Three new technological incubators will be set up in Akko, Haifa and the Golan.
The Ministry of the Economy Office of the Chief Scientist is opening three new incubators in the central region as part of its incubators program. The program, led by Incubators Program general manager Anya Eldan, has announced three new competitive procedure to choose franchise holders, who will operate three incubators for eight years: one in the Golan district, one in the Akko district, and one in the Haifa district.
The competitive procedures, which are part of the reform in the incubators program initiated and implemented by previous director Dr. Yossi Smoler, are gradually replacing the privatized incubators operating under the old rules. Before the reform, an incubator franchise was granted for three years, but was frequently extended almost automatically. In the new procedure, the franchise will be for eight years, but only after a tender with threshold conditions. The criteria include a minimum investment in the incubator, proven ability to make follow-on investments, and experience with entities in the incubator’s designated field of operation and in investments and support in high-tech companies.
The change has indeed brought impressive franchise holders to the program, including Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT), Nielsen, Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) in cooperation with global corporation Philips, OrbiMed Advisors LLC in cooperation with international companies Johnson & Johnson and Takeda Pharmaceutical, Hutchison Telecommunications International, and other leading parties. This is the first investment in startups in Israel for some of these concerns.
By order of the Ministry of the Economy director general, signed this week, two substantial changes were introduced into the tender: preference will be given to franchise holders with more than one shareholder, and the franchise holders will have to undertake to make follow-on investments amounting to at least NIS 50 million. It appears that the more stringent conditions indicate demand on the part of franchise holders to operate the incubators.
Projects in the incubators program receive an 85% grant from a budget of NIS 2 million for the first two years in the incubator, and sometimes also additional money later. The money must be repaid only in the event of success.
Source: Published by Globes [online], Israel business news – www.globes-online.com – on March 24, 2015 © Copyright of Globes Publisher Itonut (1983) Ltd. 2015