According to CNN, there’s an interesting business trend happening in New York City — about 10 new Israeli startups are joining the community each month.
This has been a recent trend. In 2013, When Guy Franklin began working at Israel Mapped in NY, there were approximately 60 such startups in the city. Now, there are about 200, and the trend shows no signs of slowing down.
Israel has a reputation for being a startup friendly nation. In fact, it has the highest density of tech startups out of any country in the world. Behind the U.S. and China, Israel has the third largest number of listed companies on the Nasdeq exchange. It’s no surprise, then, that there are a lot of startups migrating out of Israel as they continue to grow — but why are they coming to New York?
There’s a slew of advantages that Israeli businesses can access by moving to the city. Not only are there more customers — Israel has a relatively small pool of consumers, making the country reliant on foreign investors — but there is easier access to advisers, capital, and a better time difference with Israel than if the companies move to California. According to Nili Shalev, the economic minister of North America for the Government of Israel Economic Mission, having an office in the U.S. is “part of the evolution” of Israeli companies these days.
The number of startups has also increased thanks to a more stable market. The stock market began rallying back in 2009 and has since made steady gains.
Although NYC has been a popular move location for many of these companies so far, there is more and more friction associated with the move — “The ability for startups to move from Tel-Aviv to New York and to successfully expand is becoming harder and harder,” explains Eyal Bino, who runs an investor network that helps foreign tech startups find funding in the city. Out of the 58 startups Bino has worked with in the past several years, 23 have been Israeli.