The relationship between high technology and real estate – opinion

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The high-tech market is growing rapidly, leading to higher wages. At the same time, journalists and other critics have accused Hi-techhigh salaries and exits to the rise in prices for real estate in Israel.

So what’s the truth and what’s the problem? Today Israeli tech companies are listed on the stock exchange more often than ever, and the truth is that this is to be expected. Back in 2013, when we founded Aleph, our venture capital fund, we told international investors that Israel was moving from Start-Up Nation to Scale-Up Nation and that billions of dollars worth of companies would not be uncommon in Israel. Israel today has a technological infrastructure, a vast pool of forward-looking leadership and, most importantly, iconic companies such as Wix and CheckPoint that set an example and motivate the younger generation to strive for excellence.

As markets boom, wages and living standards rise. real estate Prices. The problem is that although Israeli high technology is a completely free market, the housing market is dominated by state and local authorities and they are not doing their job. It takes less time to launch, develop and popularize a startup than obtaining a building permit in Israel.

The rapidly growing high-tech market in Israel is creating multinational companies that provide knowledge, investment and many quality jobs that inspire national pride and contribute heavily to Israeli taxes (25% of total national tax revenues). But there has been a wide gap between profits and the huge success of high technology and the collapse of the housing market and the regulators that powerlessly dominate it. There is a shortage of housing because of this, and every time someone buys an apartment as an investment, it is an implicit long-term bet on the continuing incompetence of building and planning advice.

In addition, the Israeli high-tech market is hungry for workers and creative minds. CEOs, developers, salespeople, and marketers alike invest time and money in training more people for the tech market, filling these high-paying and respected positions. But here, too, the market is failing because the government is not investing enough in teaching high-tech skills in elementary schools, high schools, and even universities. As a result, there is a shortage of study and students with lifelong skills in exact sciences, computer science, or even basic programming. On the other hand, the demand for such workers continues to grow – and the price, that is, the salary that employers are willing to pay, is growing rapidly, again, insufficient supply leads to higher prices.

So what can we do?

First, we all have a civic duty to lend a helping hand and teach people to program or empower them to master 21st century skills. If each employee in the high-tech market takes on the training of four people, if we invest our money and our efforts in raising a young and qualified generation from all walks of life, the market will grow even more, and we will all benefit, both personally and and nationwide.

Secondly, the state should require programming lessons in every elementary school. They should be part of the mainstream curriculum and there is no reason why they should not be taught in both religious and secular public schools, as well as in Haredi society and the Arab sector. This will help fill gaps, promote a healthy economy, and enable people to earn honest and dignified lives.

Thirdly, the state should encourage employers to train workers directly at the workplace. Employers know best what the market needs and how to train workers accordingly. If the state rewards them for this, not only will there be many more skilled workers, but we will all benefit. We’ll grow the pie and stop fighting for the size of the slice. We also need to make sure that companies can quickly and easily bring immigrants and other professionals with engineering talent to Israel.

On the housing market, as I wrote earlier, the government must immediately provide incentives that will push the authorities to issue building permits within four months. If this is not possible, they should nationalize building permits or allow citizens to issue them on their own, provided that they are legally responsible for mistakes and failures. Cities should build and re-zonate high-rise buildings near transport arteries and train stations so that parking spaces are no longer needed. All this must be done with the aim of drastically reducing housing prices.

In this context, I suggest you read on the Internet (lnkd.in/dnJ7R2m) about Machshava Tova, who works with all walks of life to educate the future generation of Israeli high technology. And this, truly and without exaggeration, is for the glory of the State of Israel and a source of national pride!

The writer is a businessman, a venture capitalist in the Israeli and American high-tech industries, and a managing partner of the Aleph venture fund. He is an early investor in WeWork and many other companies including Wix and Gigya. In 2017, he was included in the Forbes list of 25 Most Successful Venture Capitalists in Midas Europe. He is also the founder of the Machshava Tova Association’s Startupistim program.



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