lot less today about what happens in the Middle East. The deficit, healthcare, jobs and the Mexican border are far more burning issues for both the average and the intellectual American so history and diplomacy will need to be made in the Middle East and not in Washington going forward.

Which brings me to the President's pronouncements on the Israeli Palestinian issue. Only someone totally detached from reality can ignore Mahmoud Abbas' audacious rewriting of history in the New York Times this week as well as his embrace of Hamas and then merrily go on discussing peace. Obama's "frustration" is understandable. When you are microwaved from a community organizer to President of the United States, you think you can microwave peace as well. LIfe is not like that. It takes a long time to make peace especially when the 1993 Oslo accords led to nothing but more bloodshed and the withdrawal from Gaza brought 8000 missiles and a Palestinian population oppressed by ruthless Hamas killers taking orders from the butchers in Iran and Syria.

President Obama ought to do less oration and more listening. Even the Israeli left represented by the Smol Haleumi is not talking about peace but about annexing parts of Judea and Samaria and letting the Palestinians have a State on the other parts. Everyone, even Abbas, knows 1967 broders are not happening. But this is the President. He is detached from reality and focused on his positioning. He is trying to reattach himself to the Arab democracy movements but he has lost critical time and credibility. He is making small harsh pronouncements on Assad but ignoring the Iranian elephant in the room. He is trying to be more Arafat than Abbas on settlements and borders in order to appease the Arab street but he thereby boxed Abbas in, closing off all paths to negotiations. He is attempting to bully Netanyahu into "peace" but there is nobody on the other side. So, once again, Obama will be left on the wrong side of history as he was during the Egyptian revolution, the Iranian appeasement and the need to slash US government expenditures.

None of this should be seen as an attempt to absolve Prime Minister Netanyahu and the Israeli government, past and future, of blame for the current diplomatic mess. This generation of Israeli politicians has lost its nerve and verve. As I wrote on a recent Facebook post, Zionists always took initiatives. Today's Israeli governments only react, leaving the script to be written by others and and diplomacy to be governed by those who fill the vacuum for politics abhors a vacuum. We have ministers working at cross purposes, espousing mixed messages and generally fumbling both diplomacy and messaging. We have lost our self confidence in the righteousness of our ways because we stopped initiating. Greatness is achieved in entrepreneurship and state building when leaders initiate. The great people of Israel continue to create a successful Start Up Nation while successive governments squander the future with facile policies and confused messages. Paradoxically, this contributes to the average American's waning interest in Israel. The world has been inspired by the book Start Up nation because it is the "initiating little-engine-that-could" story of a small nation doing great things and actively making history. The early days of the state saw similar brazen initiative in agriculture, diplomacy, undercover operations and military victory but today they see defensiveness and mixed messages.

We need to initiate. I do not know whether initative should look like Naftali Bennet's suggestion to annex parts of Judea and Samaria immediately or whether it looks like the Smol Haleumi's annexation of the settlement blocks and building a state for the Palestinians. What I do know is that words are hollow and defensiveness and delay are deadly. If we do not take the initiative in the press, in diplomatic circles and even militarily, Abbas will write the history in the New York Times and the EU will rush in to fill the vacuum created by Obama's ineffectivness.

What Disruption Looks Like!

2011-05-17T18:34:00.003+03:00

With HP's early announcement of results that beat the market today but guided reduced earnings going forward and tough times ahead, I thought about the creative destruction in the market. On CNBC this morning, Leo Apotheker (see video) only referenced Japan's impact on the printer business, strategic shifts in Services and Consumer PC slowdowns. In reality, like RIM (Blackberry), MSFT and Nokia, HP is being disrupted.

So here it is in pictures:

As reflected in the stock market (ouch):

My partner Bill Gurley has written extensively about the Android freight train, the impact of tablets particularly on consumer PCs is becoming obvious to everyone but I think under-appreciated for HP and perhaps IBM is the impact (worth reading) of the consumerization of IT on the services business at HP and IBM. This is a massive structural shift that implies simpler services, less integration, self service and individual buying initiatives (not IT) and more web services or cloud solutions. HP is in the PC business and being disrupted by Apple and Android tablets. They do not play in mobile in any meaningful way, where more content consumption and computing is happening and the enterprise is changing dramatically. Disruption is upon us.

Real Measurement: Quantcast V. Alexa V. Compete.com

2011-05-09T14:41:00.006+03:00

One of the core tenets of the internet, internet media and internet advertising is that everything is measurable. Advertising and targeting users has become data driven science and businesses are more efficient because of it. Wix (A Benchmark company) for example, tweaks the time, text and offers in its email marketing based on detailed conversion analytics gathered every minute, optimizing marketing at an incredible frequency.

What I find surprising therefore, is the disparity in data that we accept from internet measurement companies. Fundamentally, there are two ways to measure internet traffic and engagement: sampling and real data (which requires pixel placement). Sampling was the state of the art measurement for TV and Radio because that was truly all that was technically feasible. Nielsen built an enormous business out of sampling audiences for TV, retail shopping and anything else that needed to be measured. The question is: why should we settle for sampling in the internet era when everything can be measured. Openly on the web, Compete.com uses sampling data from ISPs and Alexa uses Alexa toolbar data which is necessarily skewed by who installs the toolbar.

This is how Compete describes its data collection methodology:

How We Get Our Data
Compete's data comes from a statistically representative cross-section of 2 million consumers across the United States who have given permission to have their internet clickstream behaviors and opt-in survey responses analyzed anonymously as a new source of marketing research.

For contrast, Quantcast uses a pixel to accumulate real full data. From Quantcast's methodology:

Direct Measurement

In a major advancement over traditional panel-based measurement methodologies, Quantcast couples machine learning with massive quantities of directly measured data to deliver detailed audience data in real-time for all forms of digital media including websites, video, widgets and advertising campaigns.

Using Seeking Alpha (A Benchmark company) you can see a clear example of discrepancies in Unique Users between real measurement (Quantcast for Seeking Alpha) and Sampling (Compete.com for Seeking Alpha)

Compete.Com estimates that Seeking Alpha has 1.8MM Uniques per month

Quantcast puts Seeking Alpha's US user # at 3.9MM Uniques Per Month

Quantcast, using a pixel on Seeking Alpha's site measures more than double the US users for Seeking Alpha than Compete measures using its sampling data and also suggests a significantly larger growth curve. But let's dig more. Most of the Alexa data is relative (that is relative to other sites) so it is hard to find apples-apples comparisons but Alexa's estimates on Seeking Alpha's US vs. International traffic vary pretty widely from Quantcast.

Alexa estimates that 67% of Seeking Alpha's users are in the U.S.

Quantcast knows that almost 83% of SeekingAlpha's users are in the US

I would love to compare Page Views (PV) and Page Views Per Visit (PPV) between Quantcast and Compete but I could not bring myself to pay the premium membership for the sampling data at Compete. Contrasting Alexa data and Quantcast data, you can see an almost 100% discrepancy in Page Views Per Visit (PPV) when looking at the Seeking Alpha Data:

Alexa estimates that Seeking Alpha's Daily PPV per user is under 3

Quantcast knows that Seeking Alpha's Daily PPV per user is around 8

As I started perusing these sites, I found a few nuggets interesting. First of all, you are not required to publish your Quantcast data publicly but it does provide a measure of transparency that is reassuring to readers, partners and advertisers. For example, I tried looking up Techcrunch on Quantcast but the Data was hidden by the owner. The Compete.com data for TechCrunch showed a slide in users but my assumption is that were we to have the real data, we would see a similar reversal to what Seeking Alpha showed. Huffington Post is available on both Compete and Quantcast, with Compete showing almost a 10% drop before the recent rise and Quantcast showing only up and to the right (I assume the big spike in traffic is Osama Bin Laden driven).

I think the conclusions are pretty clear as to the advantages of direct measurement yet many entrepreneurs who come pitch us quote the Alexa data in particular very frequently.

Sharing Alpha

2011-04-13T21:05:00.003+03:00

I am biased (as an investor in Seeking Alpha) but I love Seeking Alpha's communication and transparency with contributors and readers (I am both). They share both their thought process and progress with the community in a way that is helpful and inspiring.

Below is the email I got today even if I did not hit the minimum threshold for a payout this quarter :(

Dear Michael,

Seeking Alpha has seen some amazing achievements in Q1, and we'd like to thank you for being a part of our success. We are currently ranked 350 among U.S. websites and have set our sights on some more amazing goals as we make our way through 2011.

Yesterday marked a Seeking Alpha milestone on two fronts: a reorientation of our approach to content, including a redesign of the home page, and the first-ever contributor payments for Q1 participants in the Premium Partnership Program (PPP).

Let's start with the latter. PPP has been successful beyond our expectations. Here are some of the key stats:
· 355 contributors participated in the program in Q1, including 219 that exceeded the $100 threshold and are being paid now
· 40 contributors will be receiving checks of more than $1,000; another 90 will receive checks of more than $500
· Average pageviews per premium article were an exceptional 5,558 - meaning average earnings per premium article were $55.58

While we always believed PPP would be only part of the total SA value-proposition to contributors - which also includes exposure, reputation, customer leads, etc. - to our delight some contributors are making meaningful money. We did not expect at this early stage average earnings of more than $50/article. We are thrilled that PPP has enabled contributors to combine the benefits of earning cash as a freelance investment analyst with the freedom of blogging. For those of you who haven't yet done so, testing out PPP is as simple as submitting an exclusive article to our submissions team; there are no long-term obligations or barriers to entry.

A couple of small notes: Q2 Author Boards currently reflect cumulative earnings for Q1 and Q2. We will shortly update the data so that each quarter displays separately. Also, on a tiny number of premium articles in Q1, unusual traffic patterns (high percentages of pageviews from one user) forced us to disqualify those articles from payment. We will continue to monitor traffic patterns to maintain the integrity of PPP.

What we've found so far is that Seeking Alpha readers are very focused on actionable investing ideas. Articles with follow-through to tangible investment ideas tend to generate substantially more pageviews than articles that are theoretical and lack ticker-tags which fail to answer the question: How can I invest in this? Because we're focused on maintaining our strength in actionable investment ideas and analysis, many of the recent website changes are likewise geared toward putting greater emphasis on actionable ideas.

Changes to our homepage include a greater focus on content, news, and market data. We hope to do a better job of answering investors' question: What do I need to know today? by uniquely combining real-time news and data with your insightful analysis, and our knowledgeable community. On the bottom half of the page, signed-in users will find the most recent articles by the contributors they follow - which we hope will give greater impact to the number of followers you have accumulated.

We've also reduced the number of dashboards to four: Long & Short Ideas, Investing for Income, ETFs & Portfolio Strategy, and Macro View. I believe these four do a good job of capturing the key reasons most users come to Seeking Alpha: to research stock ideas, fixed-income investing, portfolio analysis and asset-class allocation, and to follow the news and the economy. We also reduced the number of modules on each dashboard, and trimmed our sectors to the standard nine.

All of this has implications for leaderboards as well. Sector leaderboards will be reduced to nine, and 'dashboard theme' leaderboards will reflect the reduced number of modules on dashboards. In cases where modules were eliminated, we 'mapped' old ones to new ones (for example, Today's Market and Market Outlook are now one theme). In some cases this has resulted in changes to leaderboard standings as different groups grew and shrunk accordingly. Bear in mind that leaderboards are based on pageviews to articles over the trailing 90 days, so any anomalies should work themselves out of the system relatively quickly. We do realize that this change may create some initial unease, but it's important to understand that none of your pageviews has gone to waste, and all of them are being counted towards your overall rankings among our contributors. We highly value your contributions to Seeking Alpha and appreciate the time that goes into creating each article.

The best of the article crop will continue to be highlighted in specially designated sections, such as Editor's Picks and Most Popular. We've also added a link to the Readers Recommend section on the homepage. Most Popular sections also appear on the dashboards.

We like to think of Seeking Alpha as a work in progress, which is why we experiment quite a bit, and aren't afraid to try new things out. If you have a moment, come to the website and check out the changes - we'd love to know what you think. And feel free to contact me or our amazing Contributor Development department if you have any questions, concerns, compliments or suggestions. We're always available to work with you on finding the best ways to bring you and your content in front of our readers.

Abby Carmel
Head of Contributor Development

Look Out Below! The Dollar is Falling! What Now? Get Awesome!

2011-04-03T14:11:00.004+03:00

There is a famous joke/story about former Israeli Finance Minister Pinhas Sapir in which an aide comes to him and tells him that the economy is turning bad and rationing is necessary. Sapir asks the aide "and where is this?" to which the aide replied "Right here in Israel of course." Said Sapir, "Phew, that's OK. I thought things were bad in America."

For years the Israeli economy was pegged to the Dollar, the US economy and everything American, making Sapir's comment less humorous than it appears. However, after 2008, the Israeli and US economies disconnected, with the US economy stagnating and the Israeli economy growing at an even accelerated pace. This is due to both to Israeli innovation and the opening of global markets such as Eastern Europe, the Far East and Brazil to Israeli exports and entrepreneurs.

Sapir's mantra and US focus, however, is seared into the Israeli psyche and business assumptions. This causes both a focus on the Dollar/Shekel exchange rate and a real problem for companies whose principle market is the USA and whose functional currency is the Dollar. I have written very frequently in my posts about the Dollar Shekel exchange rate and the inevitable rise of the Shekel (barring a war), calling on our portfolio companies to hedge their currency risk and hold enough shekels for as long as possible. Despite Stanley Fischer's heroic maneuvers, even he understands that it is not possible to stop the Shekel's appreciation forever. He has slowed it to allow Israeli businesses to adapt but he cannot stop it. As Pimco's Bill Gross describes, without a big US political move on entitlements, the Dollar's decline is inevitable. With the Dollar likely (again, barring a physical or diplomatic war) moving closer to 3:1, it is important to focus on what Israel's competitive advantage is: Awesome Innovation.

As I wrote in parts 2 and 3 of the Humus Manifesto, Israel was never a low cost development zone. India and China were always cheaper. What Israel is good at is innovation. Actually, as Douglas Gayeton said, "Israelis are the world's best at making the most out of scant resources and this is the cornerstone of sustainability." Israeli entrepreneurs need to focus on this strength with the falling Dollar as a backdrop. We need to create awesome products that do good for the world. This is what will and does differentiate us. Better Place is not a "cheap" development (neither in Shekels nor Dollars) but it is staggeringly innovative on a scale that attracts global attention and has a shot at breaking the World's dependence on oil. Israel is a world leader in agricultural technology from water technology such as Netafim, to enhancing distribution for local farmers from Farmigo to Seed technology from Evogene. The Volcani Institute of Agricultural Research is a world leader and needs to be leveraged more as I wrote in Humus Part 3. Sustainable agriculture should get the focus of both the entrepreneurial community and the government and it is needed worldwide including in countries whose currency is not the Dollar. Lastly, Israel has an advanced mobile ecosystem (the mobile phone is a fixed appendage on every Israeli's ear) and with some focus we can create both a cottage industry and large companies in Mobile that attack the global markets. We can lead in these innovative global markets by doubling down on awesome innovation and not fretting the dollar. It should catalyze us for more meaning and more innovation, not more cost cutting.

I want to finish with a long quote from the Humus Manifesto

"We need to use this opportunity to retool our definition both of great technologies and a great economy. Part of our raison d'être in being here in Israel is to fulfill what the Prophets, Herzl and Ben Gurion all had in mind. That is: We, Israel and its citizens, should be an Or Lagoyim or Hevrat Mofet(loosely translated: An exemplary society). We should figure out which radical innovation does good while doing well and set it up here. We should make this a cornerstone of our drive into leadership of next century's economies and technologies (Hat tip to Umair Haque). We should think of economic advantage not only in terms of company's increasing profits and cash hoards but also in terms of increasing employment and creating places and a country where people want to work and feel good working at. The economy should serve to bind society and not divide it, creating a shared sense of purpose, nation-building and mutual responsibility. Our challenges in the technology industry and the world's economic challenges should be viewed as an opportunity to innovate our own business model away from some of Adam Smith's selfish motives and toward a community of trust and shared building. Let us, the people who gave the world the Ten Commandments, ethics and morality, innovate our way to both increasing GDP, generating jobs and inspiring generations and nations with a meaningful pursuit."

Look Out Below! The Dollar is Falling! What Now? Get Awesome!

2011-04-03T14:11:00.003+03:00

I want to finish with a long quote from the Humus Manifesto

"We need to use this opportunity to retool our definition both of great technologies and a great economy. Part of our raison d'être in being here in Israel is to fulfill what the Prophets, Herzl and Ben Gurion all had in mind. That is: We, Israel and its citizens, should be an Or Lagoyim or Hevrat Mofet(loosely translated: An exemplary society). We should figure out which radical innovation does good while doing well and set it up here. We should make this a cornerstone of our drive into leadership of next century's economies and technologies (Hat tip to Umair Haque). We should think of economic advantage not only in terms of company's increasing profits and cash hoards but also in terms of increasing employment and creating places and a country where people want to work and feel good working at. The economy should serve to bind society and not divide it, creating a shared sense of purpose, nation-building and mutual responsibility. Our challenges in the technology industry and the world's economic challenges should be viewed as an opportunity to innovate our own business model away from some of Adam Smith's selfish motives and toward a community of trust and shared building. Let us, the people who gave the world the Ten Commandments, ethics and morality, innovate our way to both increasing GDP, generating jobs and inspiring generations and nations with a meaningful pursuit."

An Open Letter to Employees of Snaptu: Please Stay In Israel!

2011-03-22T10:56:00.004+02:00

Dear Snaptu Employees,

Firstly, I would like to congratulate you and the founders of Snaptu on the sale of the Company to Facebook. The sale of the Company is both a personal milestone for all of you and a milestone for Israel. It is clear that you executed well on your mission to bring mobile apps to the tens of millions still living on feature phones. Mabrook!

Second, I would like to plead with you: Israel needs talented and successful engineers like you to fuel our continued growth as Start Up Nation. Reaching the milestone of delivering product into the complex mobile ecosystem, creating a user experience that is popular in Asia, and scaling that product and service to tens of millions of customers is a rare skill set in Start up Nation. We need to keep your important skills in Israel if we are ever going to become Grown Up Nation. All of Snaptu employees and talents are critical for the future success of Israel's tech industry. As an industry, we need to recycle and redeploy your considerable talents to other Israeli companies so we can scale companies to big sizes here in Israel. I am certain that growing companies like Conduit, Wix, Contendo, Face.com and MyHeritage, as well as countless mobile start ups, would be interested in your immense talents. If you need help getting to them, I invite you to email me to Michael at Benchmark dot com. I will be happy to help you find challenging employment at great companies growing here in Israel.

We are all extremely proud of what you accomplished and it is certainly your זכות to choose to go wherever you want to use the skills you have built, Palo Alto or wherever. However, I hope you will choose your אחריות and ציונות and stay here in Israel to build the the next Facebook right here in Start up Nation!

Thank you from all of us

ME

Don't Forget Egypt

2011-02-22T10:02:00.003+02:00

The world is a crazy place right now. It is such a whirlwind of political and seismic earthquakes that yesterday's revolution in Egypt is starting to feel as far away as the French Revolution. With the LIbyan's defying madman Qadaffi and the earth shaking in Bahrain, New Zealand, Saudi Arabia and God willing Iran, it is tough to stay focused on the brave people of Tahrir sqaure and their fight for Democracy. But stay focused we must.

Democracy, as Natan Sharansky, has pointed out, is not elections. Democracy is the ability of people to stand up in the town square and shout whatever is on your mind without fear of retribution. "Jimmy Carter Democracy," where the former peanut farmer turned president, turns up and declares that there were free and fair elections is a recipe for regime change and not true democracy. one set of free and fair elections in Egypt could yield the same result as what happened to the poor people of Gaza, a reign of terror by Hamas and other Islamic radicals.

The western world and world leaders need to focus together with the PEOPLE of Egypt on a Marshall Plan for Egypt, to put the economic and political infrastructure in place to transition Egypt to a free and vibrant democracy and growing free economy. Nobody should be distracted by the revolutions and chaos in other parts of the Middle East and North Africa. Egypt is the largest country in the neighborhood and as Egypt goes so should the rest of the Arab world.

This requires focus, fortitude and foresight. It will require massive investment in the economy and freedom. If the world is distracted, we could easily see radical Islam rise to power in Egypt and then the wonderful revolution of Egypt's young generation, our generation, will have gone for naught. Regime change to the Egyptian army or Hamas-like political-terror force is not an option for the free world and is not a future for Egypt. Let's stay focused and lock arms with the Egyptian youth for a better and truly democratic future.

Come on Tom!!!

2011-02-14T23:52:00.001+02:00

On my way to work this morning, I heard Israeli radio describe New York Times' columnist Tom Friedman's lambasting of the Israeli government in yesterday's NYT. When I got to the office, I calmly read Friedman's post online. Thankfully, on many levels, it was not as caustic nor as accurate as I assumed. In fact, I found myself agreeing with much of his main thesis but taking significant issue with his tangents, historical accuracy and the main victim of his piercing pen.

Friedman's core thesis is that Egypt was on a one way road to freedom and that quest should have been supported. Says Friedman based on a conversation with an "Egyptian Opposition Newspaper Editor":

This was about Egypt and about the longing of Egyptians for the most basic human rights, which were described to me by opposition Egyptian newspaper editor Ibrahim Essa as “freedom, dignity and justice.’’ It doesn’t get any more primal than that.

I agree.

Then the attack on Israel begins:

And when young Egyptians looked around the region and asked: Who is with us in this quest and who is not?, the two big countries they knew were against them were Israel and Saudi Arabia. Sad. The children of Egypt were having their liberation moment and the children of Israel decided to side with Pharaoh – right to the very end.

Quite an eloquent biblical analogy Tom, and even quite correct. However, you forgot to include the US, Barack Obama and most of Western Europe in your list. In fact, all western countries have been endlessly propping up dictators in the Middle East and standing behind the "Stability" Mubarak offered for too long. They were ALL on the wrong side of history. And Tom, you should know a lot about the dictators of Saudi Arabia. Didn't you cozy up to the King (then Crown Prince) years ago who whispered in your ear the Friedman/Abdullah plan for peace in the Middle East? You can read his mind, can't you? Isn't he an unstable dictator as well? I did not hear any concern then for the primal rights of Saudi Arabians? And, do you really think the Egyptian youth, yearning for freedom and starving for decent jobs and education were thinking of Israel?? But I digress.

Friedman then picks on his favorite target: Netanyahu's government. Writes, Friedman,

"Israel today has the most out-of-touch, in-bred, unimaginative and cliché-driven cabinet it has ever had."

Well, I partially agree with this as well. I actually think that the entire Knesset is out of touch, as is much of the US Congress and many other "leaders." The world is changing at a rapid pace, making terms and alliances of the past nonsensical; many politicians outdated and past notions of leadership anachronistic. Egypt, as Umair Haque (a true visionary blogger who was on the right side of history from the get-go) has argued, has taught the world a lesson from the cozy relationships between Washington and Wall Street to those between Jerusalem, Washington, Riyadh and Cairo. Nobody saw this revolution coming and few reacted correctly, not even you Tom. That does not excuse the reaction of the Israeli government but it does put it in context. I agree that given Israel's high tech experience the country should be behind social revolutions. We actually were in favor on Facebook (see below). However, the Israeli government is not Israel's democratic and forward-thinking high tech economy, nor, it turns out, is the State Department, nor the "disgusted" White House. Heck, our Knesset members do not even know how to use Facebook or Twitter themselves so unlike the uber-connected Obama, they may not have even heard of the Twitter revolution...

Which brings me to the next part of Friedman's post, President Obama. Friedman writes:

The Obama Administration and its utterly out-of-touch envoy Frank G. Wisner did not get this early on. But President Obama, or actually, Barack Obama – because he seemed to finally shuck off all his own expert advisers and give voice to his real, personal feelings – eloquently got America back in line with the real currents here with his post-Mubarak speech.

Come on Tom...Give me a break. The US administration was rudderless. As I wrote over a week ago, Obama kept feeling in the dark for the winner. And, as Hamid Dabashi wrote on CNN, this was not exactly Obama's Nobel Peace Prize Moment. Your rewriting of history around Obama's oratory skills does not become you, nor is it accurate. If Netanyahu and Israeli Defense Minister Barak were guilty then so was Barack. You should have said that they ("leaders") should have ALL sat quietly or found the right side of the revolution but it is easy to play selective Monday morning quarterback on a blog or under the New York Times masthead, especially with Netanyahu as the target.

Then Tom, you finally hit your stride, (and I applaud you for that) quoting from someone who knows more about dictatorships than anyone, Natan Sharansky. Writes Friedman of one of my heroes:

"I thought the one Israeli figure who totally got it right was former Soviet dissident Natan Sharansky, who, in a long-interview with the Jerusalem Post’s editor David Horovitz last Friday, said, according to Horovitz, “that partnerships with dictatorships are unsustainable – that people cannot permanently be repressed, that they will push for freedom the moment they sense weakness in their tyrannical leaderships. In his assessment, Israel and the West are fortunate that this Arab revolution is unfolding in countries still closely tied to the West, in societies yet to have been battered into an overwhelming retreat toward Islamic fundamentalism.’’
As Sharansky put it in his own words: “If the free world helps the people on the streets, and turns into the allies of these people instead of being the allies of the dictators, then there is a unique chance to build a new pact between the free world and the Arab world.”
I think he is exactly right – not because I know where Egypt is heading, or because I think it is on some smooth track now toward certain democracy. It is because I don’t know where Egypt is going. I just know this: the old order here has been broken."

Days before the WSJ article interviewing Sharansky and the Jerusalem Post article you referenced, I posted the below on Facebook, generating a bunch of supportive comments. You see Tom, the Israeli people remembered Sharansky's great book and vision, the basis for the Bush doctrine, even before the revolution's final outcome was decided. We just knew it. Even the Wall Street Journal "knew it" before Mubarak took off for Sharm. But not you, Tom.

It would appear to me, that it will take someone familiar either with tyranny like Sharansky, or members of the new young generation to get us, all of us, to find our authentic voice, understand new dynamics, organize and lead the 21st century. Sharansky was unschooled in the current world of politics and found himself outside the political system. But Sharansky knows authenticity and primal yearnings from the depth of KGB isolation. The new generation in Egypt, the US, Israel and elsewhere, yearning for a voice, has been outside the political system tweeting in frustration to be heard above the newspapers and the old political order. But we are now being starting to be heard. And, in Egypt they have started to lead. As the 21st century beckons, authenticity is rising above both oratory and autocracy, tweets are toppling tyranny and the feed is where you, Tom, can find all the news that is fit to contribute.

Saving a Life of a Special Woman Who Saved Many Lives

2011-02-10T23:54:00.001+02:00

An Article by Gal Beckman in The Forward about Enid Wurtman touched me, emotionally and personally. Enid Wurtman is my partner Elie's mother and she needs a kidney. I knew from Elie that she has been ill but, until the article, I did not know that she was in urgent need of a kidney.

Before the article, I knew that Enid was deeply involved in saving Soviet Jewry. Until the article, I did not appreciate how involved she was. I went to rallies outside in the UN in the cold. Enid went to freezing Moscow to share some light with the refuseniks.

Writes Gal:

That was the year (1973) Enid, a social worker, and her husband, Stuart, both in their early 30s and from Philadelphia, made their first visit to the Soviet Union, an eight-day trip to Moscow and Leningrad. It changed their lives. They met Soviet Jews who had been denied exit visas and were suffering all kinds of deprivation — losing their jobs, having their children thrown out of universities, their telephones cut off. Enid immediately identified with them. She felt as if she were seeing an alternate vision of how her own life would have turned out if her grandparents hadn’t left Russia. And she decided that she had to devote herself to helping these new friends.
Back in Philadelphia, she became involved with the local Soviet Jewry organizations and returned to the Soviet Union two more times in the 1970s to visit Yuli and others. One of her contacts was Anatoly Shcharansky (now Natan Sharansky), the charismatic, young spokesman of the activists. After a trip in 1976, she brought out a tape of Shcharansky rambling sweetly to his wife, Avital, then far away from him in Israel. On it, he says, “Enid asks how to help us. Yes, many people love us.”
In 1977, Enid herself made aliyah with her family. She felt she could no longer fight for others who were being denied the right to live in Israel while not taking the step herself. She never stopped working for Soviet Jews though, organizing protests, writing a column for the Jerusalem Post and keeping track of all the details of the activists’ lives — who was being detained, who was sick, who needed financial help. Yuli said there were years when they spoke on the phone every other day.
“Because of people like Enid, we could stand all the suffering,” said Yuli. “If these two million came out to freedom and if several thousand didn’t die, it’s thanks to people like Enid. She was completely devoted, crazy to the point where no logic, no family could stop her from helping us. It was almost an obsession.”

She started a fund, Emergency Aid for Refuseniks, and has worked tirelessly, while earning no income herself, keeping track of those former activists who need some kind of welfare and making sure they get it.
According to her old friend, Sharansky, “No one spent more energy in Israel to help those former refuseniks than Enid.”

Now, Enid, Elie's mother, needs help. She needs a kidney. So if you have information on potential Kidney donors, please help by contacting enid@wurtman.com

Celebrating The Obvious AND the Unsung Heroes of the Answers.com and MobileAccess Acquisitions

2011-02-05T23:18:00.007+02:00

Answers.com and MobileAccess, the two Israeli companies acquired last week, shared one thing in common: my former firm Israel Seed Partners invested in both of them. They share something else in common: both had near-death experiences before taking off. In the case of Answers.com, the company was basically out of money approximately 9 months before its ultimately successful small IPO and in the case of MobileAccess it went through bankruptcy proceedings.MobileAccess CEO Yehuda Holtzman and Answers.com founder and CEO Bob Rosenschein deserve accolades for their roles in leading these companies to success. I was closer to Bob and Answers so I can tell you from firsthand experience that the "pivot" from desktop software to webservice and from information-behind-a-word to instant answers was no easy feat. T

he foresight to acquire what ultimately became Wikianswers and propelled a

nswers.com to a top 50 internet property was all Bob's and he deserves this success. Yehuda went through multiple management changes over 12+ years and funding rounds galore and persevered to success. He too deserves this success. These two CEOs prove that perseverance and belief in your product and company can overcome many obstacles in the lives of a startup and new generations of entrepreneurs should learn from it.

I want to also highlight two unsung heroes who you will not find in the newspapers. My two former partners, Neil Cohen and Jon Medved. In each case, Neil in the case of MobileAccess and Jon in the case of Answers.com, they played pivotal roles to save the companies from death. Neil shepherded MobileAccess through the bankruptcy hearings. He was there in person, never wavering despite the abuse he took in the court room from creditors shouting and screaming at him. Neil arranged the funding with Millenium and shepherded that process as well. You won't see him in the PR on the acquisition but without his fortitude at the moment of truth, there would have been no acquisition of MobileAccess in 2011.

The Answers.com IPO was the result of Bob Rosenschein's insanely great salesmanship and vision and Jon Medved's perseverance. Jon arranged and recruited the bankers and investors that provided the bridge loan that saved Answers.com approximately 9 months before the IPO and Jon found the firm who was willing to take Answers.com public. That public financing was not your typical IPO and saved the Company, providing it fuel to live and ultimately flourish. When many investors (well known VCs and others) abandoned Answers.com and Bob, Jon did not. He rallied the troops and helped raise the money.

For all this, Yehuda, Bob, Jon and Neil deserve my thanks as well the appreciation of all of the employees of Answers.com and MobileAccess. Thanks.

Whose Side is Obama on Anyway?

2011-02-05T20:49:00.003+02:00

To be honest, I have been perplexed by President Obama's foreign policy since the beginning of his presidency. I struggled to find a common thread or theme. When the riots broke out in Egypt, I figured that since nobody saw them coming (except The Economist) the US would take its time, sit quietly on the sideline, learn the situation and formulate a response.

Instead, first the Obama administration issued some mealy mouth statements about democracy and non-violence, hedging between backing a long time ally and protecting the physical well-being of the protesters. The administration was clearly not backing the protesters at this point, angering the Egyptian street. Then, after what appeared to be some behind the scenes negotiations, President Mubarak issued a statement saying he would step down in September, the masses in Tahrir square called for Mubarak's head immediately and President Obama changed course again, calling for Mubarak to step down immediately to put it more politely than the President did. All of the sudden, Obama wants an immediate turn to "democracy" and response to protester's demands. The about face would be puzzling under any circumstance but it is particularly puzzling in light of Obama's deafening silence during the protests in Iran earlier last year. Where was the US Administration support for removing Ahmadinejad and the demands to hear the voice of the Iranian people? I have struggled to make sense of Obama's policy but I am coming to a thesis.

I think that Obama is like the kid who is new to football and does not have a team to root for so he roots for the winner of the last Super Bowl or the last game. Obama's foreign policy is to land on the side of the winner and be around for the next round. At the beginning of the uprising in Egypt, he thought that Mubarak would come out on top like Ahmadinejad, so he hedged his bets. As soon as the tide swayed and he spotted swelling support in the square and weakness in Mubarak's position, he swung to immediate support for the protesters, hoping to come out on the winning side. He did not support the protesters in Iran because he thought they had no chance to win against the mullahs and well, everyone loves a winner.

His speech to the Muslim world in Cairo at the beginning of his presidency can be seen in the same light. Obama correctly posits that muslims are asserting themselves successfully on the world political stage and he wants to get on that bandwagon. He disrespected Israeli Prime Minister Netanyahu because he thought that Netanyahu was a passing fancy as the Israeli left reorganized and that Israel was the ultimate loser in this negotiation with the Palestinians. When it became clear to Obama that Abu Mazen was weak and certainly not a sure winner, he abandoned him as well.

Obama not only wants to win on the foreign stage but like the kid whose newfound favorite team did not win the Super Bowl the next year, Obama looks for a new team throw his support behind in hopes of coming out a winner quickly. If the results are not immediate, he moves on and as I have written on this blog countless times before just like you cannot microwave peace, you cannot instantaneously resolve any diplomatic crisis. There are other examples such as Korea but I think the picture is reasonably clear that there is no consistent ideological doctrine nor realpolitik emanating from the White House. It just expedient chasing of winners who need to win now.

Unfortunately, in the fast changing sands of the Middle East, a rudderless foreign policy endangers lives as the Egyptians found out the day after Obama turned on a dime on Mubarak. And winner chasing is a recipe to build enemies in the Middle East who spot your weakness and disrespect its shallowness. Obama is likely to confront more challenges of this sort from Tunisia, Syria, Jordan and Saudi Arabia and I hope he can find the leadership skills and approach to lead, even if it means not winning the current battle. We live in a very challenging and volatile time in the world, expediency is not a winning strategy for the free world today.

Start up Nation: Army Exemptions for Who?

2011-01-31T06:13:00.003+02:00

I flew today on a small plane from Los Angeles to San Jose. A young man sat in the cramped seat next to me and it turned out he was on his way up to interview at a large internet company in Silicon Valley for a software engineering position. After asking me a series of questions in a southern drawl about Silicon Valley, he asked me where I lived. When I told him Israel, he began speaking to me in perfect Hebrew (This time without the Southern drawl).

I asked him about his Hebrew. He told me his father was sent to the US by Scitex 20 years ago when this young man was only 3. He goes back to Israel every few years to visit his grandparents including a few months ago; he went on a Birthright trip and loves Israel. Now, he is graduating a premier US Technology University in the summer and is interviewing for jobs. I asked him why he was not contemplating plying his engineering skills in Israel instead of Silicon Valley. He retorted, "The army will take me right away. And after 5 years in university I need to start working."

I was restless after this comment. Really restless. As a kid growing up in America, I never contemplated the Israeli Army and I was not drafted upon Aliya but it would have been tough to stare that down, not having been groomed for it as a kid. Yet, this young talent was resisting taking his Zionism to Israel because of the Army. This became more absurd when I thought about the fact that tens of thousands of young haredi avreichim, "studying" in kollels, are exempted from the army and are dependents of society and our tax dollars. Here was a talented young man who wanted to be a net contributor to jobs, taxes and the economy but was deterred by the Army's "threat" to draft him. (Do not misunderstand this as a call for exemptions. Quite the contrary, I believe every Israeli should serve and wish that I had been taken. But, you will agree that the paradox here is absurd.)

He did not move abroad (yerida) of choice. He was 3! His parents took him and he was not dodging the Army. We should be bending over backwards to encourage young adults, children of Israelis with family ties to Israel, to come back and we should drop barriers to bring them back to Israel. We need this talent. And, there are more like him among the children of the hundreds of thousands of Israelis who moved abroad as well as young talented Jews the world over. If we can accomodate the politicians who demand exemptions for those who then end up with "stipends", I hope we can find the visionary politicians who will chase and accomodate those talented young people who will create jobs and keep Start Up Nation kicking.

Restarting the Start Up Nation

2011-01-07T14:42:00.004+02:00

I had breakfast this week with one of my heroes, Saul Singer, who, along with Dan Senor, authored the best selling book on Israel's entrepreneurial culture, StartUp Nation. Saul and Dan, singlehandedly (or, shall I say, two-handedly) changed Israel's branding globally, framing Israel as a unique, fertile environment for entrepreneurship and breakthrough cross-disciplinary discoveries. Decades of impotent government ministers, bureaucrats and stillborn government branding initiatives that cost hundreds of millions did not accomplish what one book did: change Israel's branding and inspire millions. I have already tweeted that the Prime Minister of Lithuania mentioned in a meeting that I attended that his favorite book was "Start Up Nation." The book is in multiple reprintings in the USA, Korea, China and is even being published in Arabic.

Saul and I discussed his book, his learnings and interactions since the publishing of the book and my 3 part Humus Manifesto, brainstorming over a good Israeli breakfast (no Humus) on what should be next for the Start Up nation. He got me thinking about why the book was so successful and how we could leverage that to propel Israel forward and prove doubters like The Economist wrong.

The reason "Start Up Nation resonates is because it is authentic. It is not spin. It is real. Israel and Jews are good at innovation. It goes back actually almost 4000 years when the Jews "started up" as a nation, introducing monotheism to the world and then publishing the most successful book of all time, the Bible. We introduced moral and ethical codes in the Ten Commandments and the Torah. Over the years, there have been other great Jewish innovators and then we started a country 62 years ago against all odds like a great start up and we have been innovating in agriculture, technology, military (covert and otherwise) ever since. We are a start up people that has been forced to start over many times against all odds and it is inbred at this point in our nature. We are less good at scaling up, to the frustration of many including myself. As a keen commenter on a Wall Street Journal article pointed out, Jews started up this great religion but Jesus took it in a different direction entirely and harnessed the Roman Empire to scale it up. So we are the people of the Book and the idea and we are crucible for innovation and cross disciplinary innovators. That is our authentic calling. If that is the case, and all start ups need to focus, then maybe that startup focus is our next step.

The country should launch the Start Up Nation Institute. Israel should invite and generously fund the greatest scientific minds and innovators (read entrepreneurs) from all over the world in exciting and important fields such as biotech, agriculture, cloud computing, water technology, software and mobile devices. We should sit them together with our brilliant Israeli technologists and hutzpa-filled entrepreneurs in an open and beautiful setting for a number of years and give them access to university resources and simply let them germinate ideas that will solve the worlds' challenges from the same place that gave humanity the Bible and the Judeo Christian ethic. With enough smart and innovative people there (and Saul and Dan's insight), great companies and start ups will emerge. Don't put structure around. Israel should just seek the greatest minds from all over the world to come and bounce and test ideas off each other in Start Up Nation. It will inspire the brightest Jewish minds from all over the world to come and given the high quality of life in Israel, it will likely attract American, Chinese, Indian and Singaporean talent as well. All of those brains and skills from abroad can help us scale up when these ideas reach escape velocity. This will not be, as Chief Economic Advisor to the Prime Minister Professor Eugene Kandell (Hebrew) says, a short term project, but it will be both a powerful branding exercise and fertile ground for great entrepreneurs. And, that concentration of brain power will give us economic advantage for the future, focused on what we are best at, Starting Up! A Billion dollar investment in the world's greatest start up to ideate the innovations of the future should be what Start Up Nation is all about!

All Betters: A Review of Umair Haque's "New Capitalist Manifesto"

2011-01-02T18:26:00.005+02:00

I have been an avid reader of Umair Haque's blog (@umairh) for a while. I enjoy reading Umair for his witty rants and unflinching ability to call out tough problems and chart a different path. He is repetitive in the way the prophets were, calling out and confronting misdeeds over and over again because fundamentally the root causes never went away. Want some fries with that?

So as soon as Umair's book went on sale for the Kindle, I bought it and read the New Capitalist Manifesto in a week (it would have taken me less but the eight kids don't offer a lot of time for pleasure reading). I thought it also would be interesting to compare and contrast it with Matt Ridley's fascinating "The Rational Optimist" which I read before it.

Despite the fact that I always read Umair's blog, the Manifesto is still a must read. "The New Capitalist Manifesto" puts all of Umair's posts and rants into a coherent argument and blueprint. If you never read Umair's blog, run out now and get the book, read it and internalize it. Here is why:

1. This is not a book about economics. It is a book about life and meaning. A better, sounder economy and business is the outcome of greater meaning and explosive passion according to Haque and he is right. Therefore, it is a book about why we should get out of bed in the morning and seek to make the world a better place and not how we make another buck.

Over the last two weeks, I made presentations about entrepreneurship at two universities in Israel. In my powerpoint, I shared a somewhat blasphemous slide (below) showing the Bible (תנ"ך) alongside The Tanaitic Ethics of Our Fathers, alongside The New Capitalist Manifesto. I showed the slide because I think Umair's book is a reminder of the exhortation of the prophet Isaiah to take care of widows and orphans while earning an honest living and the sayings of the great Rabbis of 2000 years ago that "A good name is better than good oil."

2. The New Capitalist Manifesto implores us not to think about ourselves as the homo-economicus. It asks us and our political and business leaders to think about the interconnected world as one giant economic being. In fact, not only the living world but the inanimate world of resources. Not only the living and inanimate world that exists today but the unborn future worlds. This is a tall order, but as Umair points out in the book, not accounting for our children and grandchildren and the world of resources has a significantly negative impact on our own economic success. We can no longer borrow from the future, or leverage the planet or other, poorer, countries or communities to finance and power economic growth. Nor should we. We need to make tough decisions today to build better business, better relations and a better world.

Here is one of the money quotes: "Developing nations' growth comes to depend on overconsumption in developed nations, and developed nations' growth comes to depend on lending by developing nations. Yet that game of musical chairs..." This is not sustainable.

3. Umair's focus on value cycles is game-changing. It means that as a seller or marketer of goods and services, your responsibility does not end when the customer has taken possession. We need to think of the consequences of the products we sell after they have left our shelves (virtual or otherwise) and think of their impact on customers, the planet and others. This requires rethinking a lot of business learnings but more importantly opens the door to create disruptive advantage for those who master it. Umair calls these outputs "Betters" which he defines as "bundles of products and services that make a difference to people, communities and society by having a tangible, meaningful, enduring positive impact on them." In short, a real reason to get out of bed.

4. Umair has put his finger on a change in the social zeitgeist of the 21st century that I believe is not apparent to most leaders: Most people are fed up with mediocrity, fungability and money as a pursuit. I do not know whether it is the coldness of the computer screen that we all spend more time in front of, or the general decline in meaningful debate and leadership that seems to afflict the world today, or the unrelenting onslaught of shallow advertising and media. Whatever the reason, people are fed up. They look for employment today that has more meaning than money and they distrust leaders who are not authentic. Today's wired citizens of the world do not want fuzzy explanations. They want the straight scoop and they want leaders, business and political, who will make hard decisions and pay the personal price. We can tell fuzzy BS when we see it in business products and politics. This was not true 10 years ago but it is now. We know that Nokia's phones are not as good as Apple's. You feel it and touch it and read about it and no marketing in the world will affect that. As Umair writes, "advertising is all about achieving awareness, and we no longer need awareness. We need to become part of people's lives." We knew that Obama made no changes when he came to Washington. No spin would help. And we know that bailing out the banks instead of finding a better path forward for finance was kicking the can down the road. We know it so please do not fool yourselves. Umair gets this better than anyone and has now turned it into a business roadmap. Authenticity is critical for 21st century businesses so you better dig down deep and see if you have it now. If not, save your shareholders and get out the way because the New Capitalist Train is coming down the pike and Umair is its prophet.

The New Capitalist Manifesto will challenge your thinking whether you are thinking of starting a business or rethinking Walmart or Nike, one of Umair's shining examples (yes...Walmart and Nike). Entrepreneurs starting business should not be looking at optimizations, driving 1/10% out of advertising efficiency through ad arbitrage. Their mission statement should include the vision for their business and how this changes the world. As an example, when I think about what Seeking Alpha (Benchmark portfolio company) does, it is not that Seeking Alpha is a "better" financial media model. Rather, Seeking Alpha is fundamentally democratizing the world of financial information and tools and leveling that playing field. That is awesome and inspirational, befitting a new world of capitalism that Umair describes. If you have not figured it out, I highly recommend the book and hope that more companies, investments and startups follow its recipes for better business and a better world.

Will The Press and the Politicians Kill Israel's Economic Stability?

2011-01-02T15:40:00.004+02:00

I woke up this morning to two articles in the Hebrew press lambasting Governor of the Bank of Israel, Stanley Fischer's monetary policy. Both Calcalist and Themarker attacked Fischer for buying over $50 Billion in foreign currency over the last year. The basic underlying claim is that, given the dollar's decline and the discrepancy in interest rates between the shekel and the dollar, the paper losses on this currency trade were too much for the economy to handle. They both further claim that since the dollar continues to decline against the shekel, the markets are clearly overwhelming Fischer and proving him wrong.

I am not an economist, but As I have written about Fischer's policy in the past, I think that both papers miss the mark. Fischer's strategy has been clear to me from day one. He understands that Israel's economy is an export economy and that businesses could not absorb a sudden and dramatic increase in the Shekel's value. This is especially true in Israel, where the dollar has been the de-facto currency for 60 years. So what Fischer has essentially done is the let the shekel rise slowly so that exporters and businesses could adjust their budgets and hiring practices to prepare for a world of a stronger shekel. I am certain that had Fischer not intervened, the Shekel:Dollar exchange rate would be below 3 shekels to each dollar already and the export economy would have been decimated. Fischer's choice of weapons, surprise purchases of dollars on the open market had an additional target: currency speculators. He did not want them playing in the Shekel and radicalizing the moves in the currency so he kept them guessing. Fischer has been absolutely instrumental in keeping Israeli exports somewhat affordable despite discoveries of gas and a real estate market attracting all sorts of buyers which pushes the Shekel ever stronger.

This all makes today's announcement of an agreement to increase the minimum wage all the more surprising and, frankly, stupid. I am all for paying employees suitable wages. However, the Shekel's rise is not a question of if but how much. That is making our exports more expensive as we speak. Raising the minimum wage will simply further raise the costs of our exports and make Israel less competitive. It is just plain stupid and the timing could not be worse, unless of course you are a politician planning on running for office in the next 12 months and trying to buy votes while mortgaging our future national competitiveness. Please stop kicking the can down the road.

This is all raising the bar for our high tech economy as well. We need to create absolutely awesome products and services that the market will pay a premium for because the cost of doing business here has just gotten much more expensive. In the next decade, awesomeness will win and we need to aspire for business and societal greatness. Oh Dear government, please stop passing the Humus.

The New Wall Street Town Hall

2010-12-20T15:15:00.003+02:00

The IR Web Report opens today with coverage of Netflix CEO Reed Hastings' response on Seeking Alpha to Hedge Fund manager Whitney Tilson's explanation of his large short of Netflix's stock. Here is the opening statement:

"IN AN unusual move for a public company (emphasis mine) chief executive, Netflix (NASDAQ:NFLX) CEO Reed Hastings has responded via a blog post on the popular Seeking Alpha website to an investor who is shorting his company’s stock."

Reed's post is great: upfront, direct, data-driven, passionate, empathetic and forceful. Whitney's original explanation was well argued (though, like Reed, I disagreed with much of it). Most importantly, it was in the public eye. This is what IR report clearly found "unusual." In the clubby world of back room Wall Street, where information is confined to who you know and whether you can pay $2000 a month for a Bloomberg terminal, this, indeed, is unusual.

However, in a world where Wall Street meets Main Street and, as Umair Haque says in his New Capitalist Manifesto, where "Democracy is good for business," I think CEOs talking publicly, in full view of the world, is great for Wall Street and should become usual. Maybe the future is now. The great collapse of the banking sector and Wall Street in the Great Recession, showed everyone the need to shine a bright light on information about public companies, where pensioners and hedge funds alike have lots of money tied up. A public airing of the merits of owning a given stock and town hall discussion of its business is what the future of Wall Street and public stock ownership should be about. Public debate and public CEO comments make disclaimers irrelevant since everyone has the same information. It also enables public internet citizens to dissect all the data and bring critical eyes to bear on it. I wonder if the CEOs of banks were forced to defend their businesses publicly, whether the banks would have reached the crisis condition that they found themselves in in 2008.

Imagine forcing the banks to make their loan books public and having the citizenry analyze it. This is what Reed Hastings is sparking perhaps purposely and perhaps inadvertently. The world of public market investing should be like its name suggests, done in public. CEOs should respond to the market like Reed does.

Reed's and Whitney's entire posts are worth reading but Reed's final paragraph is fantastic.

To wrap up, I have to agree with my friend Whitney that there are many risks ahead for Netflix, that our valuation is substantial, and that it is possible that one could make money shorting Netflix today. But shorting a market leading firm as it is driving a huge new market is a very gutsy call. On balance, I would rather have my co-philanthropists on the long side of this particular bet.

Straightforward and honest (it is wise for Reed to acknowledge the risks since this is a public post) with a good insight. Hopefully, this is the future of public market investing, in the public view, with CEOs defending and pushing their case in public. (read the comments on Reed's post as well...democracy at work)

Stats Vs. Soul

2010-11-24T09:30:00.008+02:00

The above Facebook status update by my friend Alan Warms caught my eye yesterday.

Rodriguez has been an MVP, will likely hit 800 Home Runs, has 5 tools and a great glove, great run production, speed and career stats. Even at his advancing age, he has pretty good speed. Jeter? He has one thing: Soul. Great heart. Rodriguez broke his contract and wanted to leave the Yankees as Alan wrote, and was welcomed back with open arms and a huge contract. Why? because when the GMs and Arbitrators line those stats up on a sheet, Arod is at the top of the charts. Jeter? No MVPs, no batting championships or home run crowns. The arbitrator might not look on him kindly if it ever came to that. Oh, those 5 World Series Titles? A career Yankee? One of the "core4"? Playoff clutch player? Leaving it all on the field or bloodied in the stands? You can't bet on that for future run production as Jeter ages. This is where the Yankees have gone wrong and, frankly, where much of the business world has gone wrong.

Baseball is a team sport. Fantasy baseball is a statistics game. On a team, in a grueling 162 game season and long playoffs, heart wins more games than home runs. It does not make the highlight reel but it does impact your team/business in a real way. It is not an accident that Clemens, a pitcher with a great fastball and great career stats, won his World Series on Jeter's team. Same for Arod, Sabathia and others. Soul wins games, produces clutch hits and rallies the team to 9th inning comebacks. That is Jeter and it is why he is the most valuable player in baseball. No crises, flashy stats, public marital spats or dramatic run-ins with agents. Just steady as she goes with a feisty competitive soul, loyalty and team spirit.

When I look at an entrepreneur or a business, I am looking for Jeter, not Arod. Building a start up or any business is grueling like a 162 game season and worse. You need a lot of heart to push through tough situations and you need to step up in clutch negotiations and critical product and partner decisions and make the tough call to bring home the run. Your job as an entrepreneur is to make the people around you better, not win the MVP. You want to hire people who are better than you (You can bring Arod onto the team), who leverage your heart and win championship after championship. The flashy VP of Sales may be paid more in the short term but when you win, your equity pays off better and it should be obvious who is the soul of your start up. The business world has gotten too focused on stats and not on what matters, which is soul. When baseball players say that they understand that baseball is a business and hence accept the financial decisions that come with it, they are right. Baseball's business like other business is now, all stats and no soul, and that is what's wrong. I want entrepreneurs and businesses with deep Jeter souls who make everyone better and just win team championships.

Kids...Go Horse Around Under The Table

2010-11-21T22:43:00.006+02:00

When I was a kid, I remember going with my parents to a fancy home of the old-school "C family" in the center of Israel. We sat down for lunch at their dining room table, which was a slab of see-through glass on a wood swerving maze base. At one point in the meal, my parents began looking for my younger brother, then 3 years old. They could not find him around the house and then with Mr. C at the head of the table, they looked down through the glass to see my brother smiling and waving at them through the glass. Mr. C was apoplectic and my parents chuckled apologetically. The glass maze table was no place to horse around.

Well, all that is about to change. My sister, who was at the same meal and is now a mother of 7 herself, got tired of telling her kids to stop playing in, around and under the table. In the spirit of "if you can't beat em, join em," she designed these super fun table covers where kids can legitimately horse around under the table. The not-see-through design means your kids will not be smiling up at you like my brother did but it should provide hours of fun for your kids to make mischief and have fun in their own table-house. No more makeshift tent making that drags the table with it, it is all built into the Table Fables product that my sis designed and is now marketed by Nordstrom. You can get the dollhouse version or the school bus one. So if you have kids or you miss those days where you also smiled at your parents from under the table, you can buy them at Nordstrom.com (where it is a featured toys product right now) and start having fun right away.

Limassol, The Internet Capitol of Israel

2010-11-21T11:38:00.005+02:00

Here is a trivia question for you: Which city in our region has the highest concentration of Israeli internet people? If you answered Tel Aviv, you would be wrong. Tel Aviv may have the most but certainly not the highest concentration. The correct answer is Limassol, Cyprus, a short half hour flight from Tel Aviv where by my rough count there must be over 1,000 Israelis working in the internet sector.

More importantly, the Israelis working in Limassol have critical skills that Israel's fledgling internet industry needs. They have expertise in scaling internet companies and in marketing because the companies they work for have reached scale. Most of the internet industry in beautiful Limassol focuses on forex trading, porn (companies like Coolvision) and internet gambling, not exactly your Jewish mother's joy and pride. However, these businesses hit scale and the best employees that your entrepreneurial internet business can find come out of these businesses, such as Playtech, 888, Easyforex and others. Israelis are global leaders in online forex and gambling and they have been great training grounds for many internet entrepreneurs and employees.

The question is what can we do to bring this business and these highly skilled people back to Israel. We need their skills locally to jump start great internet entrepreneurial ventures. They are in Cyprus for both tax and regulatory (EU licensing) reasons but it is Israel that is losing out from this. So we need a plan to attract them back. Thoughts?

Great Hi Tech Businesses Like Conduit Also Create a Better Society

2010-11-01T05:41:00.003+02:00

For years, I have been involved (but not enough) in a social justice organization called B'maagalei Tzedek. Bmaagalei Zedek is an organization that looks out for those who Israeli society has lost sight of, the invisible people we run into every day. One of the causes that Bmaagalei Zedek has been fighting for is the rights of contract workers or, in Hebrew, עובדי קבלן. We see these workers every day. They are office cleaners, unarmed security guards, and other hourly workers who we run into in our offices and at cafes but we do not really see them or their plights. They are the working poor and are, often, poorly treated by the agencies that hire them and rent them out. These agencies look to reduce the costs of these laborers by not offering benefits and driving down salaries through frequent switching of workers. These are hardworking people, who often work two and three jobs just to finish the month and do not get government handouts or monthly stipends.

On Thursday, I received a call from Ronen Shilo, CEO of Conduit, one of our portfolio companies. The call made me both happy and proud. Ronen announced that earlier that day Conduit had decided to hire the three cleaning people who clean the Conduit office every day and to throw out the agency. By hiring the cleaners directly, Conduit significantly increased their take-home salary and gave them social benefits like every engineer. Conduit also granted these former contract workers stock options! Net cost to the Company? nearly zero. Value to the Company's soul, values and employees? Priceless! They deserve these stock options because the cleaners are responsible for the work environment that lets Conduit employees be so productive and help make Conduit a successful company.

The cleaners were elated, holding back tears of joy when they were formally hired by Conduit. They each hold down a few jobs and this will give them time with their family. Conduit was simply doing the right thing for everyone, yet so few, if any, other companies do this. The people behind Conduit have created an environment at Conduit that values hard work, teamwork, ingenuity and impeccable ethics. Those ethics and values increase the value of the company, our investment and society.

I would like to call on all high tech companies to follow Conduit's example. I know that small start-ups do not have the resources to manage this but any company that can afford a CFO or a VP of HR, should have the management bandwidth to put the cleaning people on the payroll. That is true of large companies and large start ups. The cleaners and other contract workers' salaries are barely noticeable next to the 30,000+ NIS engineer's salary and it makes a real difference in their lives and ours. Let us issue a clarion call to unbond these contract workers from their "agents" and better our society as well. ציון במשפט תיפדה ושביה בצדקה.

Conduit: Financial Analyst Position in the Bay Area

2010-10-24T18:22:00.000+02:00

Conduit is growing very very quickly & is Looking for a Financial Analyst in the Bay Area. Details below. Interested? Contact me.

Financial Analyst

The financial Analyst provides the company’s business and customer facing teams with Financial Planning and analysis required for ongoing sales operations and account management including: pricing, account performance metrics and customer value quotes.

Responsibilities

• Provide the business team with pricing models and financial terms

• Create economic projections for business performance

• Work with account management team to analyze and optimize the quantitative performance of key accounts.

• Assistance to the business Personnel with analytical and operational tasks

• Identify appropriate metrics to track and evaluate business performance.

• Track performance of biz team members Develop Scorecards for the business as needed

• Measure and track business performance against financial objectives, including revenue and commission reporting

• Ad hoc projects and analysis.

Skills

• B.A. or B.S. in Economics, Business, Finance or Accounting; MBA is preferred

• At least 2 years of experience in finance/accounting/ Sales Operations roles with an emphasis on financial planning and analysis

• Experience working with sales/business/distribution teams in a high-tech or software company

• Superior Microsoft Excel skills (pivot tables, macros, etc.), Proficiency in complex financial modeling

• Excellent quantitative analysis abilities with superb attention to detail and the ability to prioritize and deliver results in a fast-paced, dynamic environment.

• Exceptional verbal and written communication skills, Ability to think strategically as well as tactically

• Demonstrated ability to work effectively with cross-departmental teams

• Strong organizational, problem solving and presentation skills

• Strong initiative and desire to work in a team-oriented environment

• Self-starter with excellent time and project management skills

• Experience working with CRM systems (e.g. Salesforce.com) and business intelligence tools

• Knowledge of GAAP is a plus (including accruals and account reconciliations, revenue recognition

• Availability to work in flexible hours with remote global office.

Great Job Opportunity in Israel: Seeking Alpha is Looking for a VP of Finance

2010-09-14T00:20:00.000+02:00

VP Finance & Operations - Job Description

Seeking Alpha is recruiting a VP Finance & Operations to support its rapid growth. (Our current VP Finance is moving into the COO role.) The role is responsible for the planning and ongoing management of the company’s financial and operational infrastructure. To fulfill this role, the VP Finance & Ops will work closely with the entire Seeking Alpha management team.

Location: Herzliya Pituach
Reports to: CEO

Responsibilities

- Finance

Management of internal finance team including a Controller and Bookkeeper.
Responsibility for the company’s day to day finances and reporting activities
Work with management team on the company budget to ensure the company is optimally applying its resources to meet business goals
Control of cost base - ensure we are applying our financial resources to maximum effect on an ongoing basis
Communicate the company’s finance strategy to management, staff & investors.

Negotiation and management of all company legal documents including corporate, HR, suppliers and service providers.
Managing relationships with external finance & legal service providers.
Work with sales team to optimize sales from an inventory and HR perspective.

- Operations

Ensure smooth running of Israel and US offices.
Responsibility for a 5 person operations team which outsources certain company activities and handles our customer service.
Maintain a reliable IT infrastructure in conjunction with an external service provider.

Collaborate with appropriate departments to assess and recommend infrastructure that supports the company’s organizational needs.

- HR

Handle all HR related documentation and processes.
Manage all company salary and benefit schemes including US 401K & Medical, Israeli benefits, salary policy, MBO and ESOP.

Requirements

Previous responsibility for finance department at a senior Controller or VP Finance level
A minimum of 2 years small company (up to 100 employees) experience
A minimum of 4 years senior level experience
Hands-on mentality
Strong negotiation skills
English - Mother tongue
Hebrew - Fluent written and spoken

Advantages:

Start-up mindset a big plus
Hi-tech experience - especially web company
Accounting and / or legal qualification

Please send (will be treated as confidential)
A short cover letter answering the following questions:

What is your experience in managing a finance department and what were your greatest accomplishments and challenges?
Describe a finance / operations change led by you which achieved strategic value for your company.
What would you expect to accomplish in your first 3 months in the job?
What would you expect to accomplish in your first year in the job?
What makes you most excited about working for Seeking Alpha?

Please also include:

Your contact details
Your CV
Please send these to Persha Valman: persha@seekingalpha.com

The Hummus Manifesto - Part 3

2010-09-06T17:05:00.002+03:00

Vision and Decision

Thanks again to all the commenters, Facebook posters, tweeters and retweeters on this blog, SeekingAlpha and the Hebrew Version on Themarker.com. Now we need to turn this e-army into an army for change.

I want to try to lay out 3 framework principles for the fix:

1. What is at stake is national competitiveness and the Israel that we will ready for the 21st century, or not. It is not the success of individual companies but the economy and country as a whole.

2. Decision makers ought to make decisions and we need to look at the structure of decision making and those making it as part of this process. That will also help find the big budgets for change.

3. Let us not be afraid of big ideas nor to put some stakes in the ground for the sake of jumpstarting this discussion and our jump into this next century. And when I say Big Ideas it is not ONLY big business ideas but social, Jewish and moral ideas. In short, VISION!

We can't have it all. We can't do it all. And we can't split budget pies to semi-satisfy many constituents. That is a cop-out that serves nobody. We elect politicians to make decisions, even hard decisions. If they can't, send them home or they should voluntarily go home. We also cannot expect the government to do the work for the citizenry, we hope they can lay the groundwork, make smart investments that move a needle and stay out of the way and let private enterprise grow the economy. When the government tries to do much directly, it skews the market and invites corruption and bad decision making.

So we need to make some choices to jump-start our national competitiveness. We need to focus on a scant few areas and place some bets with massive budgets. And then, we the private sector, need to pour in to the areas in a big way. Those massive budgets are currently in the Chief Scientist's office where it is spent scatter-shot and in the Ministry of Defense where it is looked at through military eyes and not national eyes. Ironically, it is also in the education budget but it is not focused on our national competitiveness. This needs to change. I realize that there are few, if any, models of successful government intervention to jump start industries, with possibly the exception of the Korean focus on gaming, so we may need to invent a model but that should not scare us. We are a small country that can and should mobilize quickly and the challenge should inspire us to lead into the 21st century. I am convinced that Haim Shani in the Finance Ministry and Eugene Kandell in the Prime Minister's office get this. I am also certain that the bureaucratic roadblocks to focused strategy will be many so it is the job of our politicians, and us concerned citizens to mobilize and break this logjam. We need a super-coordinated strategy for innovation and not one that works at cross purposes.

This requires a cabinet level position of a Chief Investment Officer for Israel (CIO). The CIO will report to the cabinet and Prime Minister and have responsibility for the Chief Scientist, the Head of Army Technology and the Ministry of Science. The CIO should also have responsibility for university research investment budgets and a big budget of his own. I would suggest turning the Chief Scientist into this role but I fear a revolt in the Ministry of Industry and Trade (MoIT) and "Scientist" is not the right background for the role. Some political decisions may be too tough. With a Chief Investment Officer taking an overall view of the industry and coordinating all other pockets of funds, we stand a chance to invest in a coordinated manner and with a large enough budget from MoIT, Defense and Education to make a difference. It will also remove investment decision making from the crazy bureaucracy and decision making of the MoIT and its OCS. The CIO needs the mandate to make decisions much like Governor of the Bank of Israel Stanley Fischer does. He should be given a term of 6-10 years since these processes and industrial changes take a long time.

This is a core structure that Israel needs to put in place so it can act quickly to get our future national competitiveness in order. But the CIO needs a framework and before moving on to a practical set of suggestions for industry focus and tactics, I want to spend a few sentences on an economic and social vision for Israel in the 21st century.

We need to use this opportunity to retool our definition both of great technologies and a great economy. Part of our raison d'être in being here in Israel is to fulfill what the Prophets, Herzl and Ben Gurion all had in mind. That is: We, Israel and its citizens, should be an Or Lagoyim or Hevrat Mofet(loosely translated: An exemplary society). We should figure out which radical innovation does good while doing well and set it up here. We should make this a cornerstone of our drive into leadership of next century's economies and technologies (Hat tip to Umair Haque). We should think of economic advantage not only in terms of company's increasing profits and cash hoards but also in terms of increasing employment and creating places and a country where people want to work and feel good working at. The economy should serve to bind society and not divide it, creating a shared sense of purpose, nation-building and mutual responsibility. Our challenges in the technology industry and the world's economic challenges should be viewed as an opportunity to innovate our own business model away from some of Adam Smith's selfish motives and toward a community of trust and shared building. Let us, the people who gave the world the Ten Commandments, ethics and morality, innovate our way to both increasing GDP, generating jobs and inspiring generations and nations with a meaningful pursuit.

Focused Investment with Vision:

Armed with a CIO, what we do not need to or want to build is a Nokia (Sorry Minister of Finance Yuval Steinitz...). We have no interest in getting pneumonia when one company sneezes. The control Israel's tycoons and the government companies exert on the core economy scare us enough on that front. It stymies innovation as Guy Rolnick perceptively points out in this terrific analysis of the 50 best companies to work at in Israel and the USA. However, we need to be able to build more Checkpoints. We need another Amdocs and Teva. And we can do it. This jump start will necessarily come from ideas from the private sector, or, shall I say, the productive sector. It will come from all of you reading this if only the government would listen. However, someone in a leadership or builder role should lay out a vision for how these industries can transform economies and societies and why Israel should be central to that development.

In a small country like ours, we need to focus and catalyze industries. Nobody can know for certain what will be tomorrow's platforms and technologies but we need to make some bets. They won't all work nor should they. But they should be bold. So I want to drive a stake in the ground for the sake of debate and try to provide a framework for discussion:

1. Clean Energy

I am very skeptical on the whole clean tech space from a VC perspective. In fact, given capital shortages in Israel, I am skeptical that we can gather enough capital to drive cleantech innovation at the start up level in a massive way. But energy is an enormous economic catalyst and a big strategic issue for Israel in the region so we should use our advantages as a country to lead here. We need to do this by attracting big and small companies alike to try their innovations here and train our people in the skills needed to build a green collar economy. That is a growing and exportable skill set that is required globally.

We have abundant sunshine, ports, tourist attractions and a willingness to try new ideas. So, let's turn Eilat or Sderot into the first city in the world to be powered entirely by clean energy. Each of Eilat and Sderot would have national and economic benefits if chosen and both have abundant sunshine. We should invite American, Chinese and European companies to the world's first clean city to innovate their clean energy technologies at scale for running a modern city. And, we must invite Israeli innovations (in a preferred and funded way) to beta test there as a way to give them exposure to well funded and well-entrenched market partners and to give them advantages by letting them try innovations at scale. It is a way around our capital shortage and would catalyze and galvanize world leaders in innovation to take part in the first clean city. We could set up an offshoot of Ben Gurion University that would be a faculty for clean energy studies in Eilat or Sderot that would bring academic innovation as well. That will complete the cluster. With a little vision, this would attract world interest and help us lead in scaling clean energy to the needs of cities and it would put lots of Israelis to work and help them learn the skills of this emerging economy, much of it on the Euros and Yuan of foreign companies.

The closest thing to something as bombastic, patriotic and bleeding edge as this, is Project Better Place and I think it has done a lot of good for the country. Shai Agassi has brought over $300M in investment into our economy at a time when local venture capital is shrinking. That is what Big Hairy Audacious Projects do. They capture imagination and attract investment in a way venture capital is not doing right now in Israel. I do not know whether Better Place the company will succeed but on a national level it has already succeeded in training people in electric vehicles and attracting global attention to Israel the innovator. The Government should jump start a BHAG project like this Clean City idea.

When the army broke down in the second Lebanon War, Chief of Staff Gabi Ashkenazi and team poured billions of shekels in to get the wheels moving on training and now we have a much better-prepared army. We need a 5 Billion Shekel-plus project on the cutting edge of technology and scale like a clean city. That will get the wheels of innovation greased and attract world-leading companies to Israel. Again, remember that our first wave of tech success was helped by attracting growing leading tech companies like Motorola, National Semiconductor and Microsoft to Israel.

2. Cloud Computing

I hope we have not missed the boat here. The internet is here to stay and we need to get up to speed and scale quickly. Let us declare Israel the cloud computing center for this region of the world. We can lure Amazon and Google to build massive cloud data centers here with matching money and tax incentives. Maybe it is not too late to get Google to wire the entire country with broadband. The debate over whether to give Intel a $100MM grant or $400MM grant is an argument over one company and one city that has some tentacles into that city. The same $400M grant, matched by Google and/or Amazon would be the equivalent of building a railroad across our country. It is infrastructure that fundamentally increases our national competitiveness. We should invest in more underwater cables to expand bandwidth and not just leave it to the blessed initiative of the Borowitz's underwater cable. We could build multiple facilities in different parts of our tiny country affording Google and Amazon an easy way to manage this from a central location since the drive would not be far to any one data center. This would jive with the government's current initiative around financial innovation, all of which will move to cloud computing in the future.

As part of this move to the Cloud, we need to jump start some other initiatives to make sure we can support it. We need a MASSIVE government training program that will train Haredim, Dot-net engineers, out-of-work engineers and lawyers in the computer languages and architectures of the future such as C++, Ruby, PHP, Java and cloud computing architectures. We can do it through the universities by subsidizing courses in new languages or we can give tax credits to companies who train engineers in these technologies and employ people in those languages but, clearly, the government needs to pay for it. We can encourage Google, Amazon, Salesforce.com and Facebook to Israel to also open development centers and we can subsidize the cost of their engineers as they train our fantastic talent in web scalability and simple design. The engineers and people deserve this and our economy needs it. Zuckerberg, Benioff, and Brin are all Jewish and have all been here. We should help them employ our people and teach our smart engineers cloud computing and scalability.

To help our shift to the cloud and scalability, the Government should mandate that 50% of government and army computing must be off of Microsoft platforms within 3 years. Another way to say this is to suggest that 50% of the government and army computing initiatives should be on Open Source software and cloud based architectures within 3 years. Either or all of Amazon's Cloud, Google's Cloud or IBMs would be fine. This would make a statement. And, like our state-of-the-art computerized health care system, this will make us a bold global leader who can help change the planet's biggest challenge: healthcare costs and e-government. Based on everything I said above, this should be obvious but without a legal whip, I fear that typical government inertia will take the day.

In the comments below, I hope we will have a discussion on the role that mobile innovation could play in Israel and how it ties into cloud computing.

3. Agriculture

While on the subject of doing well while doing good, we actually do that already in one sphere: agriculture. We are a world leader in agricultural technology and desalinization in an era during which the world is concerned about how we will feed the world's population and where they will find water. As my friend Douglas Gayeton says, "Israelis are the world's best at making the most out of scant resources and this is the cornerstone of sustainability." We should make Israel the world center for sustainable agriculture and sustainability in general. We should re-fund the Volcani institute and the universities' agricultural faculties and make investing in food technology and water technology a national imperative and a national focus. This is awesome, important and will be a highly lucrative industry in the 21st century. This should not be a $10MM fund but a $500MM national commitment to retool world food production and water resources from Israel. As an aside, our core exports to one of the fastest growing economies in the world, Brazil, are agriculture technology and chemicals (many of which are also used in agriculture).

There are budding initiatives in the Sustainable Agriculture and organics space but we need to push the envelope both in technology and marketing and I think sustainable agtech and practices will make us a central linchpin in the 21st century global economy. This is doing well while doing good and we should lead in this sector. We are a healthy-living society relative to the rest of the world and before Mcdonalds spreads its wings much farther here, we should lead the world in better food and sustainability. We could export our knowhow to other countries and regions of the world which may also have a positive geopolitical impact for Israel.

To scale some of these initiatives we will need to aggressively recruit the best brains and management talent we can from anywhere in the world. Israel is one of the best places to live on earth. We have the greatest people and minds in the world in a tiny country with varied climate and a great outdoor lifestyle. As an Oleh from New York, I can tell you firsthand that it is a wonderful place to raise a family. We should not be apologetic in pitching the virtues and values of Israeli society and the quality of life people enjoy in Israel. If you are a night owl or beach-goer, come to Tel Aviv. Like the desert? Try Omer. Want to try your hand at ranching or savor the mountain views, the Galil is blossoming. Prefer something a little holier or family style, try Jerusalem. Something more American, English or French, try Bet Shemesh or Modiin and do not forget the lovely Caesarea. Everywhere you go in Israel, you meet people who are passionate and determined. The entrepreneurial spirit burns in the all the people here and you can feel it in the streets or on the beach. If we bring the best talent to Israel we will enhance our national competitiveness, our gene pool and our economy and we can do it.

While the world is reeling in economic crises, we have a unique opportunity to increase our national competitive advantage in technology given our reasonable economic stability. To paraphrase Warren Buffet, "When other countries are fearful, we should be greedy." Therefore, what is clear is that we need a focused government action to grease the wheels of innovation and jolt our tech economy into the next century. It must be strategically focused so we do not squander taxpayer money as the government has done for the last 10 years. It must be massive so it does the trick and it must be forward thinking so we do not miss the boat. Done right, it will open the spigots of private investment that will flow into the country like Project Better Place did and we will lead the world in building the 21st century's Capitalist Economy for the betterment of Israeli and Global society.

These are just some brief ideas and I hope you will add more below. This is a crowd-sourced document so please contribute.

EL Al Flights from Heaven!

2010-08-20T08:16:00.004+03:00

Pardon this interruption to the Humus Manifesto but I thought it important to call out why great service is great business. Don't be shocked but I want to tell you about one of my best service providers in a much maligned industry: El Al. After Michael Arrington's public flogging of Delta Airlines' service in his blog post "Delta Flight 1843 From Hell", I want to offer the opposite perspective on El Al. El Al's service is simply superb.

I just returned from two family trips this summer on El Al. It is not easy traveling with a family of 10 and El Al made it as easy as can be, if not better. They were accommodating to our baby and helpful with seating and luggage. The service on the plane to all of my kids (rowdy as they can be) was patient and smiling. The ground staff and security staff helped us through with all of our baggage (human and otherwise). Granted that I am a very frequent flier, but getting AMEX style service from your airline is unusual even for frequent fliers and El Al's frequent flier desk took really good care of us. Even when they lost one piece of our luggage (which happens), the return service was off the charts from the ground staff to the driver who loaded it into a car and met us in the middle of a road since we were not home (Arrington may want to try El Al :)!!)

The truth is, this has been true for a few years on my business trips. The plane crews and staff offer youthful exuberance, a great smile and terrific service. And the Frequent Flier treatment has improved greatly. However, family travel compelled me to write this because that is a lot tougher for us and for airlines, especially in the crowded summer months.

And, It turns out that great service is good for business too! El Al reported a 25% revenue increase and went into the black last quarter! Well deserved and thanks for the great service.

מי הם הדינוזאורים האמיתיים

2010-08-04T23:46:00.002+03:00

גיא גרימלנד כתב כתבה מצוינת היום בדה מרקר על מצב הסטארט אפים בתחום האינטרנט בכלל ובארץ בפרט. בכתבה הוא הזכיר את הפוסט שלי בבלוג "מניפסט החומוס" וכן בלוגים אחרים כמו של פרד ווילסון. העורכים כתבו כותרת מושכת על דינוזאורים שימותו טרם זמנם. לרגע חשבתי שהדינוזאורים שמתייחסים עליהם זה העיתונים כמו עיתון הארץ שלא מחברים לינקים החוצה מהכתבה לפוסטים..

Just sayin.....

The Hummus Manifesto - Part 2

2010-07-14T08:04:00.020+03:00

Thanks to everyone for your thoughtful comments and retweets on Part 1 of the Hummus Manifesto. I received notes from representatives of our government as well as a note from someone who said they showed it to the Governor of Oregon! Most importantly, entrepreneurs read it and they are the ones who make a difference and together we can all make a difference.

In Part 2, I want to focus on the role the government has played in fostering incremental technology advancement as opposed to disruptive innovation and how by ignoring the success of the past (or resting on laurels) we have let this wave of innovation and greatness pass us by. If that was not enough, in addition to stopping technology at customs in Ben Gurion airport, we have MKs who are actively shackling the tech industry while letting the Israeli Tycoons escape Knesset scrutiny, despite their grip on our economy (read my colleague Izhar Shay on this topic). Were it not for the great and talented young entrepreneurs in our country and incredible development teams at our startups, we would be in worse shape.

I wrote this piece almost two months ago and have edited it somewhat recently. But, the heart remains the same. Given the current battle between the Finance Minstry, Chief Scientist and the CEOs of ECI Telecom, Elbit etc, this post is a bit like throwing powder keg into an already tense situation but I think the point needs to be made.

The Chief Scientist has invested our tax money in an unfocused manner for over a decade and looming unemployment is the result.

The Lavi was a visionary project that spawned countless engineers with bleeding edge tech experience. The project failed but the technology economic engine that was created by government investment in bleeding edge innovation persisted. That is what happens when the government invests in deep research and very advanced technologies for the future. However, the last 10+ years of government investment has reactively sprayed our money around into companies with no hopes in the market (like the incubators) or they have plowed it into big companies in order to preserve jobs on projects that are not really financially viable.

When government bureaucrats, who have not been in the market for years, are asked to invest your tax shekels in technology, their vision and, hence, choices are limited. They either need massive strategic direction from the top/outside to make focused bets or they will react to proposals in a democratic manner. They have chosen the latter. Democratically spreading the wealth of investment shekels neither creates industries nor changes the trajectory of our national technology competitiveness. It simply sprays money ineffectively. But this is what the Chief Scientist's Office has done for much of the last 15 years. The end result is a pile of technology companies who did not receive VC funding and then get insufficient Chief Scientist funds to make a difference. Said differently, these technologies were rejected by the market but somehow the government decided to give it some of your taxpayer dollars, in insufficient amounts and with strings that make it harder to exit. This is backwards and it does not enhance our national technology competitiveness.

Then we have the Chief Scientist's investment in larger companies. Somehow Google is able to develop Android, Google TV, Google Apps etc. without an American Chief Scientist investment; struggling Apple (circa 2000) invented the iPod, iPhone, iTunes and iPad without Chief Scientist funding, but ECI can't develop a next gen product without it. Same for Tower Semiconductor. I don't get it. If it is a commercially viable opportunity or the next great market for your publicly traded company then go finance it from cash flow or raise equity. Why does it make sense for the taxpayer to fund public company projects that company management itself does not deem worthy of a balance sheet investment? And what are the odds that they will take that government money and spend it on disruptive innovation? It flies in the face of Clay Christensen's core thesis in the "Innovators Dilemma" that has been proven accurate time and again.

So we have the Chief Scientist investing dollars in projects that management deems unfinaceable basically in order to preserve jobs at larger companies like ECI, Alvarion, and Tower Semiconductor. This is the recipe for incremental technology improvement malaise that we are in now as an industry. It is a job preservation strategy rather than a job creation strategy. And job preservation strategies ultimately go awry and lead to the opposite, job destruction, when the music stops. That is what is beginning to happen right now.

Despite the Chief Scientist's current approach, or, more accurately, because of the Chief Scientist's approach, I fear we will see a situation where the companies of yesterday, many of whom are Chief Scientist grantees, will start laying off high tech employees in droves. Motorola Arad and Alvarion are but the first shoes to drop. Tadiran has been laying off employees and the overly large grantee in Migdal Emek called Tower Semiconductor has hardly paid for its taxpayer dollars. In start up nation, we could have many of yesterday's companies' engineers out of work, all with the help of government preservation incentives. It is astounding to think that despite what I describe as a dearth in tech talent, we would end up having thousands of tech employees laid off by these ossifying companies. This is not fair to these talented tech employees and it is not fair to our economy. They and we deserve better. In effect, the CEOs of these companies admitted as much last week when they warned of looming massive unemployment from their companies. I agree. It is coming if we do not do something dramatic.

Chief Scientist Eli Ofer took a step in the right direction with his Medical focus (reasonable people can argue about whether biotech is the right focus) but it is too small of an investment. The lion's share of taxpayer money still gets scattered in a non-strategic manner. And, it comes with too many strings attached. In fact, if you ask any venture capitalist, they will tell you that OCS money is a big negative in any investment. We advise our CEOs against taking the money from the Chief Scientist (for full disclosure, I have one company where OCS money pre-dates my board membership). A VC colleague and friend with inside knowledge told me that the Chief Scientist nearly killed the Dune acquisition. So the market actually selects out the better companies from taking Chief Scientist money and the Chief Scientist then invests taxpayer money in second tier companies with lower chances of returns. To be fair, there are cases in very capital intensive industries where this may not be true but I question whether those are areas the Chief Scientist should spray taxpayer shekels into.

My colleague at JVP, Erel Margalit is absolutely right in stating that it is outrageous to cut the OCS budget and instead we should be increasing it. In fact, we should massively increase government investment in improving our technological competitiveness. However, if we increase it and continue to use that money in a misguided manner, we might as well keep it in the taxpayer's pocket.

Again, The Ministry of Finance and Haim Shani gets this, which is why they are proposing the $100MM revenue test for Chief Scientist grants. However, former Chief Scientist Carmel Vernia, is also right that we should not be giving money to companies just because they are small. As I mention above, spraying the money to hopeless small companies is not a winning strategy either and is why the $100M revenue test is ultimately not the right filter. We need a new strategy for the Chief Scientist and/or maybe we need a new role (more on that in part 3).

We forgot the old playbook

The last wave of innovation was kicked off by attracting National Semiconductor, Microsoft, Intel and Motorola in their heyday. With the exception of Intel, these are not the new guard of growth companies and future technologies. Even as Motorola tries to right itself by charging into Android-supported smart phones, that is not what the Israeli arm is working on. Microsoft keeps coming...but it is not the growth engine it once was. And, it is downsizing. Israel has done little to attract this generation's growing companies such as Facebook, Amazon, Google and Salesforce.com. Even Broadcom and Google only have small outposts here. Companies like Facebook, Google, Salesforce etc. create entrepreneurial networks and spin out the next generation of startups and innovation, trained at the leading companies and armed with human networks to build a new company. When you are not part of that virtuous circle (which we are not), you miss the next wave of company creation. We forgot what worked in the past and did not work to attract these companies so we are missing the cycle.

And what have we done to attract the growing Chinese technology companies? Is anyone looking East? If we were R&D centers for great US companies in the past then why not Chinese companies in this decade? But, again, we have done little. (Calcalist reported that Huwaei is rumored to be operating here as Toga Networks but nothing is confirmed.) How did we forget this playbook to create training grounds for our best engineers inside tomorrow's growth companies and leading edge technologies? Who fell asleep at the Ministry of Industry and Trade?

Here is another example: Google offered communities to build ultra-speed broadband as a test. 1100 communities turned up. We have a whole country that is the size of an American community! Did we lobby Google to wire all of Israel with ultra-highspeed broadband. No! Could we have? Yes!

The ever-rising shekel (and it will rise more) makes us even less of a low cost provider. The truth is that we were never a low cost provider but now it is glaring on every CFO's budget projections so we need incentives to attract these new leading technology companies. It also means that we need to be a center of dramatic innovation. We need to make the coolest, most cutting edge, revolutionary,awe-inspiring productsfor the next century but we can't because our engineers are trained in the wrong technologies, our universities are under-funded, our post-docs go abroad and our talent is spread thin, our money is being sprayed around, we have not attracted new leading companies and we are under-investing in disruptive innovation. Oh, and the cutting edge technologies we smuggle in are stopped by Kahalon at Ben Gurion. What we have innovated is through the absolute genius of our Israeli entrepreneurs who beat all odds to do amazing things.

Investment capital is drying up
Many VCs (including ours) have come to the conclusion that Israel cannot support dedicated funds. We all want to continue investing in Israel and we continue to because the greatest entrepreneurs live here. However, Because of what I describe above, there are simply not enough opportunities to build companies of venture scale in Israel and fill out a regular-sized venture fund (for a slightly different perspective, see Yaniv Golan'sexcellent response to my post and his comment on feature companies). One of the senior VC reporters in Israel told me a few weeks ago that there is currently not a full time job in the field covering VCs. Correct. We are a country that over time will likely rightsize between $250MM - $500MM of total start up investment per year. If that scares you, it should. It should scare not only the technology industry but anyone who cares about jobs in Israel because the tech industry generates jobs in restaurants, office furniture, hospitality and many other areas of the economy and this will ripple through.

We have never had late stage capital and that is a big problem. Again, Haim Shani, the new CEO of the Finance Ministry has his sights on solving this problem that also causes companies to sell early but I am not sure he has a full view on the incentives or scope of the problem. The Prime Minister's Chief Economic Advisor Professor Eugene Kandell has been working on this for a year now and has made a number proposals. But his proposals were probably stopped at customs by Kahalon. He and his team at the National Economic Advisory Council are trying and are aware of the problem and I agree with them that we need more than one lever. Insurance to the local insurance funds is not enough. The local insurance companies and pension funds are at least honest enough to say that. Here again, we should remember the old playbook that Yozma delivered on so well. Ireland seems to have learned from it. We need to bring late stage expertise from abroad because we do not have it in Israel as best as I can tell. That requires a Yozma-like approach.

Well Michael, enough describing problems....try to be productive and make some suggestions. That will come in Part 3 of the Hummus Manifesto. This is a crowd-sourced document so please keep the comments coming so that the great people of Israel and the tech economy can bubble up the problems and bring forth the solutions that seem to be so elusive to "decision makers."

The Hummus Manifesto - Part 1

2010-07-12T09:52:00.004+03:00

This is the first in a multi-part series on the challenges facing the Israeli High Tech Industry and How We Can emerge stronger from both the global economic downtourn and the challenges facing our tech economy.

We are fortunate that the two leading players in Israel's budget discussion, Professor Eugene Kandel, Chairman of the Prime Minister's Council of Economic Advisors, and Haim Shani, Director General of the Ministry of Finance, are so focused on the challenges facing Israel's technology industry. However, lost in the debate about how to best jump start the liquidity issues in the high tech industry is a focus on the core root of the problem. As the budget topic is hot now, I would just weigh in and say that dealing with the liquidity issue is insufficient. The fix needs to come through massive investment and not through re-allocating budget. It is the only way to build critical mass and turn the ship. We need to change the way the government looks at and invests in technologies of the future. Oh, and one last thing, kicking the can down the street through insurance will not change the dynamic on the investment side. More on the pressing topic of the budget in a coming post but now on to the Hummus Manifesto Part One.

Part one - Tomorrow's Technology

I love what I do. I consider myself incredibly lucky to get up every morning and meet incredible entrepreneurs in Israel. I am inspired by the innovation and opportunity to create jobs. We are the start-up nation for a reason. Our national chutzpa gene is incredibly strong and our will to win against the odds is insuperable. As Dan Senor and Saul Singer point out in Start Up Nation, Israel has excelled at multidisciplinary technologies and entrepreneurship in a way that many countries have not. We have created an entrepreneurial climate that is second to none and we have an esprit de corps that is infectious. We have turned military technologists into our core national asset and aspired for greatness. Heck, even our government in the late 80s and 90s contributed to the growth of this industry from canceling the Lavi Fighter jet and freeing up hundreds of bleeding-edge engineers and then launching theYozma Program that kick-started venture capital. For me and many others like me in our great country, this is exhilarating.

However, all of these great attributes, are fast becoming irrelevant, as the world of technology is rapidly changing around us and we are not doing enough to address the challenges. We are in need of a wake up call, a call to arms to fundamentally retool our technology industry from the ground up. It has atrophied at all levels. Deep down, we all know this. However, it is tough to say and the implications may be painful but, without it, our industry is at risk and unemployment will follow. Here is why:

We have a dearth of talent
Huh? A dearth of talent? How could that be? Well, we have tons of smart people and tons of entrepreneurs. We have lots of engineers. However, many are misplaced, scattered and focused on the wrong technologies. Here is why:

Firstly, there are too many start ups in Israel. We are a small country whose plethora of large angels, individual investors and even VCs have seeded a ton of companies. In Israel, the two man start up is not a path to building the next Facebook but, rather it has become a path to a 5 person company who will try to sell its feature quickly. This is scattering our talent and preventing our more successful and growing startups from finding and hiring the talent they need in order to scale up to be big companies. The two man feature-startup creates unrealistic equity expectations, as these founders own 80% of their little companies (their angel owns 20% for a few hundred thousand bucks) and the founder asks himself "why would I go work at company X for 0.2% of equity when I own 80% of my own company"). This is a problem. Israel's great startup companies cannot find great talent to recruit in ways that Google and Facebook have recruited in Silicon Valley because too many great engineers are scattered in tiny start ups. Based on conversations I have had, Venture Capitalists in Silicon Valley have taken note of this.

Second, our talent is focused on the wrong technologies. I can't believe I am saying this but, as a country, we are developing yesterday's technologies or, more accurately, we are developing on yesterday's technologies. No internet-scale start up in Silicon Valley is developing on Dot-Net and C#. Yet, in the Zionist republic of Microsoft, all of our engineers are Dot-net addicts. The Israeli Army is a Microsoft colony.

This is what last week's New York Times has to say about today's engineers.

But the recent crops of computer science graduates and start-ups have tended to move far afield from Microsoft, Mr. O’Reilly said.
The vast majority of technology start-ups today rely on open-source software, distributed by Microsoft competitors, for the core parts of their technology infrastructure.
And so the technology-minded people coming out of college have started learning their craft on free software and betting their careers on non-Microsoft wares.
“We did not get access to kids as they were going through college,” acknowledged Bob Muglia, the president of Microsoft’s business software group, in an interview last year. “And then, when people, particularly younger people, wanted to build a start-up, and they were generally under-capitalized, the idea of buying Microsoft software was a really problematic idea for them.”
The loss of access to start-ups has already proved damaging to Microsoft as companies like Facebook and Twitter that rely on free software have grown from fledgling operations to Silicon Valley’s latest booming enterprises.

Don't worry Mr. Muglia, in Israel Microsoft smartly trains our soldiers in Army intelligence units on Microsoft technologies who then take the Dot-net gospel to the halls of government and start ups. In other countries, the universities like Stanford, MIT and Cambridge are the main source of engineers so you can just open different courses. But not here. Because of our unique structure of army-bred entrepreneurship, the technology decisions made in the Defense Ministry and in the halls of government, dramatically impact the expertise of our developers. The Government is responsible for this problem and since there is no tech visionary in the government nor Chief Investment Officer with a holistic view of opportunities and challenges, this mismanagement will continue. Director General of the Finance Ministry Haim Shani gets this, I think. I hope...

The Army-led structure is why we excel at wireless and it is why we are a Microsoft-beholden tech industry. And that is not good news in 2010 and is why Israel's tech industry is starting to mirror what Techcrunch has said: that Microsoft's ideas are not the future. Try asking Seeking Alpha (one of our companies) or Fiverr what it is like to recruit Ruby on Rails programmers in Israel. A nightmare. Our government is a Microsoft addict. This year they canceled the paltry 1M NIS budget to fund the open source office alternative translation to Hebrew. Nobody in the government computer department can even spell open source. They prefer the Bill Gates or Steve Balmer Photo-op rather than advancing technology. Ask Minister Micky Eitanwhat it is like to get an open source project done in the Government computer center, otherwise known as Redmond-East. Italian strikes and immense pressure not to let open source inside the government cathedral is what our elected minister got. The bureaucrats and politicians don't want to miss that photo-op!

How about scalability? well, since so many engineers are at two-person start ups that never scale, we have scant few folks who have ever scaled big data centers or large numbers of customers etc. in an online environment. When scale is the name of the game in cloud computing, Saas, internet and software development, we are a country of midgets. One of our companies, Conduit, needs to hire tens of internet engineers and is getting there because of their growth and size but it is not easy! It is a rate limiting factor on the scalability of a very high growth company and Conduit are the best at it in Israel. Facebook can hire at will in Silicon Valley but in Israel, we are talent constrained. Conduit's hiring success is very very hard work and it is the outlier and not the norm. Avishai Avrahami, CEO of Wix (another of our companies) told me "My business grows at over 10% a month but my competitors will catch me because I cannot find Java and Ruby on Rails talent in Israel. I cannot find any engineers with experience in scaling big data centers for many customers. I am willing to pay top wages but I cannot find the talent. I am flying to Russia to find or buy talent."

Thank God that the tax authorities did not drive the online gambling companies to Gibraltar or there would be almost no scalability experts around. Frankly, with the exception of the semiconductor industry, we are falling behind in cutting-edge engineering talent. And this should scare us. You see, the reason we have not created big companies here in the last 10 years is because of all of the big companies like Google, Facebook, Amazon, Salesforce, etc were built on non-Microsoft technologies and were built to scale massively and we are not in that game! My former partner and the best tech HR Person in Israel, Sigal Widman (Currently at Gemini) told me last week that she has pulled out half of her hair looking for a VP R&D for scaleable web and cloud companies. "There just simply is not enough talent in Israel for this role," said Sigal.

How bad is it? I met a few weeks ago with a senior engineer who left Google to start a company. He is Israeli. I asked him: Are you setting up R&D in Israel. He said flat out "no." I asked why and his retort is shocking but not surprising: "The talent for core scalability and software platform development does not exist in Israel. Too few C++ programmers and no experience in scaling internet apps. I can even find more in New York(!). They (Israeli engineers) can prototype stuff in VB and Dot-net but cannot build scalable internet apps. Franlky, even side projects are not worth doing in Israel any more because it is not cheaper." There you have it in a nutshell. We are going to miss this internet boat.

Our investment in Yesterday's technology is also what is making it diffculy for great people that were laid off by Alvarion and Motorola to get jobs in Israel (more on this in part 2).

Speaking of new technologies and next generation, ask yourself how come there were no Israeli companies or entrepreneurs with early apps on the iPad? Why were we not represented on those Apple ads for the iPad and its apps. It is because our Ministers and bureaucrats block advanced technologies at the border rather than welcoming them with open arms. Dear Minister Kahlon, here is a different idea for you: How about going to Apple and asking to buy 10,000 pre-release iPads. You could give them out to entrepreneurs so we can be first to market with iPhone apps and offer to be the first country on the planet to convert its educational curriculum to the iPad. Now that would be forward thinking and visionary. But you, dear Minister, are incapable of that and, our industry, the growth engine of the Israeli economy, is paying that price.

And, by the way, why the hell are there so many damn lawyers here? We need engineers and not lawyers. Why has the government not focused some attention on creating incentives for our smart young people to become engineers and not lawyers? I digress.

Coming Next - Part 2: Israeli Government and Private Sector Investment In Tech

*With Apologies to Brad Garlinghouse :) And thanks to Yaniv Golan.

HaRav Yehuda Amital - Yehi Zichro Baruch

2010-07-09T08:31:00.003+03:00

I sit now in Los Angeles with a heavy heart. One hour ago, I received news that Rav Amital, founder and Rosh Yeshiva of Yeshivat Har Etzion had passed away. For the last hour I have been withdrawn, struggling to deal with the loss of someone who made such an impact on my life and that of my family while also struggling with the reality that I will be unable to attend the funeral to mourn together with others who were so profoundly influenced by Rav Amital. My thoughts are somewhat messy but I felt a need to write at this late hour and to pen some of what I, thankfully, have said publicly and some of what I feel privately.

The hespedim (eulogies) in just a few hours will, I am sure, cover Rav Amital's broad sweeping knowledge of Torah, Halacha and Psak. I am certain some will touch on his non-consensus political views and his uber-sensitivity to preventing Chilul Hashem (desecration of God's name). Others will speak about his infectious personality, the singing he led, his humility and his remarkable ability to tolerate and, dare I say, foster, dissenting opinions in Yeshiva and outside. I still find it remarkable, 20 years after leaving the Yeshiva, that he took in Rav Lichtenstein as Co-Rosh Yeshiva and lived in amazing harmony for almost 40 years. I am unqualified to write about those topics so I want to share a few personal stories that, in my mind, tell the story of an uncommon man, whose innate common sense and wisdom, made him the perfect mentor and Rav for the common man.

The first story takes place in 1991, shortly after the end of the First Gulf War. Rav Amital was graciously answering questions from a gathering of about 25 students in the Yeshiva Auditorium. It was a relatively intimate gathering. Truthfully, even though it was my second year in the Yeshiva, I did not have much of a relationship with Rav Amital at the time (today, I am embarrassed that I wasted 18 months before getting to know Rav Amital). There were some standard Halachic (Jewish Law) questions asked and I decided to ask something a little different. I sheepishly raised my hand and asked Rav Amital, "Is there a bigger mitzva (commandment) to live in an unpopulated place in Eretz Yisrael (Israel) such as the Galil or the Negev, Yehuda and Shomron or does the same level of mitzva apply to someone who chooses to live in Tel Aviv or Jerusalem." The truth is that I had only cursorily contemplated making aliya at that time but Rav Amital's answer literally changed the course of my life. He answered in his characteristic charming bluntness, "That is all nonsense (שטויות), come to Israel and set up a factory that will employ 10,000 people who can then earn an honest and decent living and that will be the biggest mitzva of settling the land of all!"

I was shocked by the answer. For the first minute, I thought he did not answer or understand my question. Here was a Rabbi, a Rosh Yeshiva, giving counsel on business and economics as the foundation for settling the land. Then I rethought it and realized the deep wisdom. Man can only live on ideals for so long. Not that ideals are not important. They certainly are. But people need to eat and to work and earn a living so that they can settle the land and we can attract enough people to Israel to fill the land. It is absolutely the Jewish ethos for people to work and for others to provide work for them. At it was an out of the box an answer and unconventional thinking and it was inspiring. At that moment, I resolved to move to Israel and open a factory that would employ 10,000 people. And at that moment I resolved to spend more time getting to know and to listen to Rav Amital as well as to understand his unique common sense Torah wisdom.

The post-script to the story is that I was asked to tell it over at Rav Amital's 80th birthday. In characteristic wit, when I finished telling the story, Rav Amital asked "Nuuu...did you hire 10,000 people yet?" Embarrassingly, I had not and have not, but will redouble those efforts in his memory. I was hesitant to talk publicly about the story but the organizers insisted. However, in retrospect, I am glad that I had the opportunity to thank Rav Amital publicly. That hakarat hatov was another hallmark that Rav Amital imparted.

The second set of stories relates to my attempts to spend more time around Rav Amital. After making Aliya, I resolved, like many other talmidim (students), to go visit him on Purim and Sukkot and I routinely brought my children, who I would encourage to ask questions. On one Sukkot, after prodding one of my sons to ask Rav Amital a question that my son had asked me a day earlier, Rav Amital turned to me and said "leave him alone, let him eat the pretzels."

Again, the common wisdom. Having the kids enjoy themselves in Rav Amital's sukka was better chinuch (education) than pushing them to ask a question and feeling uncomfortable. On every Purim, with many talmidim in his house, he would invite the kids to come sit or stand near them and ask them questions about their costumes. Not what they learned in school and not the megilla but about their costumes. Rav Amital talked to the children about what they wanted and not what he or I wanted. That is a lesson I carry with me in rearing children. It also explained another situation that I once witnessed in yeshiva. Some children were making noise during one of Rav Amital's sichot (speeches) in the Yeshiva. The kids were located in the upstairs women's section and a number of the men downstairs kept shushing them. The kids' noise grew louder and the shushing grew louder until Rav Amital said strongly "I am not bothered by the children making noise. They are doing what they are supposed to do. But I am bothered by the adults turning around and making noise to quiet the children." As I said, common sense. But common sense is really in short supply these days.

The last story of many more I want to tell relates to something that happened just a few years ago. I was asked to join the board of the Yeshiva during a time when the financial situation was challenging. I was very intimidated to sit with Rav Amital and Rav Lichtenstein at these meetings. At one of my first meetings, I took a look at the budget and became worried. Even very worried. I voiced that concern with some level of trepidation. I noticed as I was speaking that Rav Amital cast a disapproving glance at me but was not sure why. After the meeting, he came over to me and said, "You think this is bad? I have seen worse situations and not just financial ones. We need to have emunah (belief) in the derech (way) and the educational framework because if we alter the product (the educational approach), we will not achieve the same results nor will we be true to ourselves." Wow! I thought. Rav Amital had seen worse. He had come through the holocaust, the War of Independence, the loss of students, the building of the biggest Hesder Yeshiva, a stint in politics etc and he was determined to maintain the quality and commitment. To me, this was a lesson in leadership from someone who had decades of perspective and was prepared to stand up for quality and perseverance in the face of pressure. And it was infectious. It was not that Rav Amital was blind to the financial issues but he understood עיקר וטפל. And he was prepared to lead forward. Common sense for common people from a very uncommon man.

I have so much more to say and many more stories. Maybe I will add more later to the blog in comments. Rav Amital was unique in everything he did from leading dancing at hakafot to ensuring succession in the Yeshiva while he was still alive, something that is unheard of in the yeshiva world. He made a tremendous kiddush hashem and blazed a trail in shalom bayit (peaceful relations) for hopefully many more institutions. He taught us all to inquisitively ask questions but, even more importantly, to also live with questions. The ability to live with questions in an era when everyone thinks every answer is at their fingertips in an instant is a life-skill none of his students will ever forget and they will be forever indebted to Rav Amital for endowing this approach.

And today, as Rav Amital is brought to burial in just a few hours, I am sure, we all have more questions than answers. We all have more questions that we would like to ask Rav Amital so that we common people can get common sense answers from a very uncommon man. I will sorely miss his wisdom. We all will.

Yehi Zchro Baruch

יהי זכרו ברוך

Hey Tom Friedman, Timeout!

2010-06-27T15:36:00.002+03:00

New York Times Op/ed columnist Tom Friedman today called on Israel, or, more accurately, Israeli Prime Minister Netanyahu to launch a diplomatic initiative or else "the risks to Israel’s legitimacy.....will be staggering."

Even though I have made clear that I think Israeli leaders and politicians need to take initiative (and they don't in any sphere) I never thought that launching diplomacy to minimize risks was a good strategy. We do need to take the initiative, even the offensive on the diplomatic sphere and stop getting dragged into reactions on the world's stage and timetable. However, Friedman's analysis and fear-mongering, by asserting non-truths promulgated most-famously by the Goldstone report and giving them credence in his column, is not doing truth, stability or "initiative" any favors.

Israel today is enjoying another timeout because it recently won three short wars — and then encountered one pleasant surprise. The first was a war to dismantle the corrupt Arafat regime. The second was the war started by Hezbollah in Lebanon and finished by a merciless pounding of Shiite towns and Beirut suburbs by the Israeli Air Force. The third was the war to crush the Hamas missile launchers in Gaza.
What is different about these three wars, though, is that Israel won them using what I call “Hama Rules” — which are no rules at all. “Hama Rules” are named after the Syrian town of Hama, where, in 1982, then-President Hafez el-Assad of Syria put down a Muslim fundamentalist uprising by shelling and then bulldozing their neighborhoods, killing more than 10,000 of his own people.
In Israel’s case, it found itself confronting enemies in Gaza and Lebanon armed with rockets, but nested among local civilians, and Israel chose to go after them without being deterred by the prospect of civilian casualties. As the Lebanese militia leader Bashir Gemayel was fond of saying — before he himself was blown up — “This is not Denmark here. And it is not Norway.”
The brutality of the Israeli retaliations bought this timeout with Hezbollah and Hamas, and the civilian casualties and troubling TV images bought Israel a U.N. investigation into alleged war crimes.

Brutality? Undeterred by civilian casualties? Come on Tom, you must be kidding. The Israeli army operated with a precision laser. If you want to see brutality, check Saddam Hussein's brutal killing of his own people or Ahmadinejad's repression of the latest civilian rebellion. I am sure you can find more examples. Israel's Gaza Operation was the most pinpoint war in the history of mankind and, because of that, unfortunately, it is one which did not have a decisive victor. The Lebanon war was not won because it was fought from the air and poorly planned by a rookie defense minister. Beacuse of that there is continued and even increasing tension on both of those borders with the UN unable to enforce resolution 1701 which ended the Second Lebanon War and Gaza still thrives on terror.

You see Tom, Israel is not in "Timeout" now. Rather, it is in limbo. It was in timeout after the 67 war because the victor was decisive. When you do not have decisive victories, we have wars or "low-level conflicts" that brew on for decades and ultimately boil over (Iraq, Afghanistan, Korea???). Frankly, the worst reason to engage is to minimize risks.

Israel does need to take the initiative, but we need to take it from strength and belief in our convictions that we are entitled to return to our homeland after 2000 years and live here in peace and prosperity. We should feel the strength of our conviction that firing 8000 rockets on Sderot is intolerable (not only during a Presidential election), that Israel is a force for innovation, morality and democracy in the Middle East and the World. And finally, we will do what is right to protect our sovereignty and act in the best interests of our citizens and not in the best interest of columnists who have never lived with Hamas as a neighbor.

Nassim Taleb Calls the Stock Market a Hoax

2010-05-17T09:55:00.002+03:00

I bumped into Black Swan author Nassim Taleb on my way into the CNBC interview I did last week. I am always fascinated by his commentary. This video clip from a Bloomberg interview I found on Seeking Alpha (Benchmark Company) is both provocative and a bit scary.

Talking Seeking Alpha, Gigya, Conduit, Social Media and Sustainable Ag

2010-05-13T01:34:00.003+03:00

Had a fun time today on CNBC talking up a range of portfolio companies with Erin Burnett on CNBC today. She is a great interviewer and really easy to converse with on air. Erin also brought up my passion about sustainable agriculture at the end of the segment.

The New Stanley Fischer Model of Central Bank Governors.

2010-05-10T15:56:00.002+03:00

As the markets this morning are flying higher from the "Shock and Awe" bailout plan from the ECB and the Eurozone, it is worth considering where this shock and awe came from and how it is changing market dynamics. For decades, we all considered the role of the central bank, the Fed and others to be a steady hand guiding fiscal policy and moderating the economy. Hence, we hung on the minute nuances of statements from Greenspan, Bernanke, Triche and others. They were careful with their words and even more measured in their actions. We had incremental moves in interest rates, hesitant and well-telegraphed intervention in markets and government debts and generally well-anticipated and expected policy decisions.

One man changed all of that over the last 24 months: Stanley Fischer, Governor of the Bank of Israel. The world looked on as Israel (and Australia) were first out of the recession, avoided bank failures and kept its currency relatively stable in the tornado of global currency fluctuations. The world looked on and learned. They watched what Fischer did and learned. And here was the conclusion: as markets turn more volatile and the world is more interconnected, the job of the Central Bank has changed. The Central Bank needs to keep markets guessing. It needs to create black swans (to borrow from Nassim Taleb) and needs to surprise the markets.

Fischer would unexpectedly intervene and buy dollars to keep the Israeli Shekel at a reasonable rate for exporters. He would buy government bonds if need be. Most importantly, he kept the markets guessing. It created a lot of one day volatility and frustrated traders but it engendered long term stability and let the economy have time to work itself out.

The ECB has now figured this out. Monday morning, they moved unpredictably. They created a huge bailout, "Shock and Awe in 3-d" as one trader said. They bought an unannounced amount of Greek bonds. People are guessing $3Bn - $5Bn but nobody knows. Traders guess it is in Greece, maybe spain, maybe Portugal, nobody knows. But it is a countervailing force to the huge drops driven by interconnected markets that create big drops in markets. The surprise intervention is helping the markets stabilize. "Surprise" is the new "stable." And, when history is written, one man's name will be on this new policy initiative, "Stanley Fischer." The ECB has learned and now maybe Bernanke can learn a thing or two from the old mentor.

One Country For Two People - My Column in Globes

2010-05-05T17:52:00.002+03:00

I wrote a column in Hebrew in Globes. This is the link to the full article. First paragraph below.

שנים שאני קם בבוקר וחושב לעצמי שמשהו פה בארץ דפוק. משהו לא עובד. שנים, 14 ליתר דיוק, שאני קם בבוקר עם שיר בלב. אני הולך לעוד יום עבודה שבו אפגוש את האנשים הכי מרתקים במדינת ישראל, אנשים שמחדשים ויוזמים ולא נרתעים מהאתגרים הכי גדולים בעולם העסקי והטכנולוגי. יוזמים ומחדשים ויוצרים את מציאות עולמם והעולם כולו מתל-אביב, מהרצליה ומיוקנעם. ישראלים שמנצחים את ההיסטוריה.

Greece is Nearby...Corruption and Economic Downfall Go Hand in Hand

2010-04-28T14:51:00.004+03:00

The corruption scandal rocking Israel now, has made spectacular headlines in the local press. The average Israeli, while repulsed and angered by the abuse of public trust implicit in the accusations, does not think that the corruption affects their pocket or the country's overall economy as a whole. The salient stain in their mind is the ugly monstrosity that hangs over Jerusalem's southern skyline, the HolyLand Complex, our own monument to corruption.

Dear Fellow Israelis: Think again and look across the Mediterranean. The lesson from Greece is clear: Corruption leads directly to sovereign economic downfall. Goldman Sachs is an easy scapegoat. Profligate government spending is irresponsible and bad economics. But, the root of the economic problems is the corruption that Greek Officials and politicians engaged in. Corruption erodes both the trust of investors and the stability of countries. Investor trust is obviously tied to stability and predictability of the rule of law and countries processes and procedures. When investors lose trust, countries cannot finance their debt or growth. Foreign investment dries up and impacts stability at all levels, even regular civilians.

This is why we must root out corruption in Israel, both perceived and actual. Governor of Bank of Israel Stanley Fischer is right to go after the "tycoons" who control approximately 50% of the economy in Israel, at least one of which, Dan Dankner, has been implicated in the corruption scandal. The government needs a persistent process and policy to attack corruption at every level of government. Dealing only with the HolyLand project is insufficient. We need to look at the causes of corruption as well. Long and complicated bureaucratic processes for building, land, privatization and licensing are breeding grounds for corruption. Leaving public officials and bureaucrats in their positions for a long time makes corruption enticing. Allowing public officials to parachute into the conglomerates controlled by "tycoons" begs for bad judgment and corruption. It confuses them as to who their master really is.

We need to address the core issues and not the symptoms. Corruption is corrosive both to national solidarity and to the health of the economy. It is a national issue and it is fundamental. We must not rest on the laurels of our healthy economy here in Israel. We must be vigilant to root out corruption. Greece is not that far from here.

At the Wailing Wall It Is Sometimes Hard To Tell Who Is Really in Costume on Purim

2010-03-06T21:38:00.004+02:00

Hat tip to our friend Idit for the photo.

For more current events on the fur Shtreimels, read this progressive law. With Unique coalitions in the government, exclusions are necessary.

Praying remotely: The iPhone really does do everything

2010-02-16T15:50:00.003+02:00

Today I tried out a cute application that was launched last night called jPray (screenshots below) by Jerusalem.com. With jPray (you can download here), you record a prayer and then the prayer is said over loudspeakers in Jerusalem. That is right, you speak the prayer into the iPhone as if it is a local call in Jerusalem, close to to the Temple Mount and Wailing Wall if you are Jewish, the Church of the Holy Seplichre if you are Christian and the Dome of the Rock if you are Muslim. You can then schedule delivery for now, evening or morning prayers.

The app, which costs $1.99, is cool and cute and I think religious people everywhere will like it. It lacks two features that I would like to see, post to your social network and a feedback loop where you can see a picture of the holy site at the time your prayer is said, or, alternatively, confirmation that they prayer was spoken in Jerusalem.

jPray (screen shots below) joins another prayer app focused on the Jewish world called Kotel Notes, by Shai Winniger. Kotel Notes goes the old-fashioned way. You scrawl a note into your iPhone and even though you are unable to physically place it in the Wailing Wall, Kotel Notes will print it out for you on paper and, in time-honored tradition, will have it inserted between the hallowed stones of the Wall.

Kotel Notes also lacks the feedback loop as one of the reviewers (Bostonjew123) comments: "Great idea but need to know it got tucked in the wall!"

All in all, these are good and cute apps that are worth getting if you can't get to Jerusalem and do the real thing. But nothing beats the feeling of the real thing.

href="http://2.bp.blogspot.com/_JQDO0yGqgXA/S3qnYJbd1FI/AAAAAAAAAZc/7FNmvcGWUps/s1600-h/Screen+shot+2010-02-16+at+4.08.32+PM.png">

Gigya. If you are not plugging in Social Infrastructure to your website, you will lose. As Gigya likes to say "Gigya Socialize is the new SEO."

LiveU Broadcasts...er...narowcasts my nephews' bris

2010-01-20T09:05:00.003+02:00

My sister and brother-in-law made a bris this morning on their twin sons in Jerusalem. 3 of us siblings are in the US and were pretty bummed at missing the momentous occasion. Cousin JJ volunteered a beta unit from LiveU to live stream the bris up to an internet link where we could watch it. So, my sister in NYC, my sister and I in LA cozied up to the laptop to watch live.

The broadcast is not without glitches as it cuts out every once in a while and the photographer was a bit late so we missed the first bris (good thing there was a second one) but the experience was absolutely magical. Seeing the bris and our family live from a living room in LA (no CNN necessary) was amazing and really brought the family closer together for this wonderful occasion.

A few tips if you want to do this in the future:

1. LiveU works by multiplexing multiple cellular uplinks. Therefore, make your bris outside where cell reception is better. Alternatively, bring your own picocell along with the LiveU unit.

2. Make sure your cameraman has a steady hand as the camera does not have VR.

3. Have a blackberry handy so that you can email and text the cameraman to move to a better angle

4. Sit back and enjoy the family moment. It beats the satellite video phones CNN uses and is much more personal.

ISRAEL' DISPROPORTIONATE RESPONSE. Amen

2010-01-19T04:35:00.001+02:00

Dear Judge Goldstone, Prime Minister Erduan of Turkey and Delegates to the UN

This came to my inbox today from Marcia and Dov. Nuf Ced.

ISRAEL' DISPROPORTIONATE RESPONSE

Many countries and world leaders have accused Israel of responding disproportionately to aggression from Hizballah inLebanon and Hamas in Gaza.

However, it is time that the world press and media speak of another disproportionate response from Israel.

The terrible disastrous earthquake in Haiti has generated responses from many nations. The US has sent supplies and personnel, Britain sent 64 firemen and 8 volunteers, France sent troops for Search and Rescue. Many large and wealthy nations of the world sent money. The Arab and Moslem world nothing.

Israel, a nation of 7.5 million people has sent a team of 220 people that include Medical personnel and has established the largest field hospital in Haiti, treating up to 5000 people a day, an experienced Search and Rescue team and medical supplies. As in previous earthquake disasters, such as in Gujarat India in 2001 and in Turkey, in the bombings in Kenya, Israel has been one of the most generous givers of aid and assistance

Turkey seems to have forgotten this help as its extreme Moslem Government is cozying up to Iran.

Judge Goldstone, where are you now? Eating your heart out and hanging your head down in shame I hope.

The favorite occupation in the UN is Israel bashing. More resolutions have been passed condemning Israel rather than all the so called democratic nations such as Sudan, China, Russia and others for their crimes against their minorities.

I think it is time that the world should know about Israel's disproportionate response.

Please forward this to as many people as you can.

Six Kids and a Full Time Job

Tom Friedman: Foolish Consistency Is the Hobgoblin of Little Minds

מניפסט החומוס פרק 2א! הגיע הזמן שהמדען הראשי יחשוב בצורה חדשה וחדשנית

Hey Sean Parker: We Are Only 7 Million People and Little Start Ups Are Draining Talent in Israel Too!

ככה אי אפשר לנהל מדינה

Corbin Hill Farm & Farmigo: Doing Well While Doing Good

Hummus Manifesto Part 4 - It's Amazon Stupid!

Nachas and Generational Continuity

Having More Children is Good for the Economy

From Rothschild to the Kotel: A Tisha B'av of Unity: משדרות רוטשילד לכותל, תשעה באב של אחדות

Alignment of Interests Requires New and Different Metrics

The Israeli Government's Ugliest Website, אתר הכי מכוער של ממשלת ישראל

Fix Political Leadership With A Constitutional Amendment for Longer Terms and No Reelection

Why Israeli Start Ups Should Be Paying Attention To the US Debt Discussion

Helping My Daughter Help Ethiopian Immigrants...an Update

Dearth of Engineering Talent in Israel

הגיע הזמן! משרד האוצר מדרבן חדשנות

Social Balkanization

We Have Enough Lawyers!

An Open Letter To Zeev Holtzman - The Sky Is Not Falling in Israel. It Is Getting Brighter

The Euro in the Eye of Stanley Fischer

President Obama's Speech on the Middle East - A Non Event

What Disruption Looks Like!

Real Measurement: Quantcast V. Alexa V. Compete.com

How We Get Our Data

Direct Measurement

Sharing Alpha

Look Out Below! The Dollar is Falling! What Now? Get Awesome!

Look Out Below! The Dollar is Falling! What Now? Get Awesome!

An Open Letter to Employees of Snaptu: Please Stay In Israel!

Don't Forget Egypt

Come on Tom!!!

Saving a Life of a Special Woman Who Saved Many Lives

Celebrating The Obvious AND the Unsung Heroes of the Answers.com and MobileAccess Acquisitions

Whose Side is Obama on Anyway?

Start up Nation: Army Exemptions for Who?

Restarting the Start Up Nation

All Betters: A Review of Umair Haque's "New Capitalist Manifesto"

Will The Press and the Politicians Kill Israel's Economic Stability?

The New Wall Street Town Hall

Stats Vs. Soul

Kids...Go Horse Around Under The Table

Limassol, The Internet Capitol of Israel

Great Hi Tech Businesses Like Conduit Also Create a Better Society

Conduit: Financial Analyst Position in the Bay Area

Great Job Opportunity in Israel: Seeking Alpha is Looking for a VP of Finance

The Hummus Manifesto - Part 3

EL Al Flights from Heaven!

מי הם הדינוזאורים האמיתיים

The Hummus Manifesto - Part 2

The Hummus Manifesto - Part 1

HaRav Yehuda Amital - Yehi Zichro Baruch

Hey Tom Friedman, Timeout!

Nassim Taleb Calls the Stock Market a Hoax

Talking Seeking Alpha, Gigya, Conduit, Social Media and Sustainable Ag

The New Stanley Fischer Model of Central Bank Governors.

One Country For Two People - My Column in Globes

Greece is Nearby...Corruption and Economic Downfall Go Hand in Hand

At the Wailing Wall It Is Sometimes Hard To Tell Who Is Really in Costume on Purim

Praying remotely: The iPhone really does do everything

Social is the Next Search

LiveU Broadcasts...er...narowcasts my nephews' bris

ISRAEL' DISPROPORTIONATE RESPONSE. Amen