LOCATION: Intercontinental Hotel
, Park Lane
DATE: March 26, 2012
EVENT HASHTAG: #InnovateIsrael
Innovate Israel was ground-breaking in its attempt to directly connect the very best of British and Israeli technologists and fuse their skills and knowledge to build disruptive and fast-growing start-ups.
Organised by UK Israel Business
, the Trade & Economic Office
and the Israel Export Institute
, the event featured a wide-range of very special guests, including HE Matthew Gould MBE, British Ambassador to Israel, Israeli Minister Shalom Simhon, and Minister for Culture, Communication and Creative Industries Ed Vaizey.
With the Israeli’s tech sector highly respected throughout the world, and an increasingly varied technology presence throughout the UK, including in Cambridge and Silicon Roundabout, the event was designed to act as a bridge to align the two countries in the pursuit of the next groundbreaking technology company.
The day was very full, featuring in-depth panel discussions with industry leaders, along with discussions and spotlights on Israeli tech companies currently in the growth stage. In between the main discussions, 1-2-1 sessions were held that allowed representatives of UK tech companies to connect directly with Israeli counterparts, with the hope of fostering links and new business opportunities.
inspiresme were in attendance at the main discussions; there were some very astute observations from industry experts.
Content creation and curation
What is the future of content creation?
Rene: Peer-to-peer platforms are synonymous with new media – companies must find ways to connect with customers in this space. Customers will increasingly take control and decide what is important/what they want to be seeing.
Dov: Content types will increasingly merge – video with books, merchandise with games – and companies must find ways to package and monetise these convergences.
Businesses must make use of new delivery methods [e.g. second screens] to succeed [at engaging customers]
Rene: if you can aggregate peer-to-peer content with brand protection, advertising-safe, you’ll make a lot of money. But everything has to work on all platforms, at all times, on demand – this is no longer negotiable.
Jenny: more and more people will use second screens, mobile phones – businesses must make use of these new delivery methods to engage the customers. Making use of emerging technologies is fundamental to success in the future.
Rene: user-generated content and professional content will converge. We are already seeing this, for example, with the Huffington Post
– professional journalists write content, but consumers contribute too, blurring the lines. And the more popular post will be on the front page, even if it’s from the consumer – consumers are being respected.
Where do brands fit in?
brands and authority resonate with audience, but they are also interested in user-generated content. Finding a balance between the two - a sweet spot - is essential.
Generation Y don’t trust advertisers or lawyers – but they trust peer groups – family and friends raise awareness. Advertising has no effect any more. But brands have a huge future; they must engage with consumers. Generation Y engage with brands but not brands that advertise to them. They must add value.
Disrupting financial services
True business disruption often happens from outside - these new companies can "see the industry for what it really is." In the case of financial services, the big companies had forgotten about making customers happy.
At Wonga.com our inspiration is combining technology and data to rebuild the financial services industry and create scale. The future of financial services is two-fold - you'll have the big financial institutions, and then you'll have an application layer on which companies can build applications - this will be where the real innovation occurs.
The best businesses displace obvious inefficiencies
We really want to push boundaries in terms of solving problems - our biggest innovation is a focus on transparency, a direct, open and clear culture that we want to permeate the entire company.
When building something that streamlines a process, in our case accepting or rejecting applications for credit, there are big technical challenges. Estimating a potential customer's propensity to repay, something that's done by computers on a large scale, is very difficult.
We have seen a lot of opposition - it's not very popular to be in financial services post-credit crunch. We aren't here to replace the financial services market; even with new companies in place you need structural policies that enable traditional institutions to open up and lend confidently.
What do you like about Israeli entrepreneurs?
- They think big
- Always pushing the boundaries and looking for disruptive technologies
- Resourcefulness – doing more with less, constantly juggling responsibilities every day
What advice would you give to new businesses, and those seeking investment?
Focus on a big market and be able to scale if you are successful - focusing on a niche is not always the best idea as you'll hit a natural glass ceiling
With regard to pitching to investors, early stage businesses need to take a five or 10 year view – it’s about building relationships, and being clear and transparent – it’s NOT a transaction.
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TV of the Future
Guy: – content will always be king. Free content, because it’s so expensive, will remain in the hands of big players (e.g. major football tournaments). Large companies will bid and pay a lot for this content. Less expensive content will have a place on digital platforms, and this is where the main innovation will occur.
the future of TV is now. Supply and demand has changed massively in the last few years. Whereas before broadcasters and content deliverers would need consent from consumers, now they are already opted-in. People are multi-tasking, using mobiles while they are watching TV, and yet they are more engaged with content that ever.
Guy: there's going to be increasing blurring between between traditional and new companies e.g. Netflix
started as DVD postal services then expanded into instant, on-demand services
Jonathan: while the expansion into digital platforms suggests a more globalised network of content delivery, consumers will always demand localized content e.g different programme formats, cultural content and channels. Consumer will have the final say in what is best to get from the broadcaster – and what is best to get from content deliverer
Kobi: consumers are watching more and more TV, and there has been an increase in the number of subscription-based models. In the next few years, disruptive technologies are likely to enter the market, including new ways to distribute content, but the key point is that the market is going to grow, which completely defies commentators heralding the 'death of TV.'
Jonathan: most concerning for new media departments is the size of the pie, and their biggest challenge is proving how platforms synergize. Older companies need to use enabling technologies to maintain their market share.
Guy: the online TV distribution market is already based on a price-point and it revolves around content delivery networks and bandwidth. The large, established players buy enormous amounts of bandwidth at very low costs; new players buy much less bandwidth, and it's far more expensive. This acts as a barrier to entry. [in response to audience question on whether a move away from net neutrality
will change the industry]
Top reasons to invest in Israeli technology companies
Zahal: over 300 multinationals have R&D centres in Israel - it really is a true hub for disruptive innovation. If you want to invest in a company there, they must have a great team - that is the biggest priority. They should also address a huge market, and be doing something disruptive, whether that's technology or the business model.
Frank: Israel is an exciting platform for innovation, and the way companies are being run is shifting. The inventors are now running the companies, rather than inventing the product and then leaving the business to the 'traditional' managers, who didn't understand the product. Israeli companies are very skilled at taking an idea and turning it into a useful product.
The inventors are now running the companies, rather than inventing the product and then leaving the business to the 'traditional' managers.
Adam: Israel offers a unique environment, putting out technologies that are truly disruptive. The infrastructure is also there for supporting early-stage companies, which helps them get the initial traction they need to succeed. There's also a lot of co-operation with investors - the important stuff comes to the surface, so you don't need to dig hard for pertinent information.
Yahal: the human factor is also very important; there are some great people in Israel. The military-style development units are impressive. They teach responsibility, discipline and leads to maturity, which is obviously important to a successful start-up.
Debu: In terms of raw talent and products, Israel is on the pedestal. There are some great products coming out of Israel. There are also a couple of challenges, one of which is the negotiation cycle; some "simple" things in the West can take longer in Israel, and I think some companies there also look at monetisation a little early.