Suburbs Trying to Woo Israeli Businesses With Designated Tech and Startup Sector
Governor Deval Patrick recently traveled to Israel with a goal of showing off the booming tech sectors sprouting up statewide and touting Massachusetts’ growing economy, trying to appeal to a broader range of businesses looking to expand their global reach.
Already there’s been some success, with a majority of the businesses from Israel that decide Massachusetts is the next big move for them looking to squeeze into spaces in Cambridge’s Kendall Square and Boston’s Innovation District. But parts of the suburbs are starting to steal the spotlight—and they’re not afraid to boast about it.
On Thursday, representatives from Newton and Needham, and the Israeli American Council and Israeli Consulate, will host an event with leaders from some of the top Israeli companies that chose to relocate or plant their roots just outside of Boston.
The meetup is an effort to convince more businesses to move to the “N2 Corridor,” a designated neighborhood space along Interstate 95 that was designed to entice tech giants, startups, and innovators outgrowing their current headquarters. That plea to welcome more companies includes urging CEOs to follow in the footsteps of other Israeli-born businesses.
“This is extremely important. The city of Newton and state of Massachusetts have a very special connection with the state of Israel,” said Newton Mayor Setti Warren, who traveled with Patrick to Israel during his recent trade mission in May. “We see Newton—and particularly the places around Newton, like Waltham, Watertown, and Needham—as a place where Israeli companies can grow and be successful and we can continue to attract a cluster of those companies. It’s a real opportunity to expand economic growth outside of Boston.”
The area is already home to CyberArk, an information security firm founded in Israel that expanded to Massachusetts and launched a “highly successful” IPO this year. CyberArk’s CEO, Udi Mokady, will be one of the lead speakers at Thursday’s invite-only event at the company’s headquarters in Newton.
The Governor made a similar trip in 2011 to Israel, which resulted in biotech firm EarlySense bringing jobs to Massachusetts after building its headquarters in Waltham, near the N2 Corridor. A second Israeli company, Desalitech, Ltd., which deals with water treatment solutions, also moved its headquarters to Newton following that trip.
Last year, the New England-Israel Business Council released an in-depth study about the connections between the Bay State and Israel, citing that more than 200 Israeli companies decided to call Massachusetts home in 2012 alone, funneling billions of dollars in direct revenue to the state’s economy that year, while creating thousands of jobs at the same time.
David Goodtree, who’s part of the organizing committee for the Governor’s business trips, and a member of the New England-Israel Business Council, said relationships forged between the Bay State and business leaders in Israel, matched with the recent announcement about direct flights between the two locations, has increased the appeal of picking the suburbs as a place to call home for these companies.
“The Massachusetts economy is significantly driven by innovation from around the globe, in particular Israel,” said Goodtree, a partner at an Israeli venture capital firm that’s invested in companies here. “We have generated close to $7 billion in revenue from those 200 companies in the 2012 calendar year, and employed close to 7,000 people—and they grow three times faster than the economy overall statewide.”
Goodtree said a lot of these companies get started and have a small employee base, and are attracted to Cambridge and the Innovation District in the Seaport area. But as they succeed and expand, and look to bring their families to the Commonwealth, they need more space, affordable housing, and reliable transportation. “They also want to be close to other talents, whether it’s engineers or sales people, or even other executives. They need more office space, and more affordable office space,” he said.
And that’s where the appeal of the N2 Corridor space comes in, he argued. “It’s a prime destination for growth stage companies,” said Goodtree.
Greg Reibman, president at the Newton-Needham Chamber of Commerce, said they have spent the last year building up their presence at the appeal of the corridor space, and Thursday’s event with elected leaders and company representatives is one additional push to make the message clear: the suburbs as next logical place to go.
“For Israeli companies, the N2 Corridor is a welcoming community, with a strong Jewish community and the Jewish Community Center right there. There’s a cultural connection and lifestyle that’s appealing,” he said. “We think even more of these companies will be interested now that we have direct flights between Israel and here as well.”