Built to Sell

I don’t usually write about business on my blog. I spend way too much time working, so blogging about work seems a foolish thing to do. But I felt like the following picture, appearing in The Marker this week, deserved a comment:

The background: an young Israeli start-up company, YaData, was acquired by Microsoft. Although the exact amount was not disclosed, it was quoted as being a “very nice rate of return on the investment”, which probably means tens of millions of dollars. This is yet another Israeli high-tech success story, a good example of the engine driving Israeli economy and helping it attain a GDP per capita that surpasses that of most European countries. Kudos to the entrepreneurs and the investors behind the company.

But the “SOLD” message (with those big grins) in the picture above is annoying. There are far too many “entrepreneurs” that set up new companies with an explicit, typically lightning-speed, exit strategy. There are not enough entrepreneurs that have a vision to build a company over a long period of time, going through the hard work of creating an Israeli “Nokia”. The challenges are huge, given the particular circumstances of Israel, but it can be done, as Teva, Amdocs and others have shown. The “SOLD” mentality is definitely great for the bank accounts of those smiling entrepreneurs, but I’m not sure it is good for Israeli economy as a whole.

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