fb-pixelFirms linked to Israel prospering in Mass. - The Boston Globe Skip to main content

Firms linked to Israel prospering in Mass.

Companies with ties to Israel have become a significant force in Massachusetts, multiplying their revenues over three years and employing roughly 6,700, according to a new study released Thursday.

At least 200 businesses, cutting across the state’s innovation economy, have Israeli connections, according to the study for the New England-Israel Business Council, a group aimed at fostering collaborations between Israel and New England. Together these companies — including information technology, medical device, and software firms — last year generated $6.2 billion in revenues in the state.

A previous study found 78 companies generating $2.4 billion in revenues in 2009.


The economic impact of the Massachusetts-Israel connection is only expected to grow in coming years, as capital, customers, and technical talent attract more Israeli firms to the state — particularly in emerging sectors such as nanotechnology, robotics, and 3-D printing, the report said

“It’s the new markets that will provide the turbocharge,” said David Goodtree, the local consultant who authored the study.

Nicknamed the “Startup Nation,” Israel and its people are known for producing game-changing innovations, including computer processors used by Intel and search algorithms used by Google. But its startups often must leave the small Middle Eastern nation to grow to a global scale and access world markets.

Those firms have found a home away from home in Massachusetts, where local universities, business incubators, and technology companies have produced their own share of ground-breaking advancements. Attracting innovators from places such as Israel has become an important part of the state’s economic development strategy. Governor Deval Patrick led a trade mission to the country in 2011 to promote the state’s life science and biotechnology industries.

“There’s a lot compatible between Massachusetts and Israel,” Patrick said Wednesday. “Arguably brainpower, in both cases, is our biggest natural resource.”


Businesses in the report include those founded in Israel with offices or headquarters here, Israeli firms acquired by Massachusetts companies, and local companies founded by Israelis or based on Israeli intellectual property.

Massachusetts companies frequently tap the Israeli innovation pipeline. Boston Scientific Corp. the Natick medical device maker, and Akamai Technologies Inc., the Cambridge Web content delivery firm, have spent millions buying Israeli companies in recent years.

Akamai, with nearly $1.4 billion in revenues last year and roughly 3,000 employees, was cofounded by the late Daniel Lewin, a former Israeli commando who went to the country’s famed scientific university, Technion.

Massachusetts’ largest technology firm, Hopkinton data storage company EMC Corp., has acquired nine Israeli companies for roughly of $2 billion since 2005. Joel Schwartz, EMC’s senior vice president of global new business development, said Israel has been an important source of technology that has helped build the company and fill gaps in EMC’s research and development programs.

EMC’s flagship data storage product, Symmetrix, for example, was created by an Israeli-led team. In July, the company signed an agreement to buy ScaleIO , an Israeli data storage startup.

“It’s not that we have a particular desire to do more in Israel,” Schwartz said, but “it stands out almost more than any other place in the world as a high-tech startup environment.”

Most recently, state and business leaders have focused on using Israel’s leadership in water technology to create an industry hub here that will produce solutions to global water shortages. Israel, meanwhile, sees the partnership as a way to launch its companies onto the world stage.

“The relationship is only going to grow stronger,” said Richard K. Sullivan Jr., state energy and environmental affairs secretary. “We’ve got the real bones of a significant water cluster here.”


The New England-Israeli Business Council’s study made several recommendations to help Massachusetts stay ahead of other states also vying for Israeli business, including getting nonstop air service between Boston and Tel Aviv and providing more educational opportunities for Israeli students at local universities.

“We are a knowledge economy,” Goodtree said of Massachusetts. “We don’t create it all; we attract people here, starting at university.”

Erin Ailworth can be reached at eailworth@globe.com. Follow her on Twitter @ailworth.