海角大神

Amid much fanfare nearly a year ago, Israeli President Shimon Peres inaugurated a听听with the vision of luring technology companies and hundreds of software engineers to Israel鈥檚 largest Arab city.

But today, save for a handful of tenants, the office suites are still mostly vacant, underscoring the听yawning听digital听business gap between Jews and Arabs, who are largely excluded from听Israel鈥檚 start-up success.听This is not simply a matter of access to capital and networks, but also cultural omissions, both within the Arab community and in Israeli society.

"We are trying to bridge the entrepreneurship gap. In the Arab sector, we don鈥檛 have any investors or success stories," says Fadi Swidan, who runs Nazareth鈥檚 government-backed business incubator and a technology accelerator dubbed . "We have entrepreneurs that have technology skills but we don鈥檛 have the experience.鈥欌��

Mr. Swidan was speaking on the sidelines of a听recent government-run 听in Nazareth for Arab tech entrepreneurs.听Behind such initiatives is the idea that if Israel doesn鈥檛 empower its highly educated Arab youth,听the economy will be the loser. 听听听听听听听听听听听听

The figures are sobering: Arab citizens of Israel,听who make up one-fifth of the population,听account for only 3 percent of the technology workforce. According to the Office of the Chief Scientist 鈥� a division of the Economy Ministry that funds and trains tech听companies 鈥� less than one percent of its听annual budget of $450 million in business research grants goes to Arab-run businesses.

The Nazareth office park was intended to听boost that figure听and to bring tech jobs closer to Arab communities. Israel鈥檚 government听has听also begun offering more flexible听grants听and subsidies to Arab entrepreneurs for business consulting and market surveys.听

"For Arabs it is harder in studies, harder to get accepted for jobs. You have to be three times better than a Jew. I鈥檓 not debating this," Economy Minister Naftali Bennett told the conference. "Arab high tech is at a tipping point. If we work wisely in the next five years, and we give the correct push, you won鈥檛 need our help."

Arabic-language Internet

In theory, Arab Israeli tech entrepreneurs听are situated in a sweet spot: they can access Israeli tech know-how and venture capital, and use that to seed start-ups in the rapidly growing Arabic-language Internet.

This is the thinking behind , which was set up four years ago with backing from the government and from Pitango, a veteran investment company set up by Mr. Peres鈥� son Chemi. Al Bawader has so far raised over $50 million and made investments in seven companies.听

But the challenges facing Arab Israeli techies remain formidable. They include discrimination听by Jewish听employers,听a culture not accustomed to the high-risk world of venture capital; and the sheer distance between Arab and Jewish business circles.

Tally Zingher, a lawyer who has advised Arab Israeli entrepreneurs, said the gap is so big that one of her clients听turned to听a Jordanian investor instead of those at home.听

鈥淭hey are totally disconnected from meet-ups and networks,鈥� she said.听 鈥淪ome of these initiatives will help them. But it鈥檚 going to take time.听They are at the bottom of the ecosystem.鈥�

Military experience

Another factor: Jewish techies get to tinker with cutting-edge technology听while serving in Israel鈥檚 military; and establish social听connections that pave their way in business after they leave.听听

An Arab entrepreneur who graduated from Israel鈥檚 prestigious Technion Institute points out that certain military technology units and defense industry companies are essentially off limits to Arab Israelis.

鈥淓verything can be shielded as military. Everything is sensitive. I understand that,鈥� says the entrepreneur, who asked to remain anonymous. 鈥淚 wanted to study satellite imaging. It has a lot of civilian uses, but here the focus is always on the military. That鈥檚 the main roadblock.鈥�

Then there鈥檚 bank financing. Rabei Ibrahim, the founder and CEO of , one of the few tenants of Nazareth鈥檚 new office park, says banks in Nazareth aren鈥檛 used to lending to start-ups. And banks in main Israeli cities are not used to handling Arab entrepreneurs. 听

Risk and reward

For Israel鈥檚 government, another line of attack is to听encourage Israeli technology firms to hire Arab tech engineers听and to prepare Arab candidates for interviews.听This has had limited success so far.

But cultivating Arab entrepreneurs requires something extra: the stomach for risk taking.

That鈥檚 a relatively daunting proposition for a population that鈥檚 accustomed to small family-run businesses in traditional service and manufacturing industries. Developing a hi-tech entrepreneurial tradition doesn鈥檛 happen overnight, says Johnny Ghattas, an Arab telecom expert who mentors start-up entrepreneurs.

鈥淭he Arab culture is not the same as the Jewish culture or the American culture,鈥� he says. 鈥淵ou need to find the people willing to take the risk and educate them about the opportunities. Arabs are not less intelligent, or less professional. They need to build up trust with the organizations, and to go for it. And by the way, I don鈥檛 have the solution.鈥澨�