Silicon Valley is, in many ways, the beating heart of present-day invention. But when it comes to one of life’s most elemental questions—”What should I eat?”—the place that will define the future is halfway around the world.
Israel is relatively young, the ink of its 71-year-old borders still moist after being drawn onto the world map at the tail-end of the World War II. It has, however, already proven itself a nimble problem solver as the globe thinks more deeply and more seriously about how it will feed its populations in the face of a growing climate crisis.
One source of Israel’s innovation in agriculture is necessity. Surrounded by often-hostile neighbors, trade is inherently complicated for the country, which has a population of more than 9 million.
And then there’s the issue of physical space. The population might be growing, but the amount of arable land for producing food is not. More than half the country’s total land area—some 60%—is made up of the Negev desert, a vast swath of dry terrain that, on its own, would be no good for growing the fruits and vegetables commonly found on tables across the country. Access to water has also become an existential threat in Israel: its aquifers are drying up and the limited sources trickling down from surrounding mountains are disappearing.
Neither trend will reverse.
By 2030, the world’s water needs are estimated to exceed supplies by 40%, a dangerous prospect across the globe, and one that will be felt acutely across the dryer Middle East.
In the Hebrew Bible it is written in the book of Isaiah that, “The arid desert shall be glad, the wilderness shall rejoice and shall blossom like a rose.” Thanks to Israel’s technological advances, those ancient words have been realized. Today, the Negev desert is literally where most of the country’s $200 million cut-flower industry operates—replete with thousands upon thousands of yellow roses, peonies, red anemones, and countless other species, 90% of which are exported. It’s also where about 40% of the nation’s produce is grown, and where a lot of its fish is farmed via aquaculture operations.
Only 13.73% of Israeli land is arable.
In some ways, Israel, with its vast arid landscape and dwindling water supply, has already had to contend with the effects of the warming planet that is only just beginning to reshape other parts of the world where lots of food is grown. Thanks to their own circumstances, Israelis have innovated their way out of pressing agricultural problems, and the world is starting to notice.
The ingenuity pouring out of the Holy Land has even caught the attention of people in and around Silicon Valley, where access to sustainable, reliable, and clean water is expected to become increasingly difficult.
In his 1881 book The Innocents Abroad, Mark Twain offered a scathing review of the area that was then Palestine, and now makes up Israel. “A desolation is here that not even imagination can grace with the pomp of life and action,” he wrote.
But if the Israeli startup ecosystem is any indication, human imagination has prevailed. According to data analytics firm Startup Genome, Israel has more startups per capita—close to one per 1,400 people—than any other country, and its startups collectively raised close to $6.47 billion in 2018 alone. Most of that is comprised of artificial intelligence and cybersecurity technology, but food and agriculture is a growing space for the nation’s tech scene says Anya Eldan, who manages the startup division of the government’s Israel Innovation Authority.
“Food is a great example because five years ago there was no food tech here,” Eldan says. “This is how ecosystems are built.”
In the last five years, the number of startups operating in Israel has ticked up to 8,400, with 307 of those in the food and agriculture sector, according to the IVC Research Center, which tracks the Israeli tech industry. In all, the firm reports that between 2013 and 2018, venture capital in the Middle Eastern country has topped $25 billion, with food and agriculture technology representing a small, but noteworthy, $927.6 million of that total.
“Agriculture is the best thing that Israel has to offer the world,” says Danielle Abraham, who leads Volcani International Partnerships, a non-profit group that works to strengthen Israel’s standing as a global power in agricultural research and development.
The technological vanguard is often described as being in California’s Bay Area. so it’s ironic that the state is turning beyond its borders for answers to what is arguably its most pressing problem. Our smartphones and social networks might be designed in San Francisco, but the technology getting food and water to people is increasingly coming from Israel.
The Golden State has a lot in common with Israel. Both have dry, Mediterranean-like climates that are slowly getting warmer. Both pump about 60% of their water into agriculture. And both have experienced punishing droughts. The economic hit California’s agricultural sector took due to a 2015 drought is estimated to be $2.7 billion, with a loss of 21,000 jobs.
California has launched and completed three climate-change assessments, the last one in 2012. Since then, researchers have shown the state has experienced several of the “most extreme natural events in its recorded history,” which include a five-year drought, a tree-mortality crisis, the scourge of damaging wildfires, and destructive flash flooding. A fourth assessment has already shown those types of climate-driven events will only worsen as time marches forward—making it much more difficult for the agricultural industry.
That has broad global implications. California, with a gross state product of around $3 trillion, is often ranked as the world’s fifth-largest economy. Agriculture is huge in the state. The California Department of Food and Agriculture calculates that agriculture is a $42.6 billion dollar industry—with all the food it grows and exports beyond state and national lines—generating around $100 billion in economic activity.
In 2014, California governor Jerry Brown and Israeli prime minister Benjamin Netanyahu signed a memorandum of understanding that made official the American state’s special relationship with Israel, as well as its interest in importing many of the Middle Eastern country’s best ideas, particularly cutting-edge water technology that could relieve some of the effects of climate change.
Thanks to Israel’s pioneering water technology sector, more than half of the nation’s water—for residential, commercial, and agricultural consumption—is artificially produced. The country is using desalination technology to pull water from the salty Mediterranean and making it potable, and innovative wastewater treatment and recycling technology prevents most water waste. The Israeli system is so efficient that the country now produces about 20% more water than it consumes, allowing it to export surpluses and create an industry worth $2 billion annually.
Israeli water technology companies are in many ways using California as a real-world laboratory for how to one day export their ideas and tech to other parts of the world, including Africa, South America, and India. Suddenly, revolutionary ideas that originated on Israel’s tiny socialist kibbutzes, its small, communal farming communities, are finding their way to California and are beginning to upend decades of water practices employed by farmers.
Israel is home to at least three of the world’s nine cutting-edge cell-cultured meat companies. These currently small but ambitious startups aim to take cells from animals and grow them into real meat, avoiding slaughter and the negative environmental impact of modern-day animal agriculture.
What makes these Israeli startups particularly special, though, is the type of meat on which they’re focusing. While competing startups in other nations are creating mostly easier-to-make minced meat products and chicken nuggets grown from animal cells, Israeli companies such as Aleph Farms, are trying to figure out how to grow whole cuts of meat, such as steak. Growing meat with natural-seeming texture and consistency is a trickier science, but their advances in the space have earned Aleph millions in investment, including from global food leader Cargill.
The work puts Israel on the cusp of disrupting a long-standing market at a time when people are interested in trying new forms of meat. Estimates by CB Insights show that close to 30% of the calories humans eat come from meat products, which include beef, chicken, and pork. Per capita, people each year eat about 95 pounds of it, up from 44 pounds in 1961. And more people are expected to get onto the meat bandwagon, particular in China and India where the middle classes are growing and people are spending more disposable income on animal-based products.
For a long time, much of the massive meat market has been dominated by six major companies, which together have a market capitalization of more than $60 billion. But people are interested in more environmentally-sustainable options, including plant- and cell-based foods. Beyond Meat, a plant-based meat company, went public in the US this year, and currently has a market valuation of more than a billion dollars. Now cell-cultured meat companies are edging ever closer to the stock market, too, and Israeli tech startups are expected to be ready to strike when that times comes.
Speaking of buzzing around, in March 2016 United Airlines started the first direct flight between San Francisco and Israel, formally connecting two of the world technological start-up hubs. Since then other airlines, including Israel-based El Al, have followed suit.
That flight was adopted by popular demand. More than 8,500 people, including Google Ventures investor Eze Vidra, signed a petition to get the flight path up and running.
Just why Israel has become a startup oasis remains a talking point that people within the Israeli tech bubble seem eager to discuss. Some argue that the skills learned through the nation’s mandatory military service play a major role. Once people leave the military, they can apply their military know-how to civilian challenges. Others say it’s as simple as the tradition of sitting down to shabbat dinner, which takes place every Friday evening and brings large family groups to one table. The traditional meal creates a forum for the exchange of ideas, as family members from all sorts of professional backgrounds discuss life over dinner.
“We’re a very entrepreneurial culture but also multi-disciplined,” Eldan says. “People love to talk about their problems and people love to solve other people’s problems.”
So when a farmer at the table discusses a problem with water leakage in an on-farm irrigation system, it’s not inconceivable that someone else at the table who has military experience monitoring the leakage of data might brainstorm ways to apply their know-how to the farm setting.
“And startups happen,” Eldan says.
When they do, the Israel Innovation Authority is one of the distinguishing factors that sets Israeli tech apart from American tech. The government plays an active role in supporting new ventures, and specifically seeks to aid high-risk innovation through the authority, which wields an annual budget of about $500 million.
“We provide some of the budget that companies need,” Eldan says, adding that that can be 30% to 90% of a startup’s early-stage budget. The government supports about 500 new companies each year and currently has a portfolio of about 1,300.
The support comes in the form of conditional loans. If the startups fail, no money is returned to the government. If they find success, the seed money is paid back to the government. And Eldan is looking for hyper-ambitious ideas to help fund.
“If we got back 100% of the money, we’d think we’re not taking enough risk,” she says. “Our role is to build a successful, competitive innovation industry.”
All of these factors fuel Israeli entrepreneurs’ abilities to solve problems, and because of Israel’s place in the world, a lot of the problems they happen to encounter intersect with food or agriculture. And that gives them fertile ground on which to embark on some of the most innovative solutions to the world’s problems.