Tel Aviv Becoming R&D Hub For Corporate Giants

The number of international R&D centers in Tel Aviv has doubled over the past five years, according to a recent report by Tel Aviv Global.

The number of International R&D centers in Tel Aviv has doubled over the past five years, according to a recent report by Tel Aviv Global based on data from IVC Research. From 35 R&D centers in 2012, Tel Aviv is now home to 73 centers, one fifth of all R&D centers in Israel. Employing more than 6,200 people, these 73 international R&D centers introduce new capital and knowledge to the city’s well developed tech ecosystem, and further elevate its global standing.

Tel Aviv
Tel Aviv, Israel. (Credit: Medioimages/Photodisc)

International credit card and fintech giant Visa recently decided to establish an R&D center in Tel Aviv, joining Renault, Bosch, MasterCard, Google, Facebook, Amazon, Coca Cola, Microsoft, AOL, Samsung, Siemens, Paypal, Deutsche Telekom, Citibank, Intel, Yahoo, Barclays, IBM, Apple and other multinational companies.

The Tel Aviv ecosystem is considered a leader in the nurturing of entrepreneurial spirit and is home to a large amount of startups, collaborative workspaces and acceleration programs creating an attractive environment for international venture capital firms and R&D centers.

The Tel Aviv Global report also addressed the growth of the high-tech sector in the city: Tel Aviv is home to 2,000 high tech companies which constitute about a quarter of the total high tech companies in Israel. These tech companies influence the local workforce, as 1 out of every 10 jobs in the city is in the high-tech sector.

There’s also been a shift in the Tel Aviv startup ecosystem: The rate of seed-stage companies has gone down and the rate of R&D-stage companies has gone up, in accordance with the overall trend in Israel. This shift in the composition of startups is evidence of a maturation of startups in the city and their progression from idea stage to a process of research and development.

The city’s global economic development unit, Tel Aviv Global, plans to focus on attracting even more big names to the city in 2018. A new municipal policy offers city-tax breaks and a “red carpet” package which helps entrepreneurs in all aspects of setting up international activity in the city.

“Our startup community has gained global recognition, and thanks to it, Tel Aviv-Yafo is recognized as one of the most attractive cities for technological development,” said Ron Huldai, Mayor of Tel Aviv-Yafo. “The municipality invests major efforts to promote our creative ecosystem with incentives that are meant to encourage our startup community and signal how important it is in our eyes to Tel Aviv’s economy, its global positioning, and most importantly—the energetic spirit of its people.”

“We understand that for our high-tech sector to grow, it must open the market to foreign talent,” said Eytan Schwartz, CEO of Tel Aviv Global. “Tel Aviv Global is working with our governmental partners on continuing the process of attracting international R&D centers, opening international accelerators, encouraging foreign entrepreneurs to work in the city, and promoting the activity of global corporations with an emphasis on Chinese companies.”