Start-up Nation (10 page)

Medved then hints to the multinationals in the room that they are likely to be missing something if they have not already
set up shop in Israel. He finds out in advance of each presentation which companies’ executives will be in the audience and
is then certain to mention which of their competitors are already in Israel. “The reason that Israel is inside almost everything
we touch is because almost every company we touch is inside Israel. Are you?” he asks, peering into the audience.

Medved has taken on a role that, in any other country, would typically belong to the local chamber of commerce, minister of
trade, or foreign secretary.

But the start-ups Medved champions in his presentations are rarely companies in which he has invested. He’s always torn when
he prepares for these speeches: “Do I talk up Vringo among the promising new companies coming out of Israel? It’s a no-brainer,
right? It’s good exposure for the company.” But he resists the urge. “My pitch is about Israel. My American investors beat
me up over this—‘You wind up plugging your competitors but not your own company.’ They’re right. But they’re missing the larger
point.”

Medved is in perpetual motion. He’s given the presentation fifty times a year for the last fifteen years. All told, almost
eight hundred times, at technology conferences and universities around the world, in over forty countries, and to scores of
international dignitaries visiting Israel.

Alex Vieux,
CEO
of
Red Herring
magazine, told us that he has been to “a million high-tech conferences, on multiple continents. I see Israelis like Medved
give presentations all the time, alongside their peers from other countries. The others are always making a pitch for their
specific company. The Israelis are always making a pitch for Israel.”
⁹

The social graph is very simple here. Everybody knows everybody.

—Y
OSSI
V
ARDI

D
AVID
A
MIR MET US AT HIS
J
ERUSALEM HOME
in his pilot’s uniform, but there was nothing
Top Gun
about him. Soft-spoken, thoughtful, and self-deprecating, he looked, even in uniform, more like an American liberal arts
student than the typical pilot with crisp military bearing. Yet as he explained with pride how the Israeli Air Force trained
some of the best pilots in the world—according to numerous international competitions as well as their record in battle—it
became easy to see how he fit in.
¹

While students in other countries are preoccupied with deciding which college to attend, Israelis are weighing the merits
of different military units. And just as students elsewhere are thinking about what they need to do to get into the best schools,
many Israelis are positioning themselves to be recruited by the IDF’s elite units.

Amir decided when he was just twelve years old that he wanted to learn Arabic, partly because he knew even then that it might
help him get accepted into the best intelligence units.

But the pressure to get into those units really intensifies when Israelis are seventeen years old. Every year, the buzz builds
among high school junior and senior classes all across Israel. Who has been asked to try out for the pilot’s course? Who for
the different
sayarot
, the commando units of the navy, the paratroopers, the infantry brigades, and, most selective of all, the Sayeret Matkal,
the chief of staff’s commando unit?

And which students will be asked to try out for the elite intelligence units, such as 8200, where Shvat Shaked and his cofounder
of Fraud Sciences served? Who will go to Mamram, the IDF’s computer systems division? And who will be considered for Talpiot,
a unit that combines technological training with exposure to all the top commando units’ operations?

In Israel, about one year before reaching draft age, all seventeen-year-old males and females are called to report to
IDF
recruiting centers for an initial one-day screening that includes aptitude and psychological exams, interviews, and a medical
evaluation. At the end of the day, a health and psychometric classification is determined and service possibilities are presented
to the young candidate in a personal interview. Candidates who meet the health, aptitude, and personality requirements are
offered an opportunity to take additional qualifying tests for service in one of the IDF’s elite units or divisions.

Tests for the paratrooper brigade, for example, occur three times each year, often months before candidates’ scheduled draft
dates. Young civilians submit themselves to a rigorous two days of physical and mental testing, where an initial group of
about four thousand candidates is winnowed down to four hundred future draftees for different units. These four hundred paratroopers
can volunteer to participate in the field test and screening process for the special forces, which is an intensive five-day
series of eleven repeating drills, each lasting several hours and always conducted under severe time constraints and increasing
physical and mental pressure. During the entire time, rest periods are short and sleep almost nonexistent, as is food and
the time in which to eat it. Participants describe the five days as one long blur where day and night are indistinguishable.
No watches or cell phones are allowed—the screeners want to make the experience as disorienting as possible. At the end of
the five days, each soldier is ranked.

The twenty top-ranking soldiers for each unit immediately begin the twenty-month training period. Those who complete the training
together remain as a team throughout their regular and reserve service. Their unit becomes a second family. They remain in
the reserves until they are in their mid-forties.

While it’s difficult to get into the top Israeli universities, the nation’s equivalent of Harvard, Princeton, and Yale are
the IDF’s elite units. The unit in which an applicant served tells prospective employers what kind of selection process he
or she navigated, and what skills and relevant experience he or she may already possess.

“In Israel, one’s academic past is somehow less important than the military past. One of the questions asked in every job
interview is, Where did you serve in the army?” says Gil Kerbs, an intelligence unit alumnus who—after pursuing the Book—today
works in Israel’s venture capital industry, specializing in China’s technology market. “There are job offers on the Internet
and want ads that specifically say ‘meant for 8200 alumni.’ The 8200 alumni association now has a national reunion. But instead
of using the time together to reflect on past battles and military nostalgia, it is forward-looking. The alumni are focused
on business networking. Successful 8200 entrepreneurs give presentations at the reunion about their companies and industries.”
²

As we’ve seen, the air force and Israel’s elite commando units are well known for their selectivity, the sophistication and
difficulty of their training, and the quality of their alumni. But the
IDF
has a unit that takes the process of extreme selectivity and extensive training to an even higher level, especially in the
realm of technological innovation. That unit is Talpiot.

The name Talpiot comes from a verse in the Bible’s Song of Songs that refers to a castle’s turrets; the term connotes the
pinnacle of achievement. Talpiot has the distinction of being both the most selective unit and the one that subjects its soldiers
to the longest training course in the IDF—forty-one months, which is longer than the entire service of most soldiers. Those
who enter the program sign on for an extra six years in the military, so their minimum service is a total of nine years.

The program was the brainchild of Felix Dothan and Shaul Yatziv, both Hebrew University scientists. They came up with the
idea following the debacle of the 1973 Yom Kippur War. At that time, the country was still reeling from being caught flat-footed
by a surprise attack, and from the casualties it had suffered. The war was a costly reminder that Israel must compensate for
its small size and population by maintaining a qualitative and technological edge. The professors approached then
IDF
chief of staff Rafael “Raful” Eitan with a simple idea: take a handful of Israel’s most talented young people and give them
the most intensive technology training that the universities
and
the military had to offer.

Started as a one-year experiment, the program has been running continuously for thirty years. Each year, the top 2 percent
of Israeli high school students are asked to try out—two thousand students. Of these, only one in ten pass a battery of tests,
mainly in physics and mathematics. These two hundred students are then run through two days of intensive personality and aptitude
testing.

Once admitted into the program, Talpiot cadets blaze through an accelerated university degree in math or physics while they
are introduced to the technological needs of all
IDF
branches. The academic training they receive goes beyond what the typical university student would receive in Israel or anywhere
else—they study more, in less time. They also go through basic training with the paratroopers. The idea is to give them an
overview of all the major
IDF
branches so that they understand both the technology and military needs—and especially the connection between them.

Providing the students with such a broad range of knowledge is not, however, the ultimate goal of the course. Rather, it is
to transform them into mission-oriented leaders and problem solvers.

This is achieved by handing them mission after mission, with minimal guidance. Some assignments are as mundane as organizing
a conference for their fellow cadets, which requires coordinating the speakers, facilities, transportation, and food. Others
are as complicated as penetrating a telecommunications network of a live terrorist cell.

But more typical is forcing the soldiers to find cross-disciplinary solutions to specific military problems. For example,
a team of cadets had to solve the problem of the severe back pain suffered by
IDF
helicopter pilots from the choppers’ vibrations. The Talpiot cadets first determined how to measure the impact of the choppers’
vibrations on the human vertebrae. They designed a customized seat, installed it in a helicopter simulator, and cut a hole
in its backrest. Next they put a pen on a pilot’s back, had him “fly” in the simulator, and used a high-speed camera inserted
in the backrest hole to photograph the marks caused by the different vibrations. Finally, after studying the movements by
analyzing computerized data generated from the movement information in the photos, they redesigned the chopper seats.

Assuming they survive the first two or three years of the course, these cadets become “Talpions,” a title that carries prestige
in both military and civilian life.

The Talpiot program as a whole is under Mafat, the IDF’s internal research and development arm, which is parallel to America’s
DARPA
(the Defense Advanced Research Projects Agency).
Mafat
has the coveted and sensitive job of assigning each Talpion to a specific unit in the
IDF
for their next six years of regular service.

From the beginning, the hyperelitism of the Talpiot program has attracted critics. The program almost didn’t get off the ground
because military leaders did not think it would be worthwhile to invest so much in such a small group. Recently, some detractors
have claimed that the program is a failure because most of the graduates do not stay in the military beyond the required nine
years and do not end up in the IDF’s senior ranks.

However, though Talpiot training is optimized to maintain the IDF’s technological edge, the same combination of leadership
experience and technical knowledge is ideal for creating new companies. Although the program has produced only about 650 graduates
in thirty years, they have become some of Israel’s top academics and founders of the country’s most successful companies.
NICE
Systems, the global corporation behind call-monitoring systems used by eighty-five of the Forbes 100 companies, was founded
by a team of Talpions. So was Compugen, a leader in human-genome decoding and drug development. Many of the Israeli technology
companies traded on the NASDAQ were either founded by a Talpion or have alumni situated in key roles.

So the architects of Talpiot, Dothan and Yatziv, vigorously reject the criticisms. First, they argue that the interservice
competition for Talpions within the IDF—which at times has had to be settled by the prime minister—speaks for itself. Second,
they claim that the Talpions easily pay back the investment during their required six years of service. Third, and perhaps
most importantly, the two-thirds of Talpiot graduates who end up either in academia or in technology companies continue to
make a tremendous contribution to the economy and society, thereby strengthening the country in different ways.

Talpions may represent the elite of the elite in the Israeli military, but the underlying strategy behind the program’s development—to
provide broad and deep training in order to produce innovative, adaptive problem solving—is evident throughout much of the
military and seems to be part of the Israeli ethos: to teach people how to be very good at a lot of things, rather than excellent
at one thing.

The advantage that Israel’s economy—and its society—gains from this equally dispersed national service experience was driven
home to us by neither an Israeli nor an American. Gary Shainberg looks more like a sailor (of the compact, stocky variety)
than a tech geek, perhaps because he is an eighteen-year veteran of the British navy. Now vice president for technology and
innovation at British Telecom, he met us late one evening in a Tel Aviv bar. He was on one of his many business trips to Israel,
en route to the gulf—to Dubai, actually.