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Tips For Funding in the The New Era of the Israeli Chief Scientist

An exciting development for startups is on the way with the establishment of a

‘National Authority for Innovation in Israel.’ The Authority replaces the Office of the

Chief Scientist (OCS) of the Ministry of Economy & Industry, as well as MATIMOP –

The Israeli Industry Center for R&D. Chief Scientist, Avi Hasson says the move

stems from the need to manage Israel’s most important resource - innovation. The

Chief Scientist had already undergone reorganization in 2015, setting up a specified

administrator, designated committee and separate budget for the startup arena.

Today, the ‘National Authority for Innovation in Israel’ operates independently with

an added 200 million shekels to this year’s existing budget.

If you intend to seek funding, you should know that you can receive between 20- 50

% financing for certain projects and up to 90 % for others. Here are some criteria to

consider:

  • Funds go to new products or significant improvements on existing products.

  • Beta site stages are accredited as part of R & D expenditure.

  • Projects receiving funding from another government source are not eligible.

  • Nanotechnology and biotechnology projects could receive up to 50 % support.

  • R & D projects in area A are eligible for grants up to 60 % of R & D budget.

  • Large companies’ R & D centers in Israel’s periphery could receive grants up to 75 % of the approved budget for 2-3 years.

  • The ETGAR Program supports up to 90 % budget (limited to 500 thousand NIS) for tech solutions relevant to world health in developing nations such as immunization, medical equipment advanced agriculture and more.

The authority also offers support for technological incubators to lead startups towards

Round A investments. Funding can reach 750 thousand dollars of which 85 % is

granted by government and 15% by the incubator. According to Avi Hasson, it is

possible for an entrepreneur to come with an idea and receive support as part of a

technology incubator, then receive funding as part of other ‘National Authority for

Innovation’ programs such as the track for early stage companies or the R & D fund,

and later on collaborate internationally with foreign companies.

Companies should also know that the types of technologies that receive funding are

evaluated not only on the innovativeness in their specific project but also for potential

innovative “spill over” in their industry and into other fields. For this reason, there is a

preference for technologies that are not similar to the ones already existing in the

market. Funding will usually be given for one year, after which the initiative will be

reavaluated based on changes in the market, such as the emergence of competing

products or radical shifts in the industry. In addition to having a business plan with a

detailed SWOT analysis and competitive review, being able to demonstrate initial

sales, a beta stage or complementary funding are also considered highly beneficial.

Special thanks to Michal Reisfeld from the ‘National Authority for Innovation in Israel’

for answering our questions.