Fintech Week Tel Aviv: Bringing innovators, investors together

The rapid growth of Fintech Week

Fintech Week has grown rapidly in recent years, reflecting the growth of the fintech sector in Israel and worldwide. As the fintech landscape continues to evolve and new technologies emerge, Fintech Week remains at the forefront of the industry, providing a forum for the exchange of ideas and the exploration of new opportunities.

Jonny Paul, director of Fintech Calling, a B2B Fintech conference production company, is the mastermind behind Fintech Week. Talking with The Jerusalem Report from the Tel Aviv Stock Exchange on Day 2 of the conference in early March, Paul stated: “I have a huge affinity for Israel. It is known as a hub of innovation. The innovation and start-up scene is known worldwide. We saw an opportunity to bridge the divide and showcase Israeli innovation. Fintech is about collaboration, and there are great opportunities within the Israeli ecosystem. In 2017, we set up Fintech Week in Tel Aviv, a three-day event at the Tel Aviv Stock Exchange. We bring in Israeli start-ups at all levels. We bring in many internationals who are interested in collaborating and investing and in acquiring.”

“I have a huge affinity for Israel. It is known as a hub of innovation. The innovation and start-up scene is known worldwide. We saw an opportunity to bridge the divide and showcase Israeli innovation. Fintech is about collaboration, and there are great opportunities within the Israeli ecosystem. In 2017, we set up Fintech Week in Tel Aviv, a three-day event at the Tel Aviv Stock Exchange. We bring in Israeli start-ups at all levels. We bring in many internationals who are interested in collaborating and investing and in acquiring.”

Jonny Paul

Now, seven years later, Fintech Calling has grown tremendously. It works very closely with Israeli authorities, from the Bank of Israel and the Israel Securities Authority to the Israel Export Institute, which has helped bring foreign delegations to the conference.

“It’s about showcasing Israeli innovation. When I see companies coming together and when I hear about successful collaborations, it makes me happy, said Paul. “This year we have ZeePay, a payment company in Ghana. They have been part of Fintech Week for the last three years. In these three years, they have established cooperation with Israeli start-ups. It gives me a lot of joy. It’s all about cooperation.”

Nathan Joel, originally from Australia, made Israel his permanent home five years ago and is now the director of Growth for Kipp, an Israeli start-up based in Herzliya and supported by TLV partners. He attended Fintech Week to meet foreign banks and to establish connections in the local ecosystem, Israeli-based startups, investors and potential partners. “For us at Kipp, we focus on solving the problem of when you check out on a website with your credit card and the credit card company declines your transaction. We’re focused on helping merchants and credit card issuers actually approve that transaction so more sales go through and provide a better experience for the consumer.”

Speaking about the benefits of working in the Israeli market, Joel said: “Israel is a hub of innovation for fintech companies. The big fintech companies like Riskified have spawned a number of second-generation fintech companies like Kipp. Tel Aviv has been a great place for us to establish and get advice from local experts. One of the most important benefits of being here is the support of the ecosystem and how closely connected everyone is here in Israel. It’s a real advantage for us, from being able to do business with a local bank to have support from Mastercard’s Finsec Innovation Lab to support from the Israel Innovation Authority, where we have also received some funding.”

INNOVATE FINANCE, the independent industry body for UK fintech, was also present. Veronica Glab, Head of Engagement for Innovate Finance, spoke to The Jerusalem Report about why attending Fintech Week was a must for Innovate Finance. “We came to talk to the international investment landscape and really look at the venture funding of global fintech, as well as across different global regions, verticals, and really analyze the latest trends. We also wanted to get to know the Israeli fintech ecosystem . We have a number of partnerships with fintech Israel and we are very happy to see such a burgeoning market in such a small country. Israel has shown its resilience and its innovation in the last 10 years. There is a very strong fintech ecosystem here , and there is a vested interest on the part of the UK and Israel to build a thriving ecosystem and a bridge between the two countries. At Innovate Finance, we couldn’t be more excited about that!”

Paul Kenny, representing VacuumLabs, a company that develops products and services in the fintech sphere, summed up in one line why Israel is such an important destination for this industry: “Israel is the startup nation.”

He added: “There are so many technology companies here. And Israel is the most successful country in the world, outside of the United States, in terms of attracting venture capital.”

Alexandre Gaillard is CEO of InvestGlass, a sales automation solution for banks based in Switzerland, which plans to expand into Israel and open an office in Tel Aviv in 2023. Why Israel? Gaillard replied: “We have just opened an office in Dubai and are pleased to see the good relationship between the Emirates and Israel, so it is a logical continuation of our business expansion in this part of the world.”

Israel is one of the leading countries in terms of high-tech innovation as demonstrated by the participants of Fintech Week. The main reasons why it can be a good opportunity to invest in high technology in Israel are the following:

• Skilled workforce: Israel has a highly talented workforce, with a strong emphasis on STEM (Science, Technology, Engineering and Mathematics) education. This means that there is a large pool of well-educated people who can contribute to high-tech innovation.
• Governmental funding: The Israeli government has been a major supporter of its high-tech sector, which has become one of the most dynamic and innovative in the world. The government provides a number of support mechanisms to promote growth and development in the sector, such as tax incentives, grants and funds for research and development (R&D).

These include a reduced corporation tax rate for qualified companies, as well as tax deductions for R&D expenditure. The government also provides grants to high-tech companies at various stages of development, from seed funding to expansion. These grants can be used for a number of purposes, such as R&D, product development and market entry. The Israeli government itself invests heavily in R&D through its own research institutions and through partnerships with private industry.

This funding supports basic and applied research in a wide range of fields, such as biotechnology, cyber security and artificial intelligence. Overall, government support for the high-tech sector has been a key factor in the sector’s success, helping to create a thriving ecosystem of innovation, entrepreneurship and investment. This support has also helped attract international investment and talent, further strengthening Israel’s position as a leading hub for high-tech innovation.

• Access to capital: Israel has a robust venture capital industry, with many Israeli VC firms investing in high-tech start-ups. This provides access to capital for new start-up companies and helps drive innovation.
• Global market: Israel is strategically located at the crossroads of Europe, Asia and Africa. This gives Israeli high-tech companies access to a global market and enables them to easily connect with customers and partners from all over the world.
• Entrepreneurial culture: Israel has a strong entrepreneurial culture, with many successful entrepreneurs and entrepreneurs. This culture encourages innovation and risk-taking, which is essential for the high-tech sector.

Potential risks of investing in Israel

LIKE ANY investment, investing in Israel carries some risk. Some of the potential risks that investors should be aware of include the following:

• Political instability: The Israeli-Palestinian conflict and tensions with neighboring countries can create political instability, which can negatively affect the economy and markets.
• Security risks: Israel faces security risks from terrorism, cyber attacks and geopolitical tensions. These risks can affect the safety of investors and the stability of the markets.
• Regulatory and legal risks: Like any country, Israel has its own regulatory and legal environment, which may differ from other countries. Investors should be aware of local laws and regulations that may affect their investments.
• Currency risk: Investing in Israel involves exposure to Israeli shekels, which can fluctuate against other currencies, potentially affecting the value of an investor’s holdings.
• Financial risks: Israel’s economy is heavily dependent on exports, especially in the high-tech sector. A decline in global demand or changes in trade policy could adversely affect the economy and markets.

Despite these risks, many investors see Israel as an attractive investment destination, especially in the high-tech sector, due to its strong economic fundamentals, innovative and entrepreneurial culture, and supportive government policies. As with any investment, it is important to conduct thorough research and due diligence before investing in Israel. ■