Michigan’s revived auto and defense industries have a new, if improbable, ally: Israel and its reputation for innovation and technical acumen.
That’s why Mark Davidoff, Michigan managing partner for Deloitte LLP, is helping to lead formation of the Michigan-Israel Business Accelerator. It’s time — time to strengthen business ties between the hometown auto industry and Israel’s expertise in self-driving vehicle technologies, among other sectors.
It’s also time to capitalize on Gov. Rick Snyder’s cultivation of the bilateral relationship. He’s led two trade missions to Israel as governor, addressed its annual CyberTech conference early this year in Tel Aviv and enthusiastically endorsed creation of the Michigan-Israel Business Accelerator.
“The iron’s been hot for awhile, and it’s going to get hotter,” Davidoff said in an interview this week. “We’re trying to move Michigan forward by deepening the connections between Michigan and Israel. The speed of innovation in Israel speaks for itself.”
He’s right, and hot doesn’t begin to describe it. Intel Corp. this year spent $15.3 billion to acquire Israel’s Mobileye NV, an automotive visioning company whose technology is embedded in both semi-autonomous and self-driving systems.
General Motors Co. operates an Advanced Technical Center in Herzliya, north of Tel Aviv, under Director Gil Golan. Its expanding engineering and technical staffs focus on next-generation automotive technologies with applications for self-driving vehicles and mobility services – expertise rival automakers also are seeking across Israel.
Creation of what’s being called the MIBA comes as mega-forces in the technology and automotive spaces, Silicon Valley and Detroit, are coalescing. They’re bringing Michigan’s defining industries closer to the often-iconoclastic skills embedded in Israeli business, much of it originally developed for its own national defense applications.
Emerging Israeli expertise in advanced manufacturing, automotive, mobility software, life sciences, cyber-security, water and agriculture are natural partners for Michigan companies. And those same sectors in Michigan’s economy offer Israeli companies a would-be landing spot in the crucial U.S. market.
“There’s a rich pool of ideas that feed well into the market ... and relationships here in the state of Michigan,” Jeff Mason, CEO of the Michigan Economic Development Corp. and an MIBA board member, said in an interview. “Israel and the Palo Alto West Coast we see at the state level in this mobility space. Shame on us if we don’t take advantage of the opportunity right now.”
Exactly right. A background paper on the Business Accelerator says it would “function as the central repository of information” of “all points of economic and business connection between Michigan and Israel.” It would lead missions to Israel to bolster strategic connections between business leaders, and function as Michigan’s “face” there.
A dozen Israeli companies already operate inside Michigan, according to data compiled by the MEDC. They range from auto parts and semiconductor parts manufacturing to software publishing and technical consulting services.
The goal of the new business accelerator, whose newly constituted, 12-member board met Tuesday? Expand the transatlantic relationship, and use its relocation to offices in a revitalizing Detroit to woo investment, even startup companies, eager for an association with that “Start-Up Nation” called Israel.
The MIBA will be a public-private partnership funded by state dollars funneled through the MEDC, as well as foundations, corporations and individual donors. Board members include former Detroit Economic Club CEO Beth Chappell; Matt Elliott, Michigan market leader for Bank of America Merrill Lynch; Birgit Klohs, CEO of The Right Place Inc.; Darin McKeever, CEO of the William Davidson Foundation; and Evan Weiner, CEO of Edward C. Levy Co.
“We’re going to be more of an incubator in Detroit,” said Beth Gotthelf, a partner as Butzel Long and president of the Michigan-Israel Business Bridge. That organization will be absorbed into the Business Accelerator, and several of its board members — including Gotthelf, the board president — will join the new board.
The MIBA is an multi-pronged effort to leverage common business interests and build on enthusiasm created by a series of business missions to Israel arranged and led by Davidoff. The lead-off “CEO Mission” in November 2015, which I joined and chronicled in a series of columns, became a template followed by missions of chief information officers and, later, leaders of cultural and social groups.
Many of those leaders have become de facto ambassadors for Michigan business in Israel and Israeli business in Michigan. Why? Because they had the courage and the wisdom to look beyond the two-dimensional (if often too real) caricature of Israel and the Arab-Israeli conflict, to see for themselves the broader mosaic of life and business there.
What lessons could its culture of innovation and technical grit offer for a Michigan trying to re-engineer itself for a tech-driven future that will affect the hometown auto industry as radically as Henry Ford’s Model T and the moving assembly line?
What economic opportunities could Michigan offer to often-small Israeli companies looking for a toe-hold in a rich U.S. market, especially an automotive space hungry for innovative mobility technology? And what could Michigan business gain from understanding better the technical competence working on a comparatively tiny patch of land at the eastern edge of the Mediterranean?
The MIBA, still in its formative stages, intends to find out.
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