As the business sector in Israel continues to boom, an increasing number if Israeli companies are looking to New York City to take advantage of the financial and market opportunities that the city has to offer. Israeli companies have experienced such growth that the true sign of sucess is no longer being acquired by an American company, but successfully competing head-to-head against them - and to do that, it is important to establish a presence in New York City.
There are many reasons for Israeli companies to come to New York.
First, easy access to the 320 million consumers in the U.S. market is essential for Israeli companies with global ambitions, and New York is the most convenient location for a U.S. affiliate that can serve as a gateway to this market. Access to the U.S. market is particularly important for Israeli entrepeneurs who are focused on building their companies into global leaders rather than seeking an early exit, and the early returns on this "build to hold" strategy are promising: the Harvard Business Review recently analyzed 112 Israeli companies established between 1996 and 2013 and found that many have become global market leaders.
Second, New York's status as a world financial center gives Israeli companies with a presence in the city unparalleled access to capital sources large and small - everything from angel investors and venture capital funds to NASDAQ and NYSE IPOs. According to the 2015 Compass Global Startup Ecosystem Ranking, New York City provides one of the strongest ecosystems for start-ups and has the second largest amount of aggregate venture capital investment in the world.
Access to the U.S. market is particularly important for Israeli entrepeneurs who are fucused on building their companies into global leaders rather than seeking an early exit
Third, New York City has created excellent incentives to attract and nurture early stage companies, particularly Israeli companies. START-UP NY, for example, offers new and expanding businesses the opportunity to operate tax-free for 10 years if they become affiliated with a New York university. ICONYC Labs in Manhattan is a program devoted exclusively to supporting the efforts of accelerators and early stage Israeli companies. Israeli StartUps NYC is the largest active Israeli-American tech community in New York focused on building relationships between Silicon Alley and the Start-Ip Nation. In addition, New York City offers a myriad of other programs designed to help global entrepeneurs and businesses from around the world leverage New York City's resources and economic opportunities, such as NYCEDC, which assists international companies in finding affordable workspaces, developing customized solutions to help businesses grow in a variety of sectors, identifying financing programs, providing mentors and helping new businesses measure and improve their business practices among many other services.
New York City also provides an excellent environment for the next phase in a company's life, and the cultural differences between New York and Tel Aviv nicely complement each other. New York, more than any other U.S. city, offers an easy and embracing environment for Israeli companies to assimilate and thrive. And New York is home to the largest Jewish community outside of Israel.
Moreover, getting to New York from Israel by a direct flight in 8 hours is far easier than getting to the West Coast (which takes 20 hours and often entails a stop-over). In addition the smaller time difference between Israel and the East Coast versus the West makes communications with Israeli headquarters easier to manage.
An ever-increasing number of Israeli companies seem to agree: as of 2015, New York City was home to over 268 Israeli startups, and this figure continues to grow at a pace of 10 new companies a month.
In terms of product testing and launch, New York City is the perfect market because it is widely considered to be the world's economic epicenter. The market reach is the strongest in the world, and the GDP of the city is US$1.5 trillion. Thus New York is the ideal location to test and market a new product.
An ever-increasing number of Israeli companies seem to agree: as of 2015, New York CIty was home to over 268 Israeli startups, and this figure continues to grow at a pace of 10 new companies a month.
By the same token, working in a new country presents some hurdles. To Israelis, the U.S. legal framework can sem puzzling with our vast body of corporate law, significant differences in privacy law, and highly litigious culture. A business wishing to register a new firm to do business in the U.S. will face some bureaucratic and legal hurdles, including reserving a name, obtaiing a federal identification number, registering to collect sales tax, arranging for workers compensation insurance, organizing the company and documenting the same, among many other things. But none of these things should be daunting with the right mentors and legal counsel. Israeli companies new to the U.S. legal market also need to be aware of the differences in billing rates and the high cost of legal services, but insiting on transparency in billing and requesting budgets prior to engaging a law firm will go a long way toward avoiding - or at least reducing - culture shock.