Israelis And Palestinians Build Ventures Against The Odds

September 11, 2026 CryptoExpert Uncategorized
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A VC’s Podcast Calling

Seven weeks before Israel and Hamas went to war for the third time in six years, I sat in Tel Aviv moderating a panel at Israel’s premier innovation conference. The 2014 session was called “Tomorrow’s Triangle: Breaking the Hi-Tech Barriers from Herzliya to Nazareth to Ramallah.” It’s where I first met Yadin Kaufmann, an Israeli-American venture capitalist who was hopeful, almost unshakably so, that hi-tech could bridge Israelis and Palestinians when almost nothing else could.

It was a heady time. In a cover story called “Peace Through Profits,” Forbes took readers into Ramallah and Jericho to see under-the-radar high-tech co-ventures between Palestinians and Israelis — with Cisco celebrated as a trailblazer. As for Kaufmann, he’d co-founded the first venture capital fund built specifically to invest in Palestinian tech startups. It raised tens of millions of dollars from major backers such as Google, Cisco, and the European Investment Bank. He also founded the Palestinian Internship Program (PIP), a nonprofit that has placed more than 100 Palestinians, each fresh out of college, with 60 tech companies in Israel, including Google, Intel, and Teva, the Israeli generic drug giant. (Through a sister initiative launched in 2020, the program also matches Palestinian tech entrepreneurs with global mentors.)

That 2014 panel came two years before Forbes brought hundreds of changemakers to Israel for a global summit under the banner of “Co-Invest, Co-Create, Co-Exist.” Former Prime Minister Shimon Peres spoke at the event, with an innovation-as-peace-strategy the centerpiece of his remarks. A few months later, when I interviewed him in his office at the Peres Center for Peace, a year before his death, he spoke at length, almost wistfully, about his vision for the future. “Deep in my heart, I would like to help our neighbors, the Arabs, to reach the same level of economy, of technology as we are,” he said. “And I think we can do it easier and better than many others [nations].” It was a vision that Kaufmann, in his own way, had already spent years building on the ground.

The terror attacks of October 7, 2023 marked the deadliest day for Jews since the Holocaust, and ignited the deadliest war between Israel and Hamas. Many contracts and partnerships between Israelis and Palestinians were abruptly severed, the practical fallout of grief, trauma, anger, and mistrust that, three years on, still hasn’t found room for repair.

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Perhaps with that in mind, Israel’s leading event-planning company denied me permission to use a photo from that 2014 conference – the same company that, back then, had sent me 20 photos of the panel, though I’d never sought to publish any of them. This time, they wouldn’t clear a shot of Kaufmann at the podium, a PowerPoint slide behind him detailing the nascent Palestinian high-tech ecosystem in the West Bank, opening with the line “…The Next Start-Up Nation?” As the manager put it, “There are elements in the photo that we are not able to approve for publication.” Asked several times to explain, the manager went silent.

Despite such dark clouds, the PIP internship program is very much active, Kaufmann says. “We said we’re not giving up.” Demand from Palestinian applicants has actually been strong, he says, “really surprising to me. I didn’t know whether any Palestinians would want to apply to a program connected with Israel, but they get a lot of value from it, and they want it. But it’s been harder to find companies in Israel willing to take on an intern, understandably, since October 7, and the internships have to be remote now, because nobody’s getting permits to come in.”

Kaufmann’s latest venture, launched in late July, is a podcast series called Unlikely Partners, where he interviews pairings of Israelis and Palestinians, some, remarkably, working in Gaza itself, who collaborate across the divides. It’s early-stage and low-budget, but that raw quality fits its subject. As Kaufmann tells his audience: “Most people think Israel-Palestine is a zero-sum game, and that cooperation between Israelis and Palestinians is impossible now. Yet there are people who are doing it anyway.” Seven episodes have dropped, with five in the hopper, and more to come. (A recent episode features former US ambassador Dan Shapiro as a guest interviewer.)

Kaufmann says the response to the podcast has been overwhelmingly positive, with occasional blowback — hardly surprising, given today’s climate. Major Western media outlets focus overwhelmingly on the region’s heartaches. Violence gets the clicks. Stories like the ones on his podcast rarely get covered at all – forget a deep dive.

This isn’t a show built for TikTok or Instagram clips. These are stories about Israelis and Palestinians “defying the odds” and “navigating significant obstacles to create something that neither could build alone,” he said at the start of the first episode. “This isn’t about politics or about solving the conflict. It’s about what happens when two people from opposite sides decide to bet on each other.” Still, “peace” surfaces now and then in what guests say. How could it not? They talk about each other with real, unguarded warmth, the trust it takes to build something together, and what it means to stop seeing your partner’s background and just see your partner.

That’s hard partly because Israel is nothing if not dizzyingly complicated. Ask someone born there who they are, and you may get several answers at once: Israeli, Arab and Palestinian can all describe the same person, who might also identify as Christian, Muslim, or Druze. (Jewish Israelis carry their own layered identities, too: Ashkenazi, Mizrahi/Sephardic, Ethiopian, Russian-speaking, and more.) Arab citizens make up about a fifth of Israel’s population, but a 2024 Tel Aviv University survey found that 9% of them named “Palestinian” as their most central identity; most instead named Israeli citizenship, religion, or Arab identity.

Where the show earns its keep, though, is in the episodes themselves, each one singular, both in who’s involved and in what these partnerships actually look like up close. (Quotes below are from the podcast and from my own conversations with some guests, lightly edited for length and clarity.)

  • Takwin Ventures — Of the seven partnerships featured so far, the one I know best, and the one I’ll go into more depth on later, is Haifa-based Takwin (Arabic for “genesis”), the only venture capital fund specifically for Arab entrepreneurs in Israel. Its CEO and managing partner, Itzik Frid, sat a few seats from Kaufmann on that same 2014 panel. Its VP of marketing and business development, and the operational backbone of the fund, is Fadi Swidan, an Israeli-Arab Christian from Nazareth, a main source of Arab high-tech talent in Israel.

Takwin’s Frid: “An Arab entrepreneur needs to be ten times stronger than the average Jewish entrepreneur, because being an entrepreneur is a torture. Being an Arab entrepreneur is ten times the torture.” Swidan, recalling two failed attempts to break into Israeli high-tech as a young Israeli Arab entrepreneur: “She [my wife] looked at me and said, ‘Fadi, that’s enough. We are living in Nazareth Shwarma Valley, and you are acting and speaking like you are in the Silicon Valley, and that will not work.’”

The Takwin story:

Takwin Ventures was the brainchild of Imad Telhami, the fund’s chairman and one of Israel’s leading Arab-Israeli industrialists and entrepreneurs, who brought in a pair of heavyweight co-founders: Chemi Peres, son of the late Shimon Peres, and Erel Margalit — two of Israel’s most prominent venture capitalists. The logic was straightforward: Arab citizens make up about a fifth of Israel’s population but barely register in its booming tech workforce — an injustice as well as a lost business opportunity.

Telhami has something rare among economic powerhouses: genuine modesty. “The more he does for others, the more he shies away from publicity,” says Frid. Over dinner in 2014 at a rooftop restaurant overlooking the rugged terrain of northern Israel, just days before the announcement of the fund, he spoke calmly, though clearly excited about what he was building.

High tech defines Israel to the world. Yet Arab citizens have long felt shut out of it, and their exemption from compulsory military service means they miss the tech training, team-building and leadership experience many Jewish Israeli founders credit for their success — along with the mentorship, connections, and access to bank loans that might otherwise compensate.

“It’s really fear of failure,” Telhami explained. “Arabs think respectfully — so when they fail, they think it’s the end of the world and can’t get up again. That’s why people don’t take the risk — just give me something safe, a salary so I can’t fail and everyone will laugh at me.’ It’s the culture. A pride… Because of this fear, you can’t dream and imagine that you’ll be able to own a company.” Frid sees the contrast plainly: “In Jewish society, it’s common knowledge that if you fail, no worries. You dust yourself off and start all over again, as the song goes”— the Jerome Kern classic “Pick Yourself Up.” He sings a verse to drive the point home. (Oy gevalt, the man can carry a tune.)

The numbers bear this out, even as they’re improving. Arabs comprise just 4% of the high-tech sector, up from 2% a decade ago — still a long way to go. The pipeline feeding that number looks better than it used to: Roughly 20% of the student body at Technion (“Israel’s MIT”) is Arab, closely mirroring the Arab share of Israel’s population.

Demographics help, too — the average Arab Israeli is about 21, versus about 32 for Israeli Jews. “Young people are more daring,” Frid says. “Although we do not see enough women entrepreneurs, two out of three Arab students in Israeli universities are women, and women are always stronger, better, braver than men — they drive the change as well.”

Telhami’s answer, years before Takwin, was to build a company that put Arab Israelis to work directly. He launched Babcom (Arabic for “your door”) in 2008; today it employs 5,000 people in call center outsourcing, software development, and what he calls “human AI” services, and works with nearly all of Israel’s 100 largest companies. It’s become one of Northern Israel’s biggest employers, having put more than 40,000 people to work since it launched. Inside Babcom, instructors from a mix of ethnic backgrounds coach Arab employees on taking the kinds of risks their culture discourages. And its 450 managers are split evenly, half Jewish, half Arab.

Takwin was the natural next step for him. Babcom gave Arab Israelis jobs. Takwin is about giving them ownership, letting them found and run the companies, instead of just working for them. “The opposite of an entrepreneur is a victim,” Telhami says. [Telhami and Babcom will be the subject of an upcoming story.]

No institution shapes “Startup Nation” more than the military. Jewish citizens face compulsory service, though only about 60% of them actually complete it these days — that number’s in flux, as the fight over ultra-Orthodox conscription spills into the streets. Recruits who pass through elite units like Unit 8200, or the super-secretive Unit 81, come out with real technical skills. They also come out with something else: a network. And in Israeli tech, that network is often the difference between an idea and a funded company.

Arab citizens, including Bedouin, are legally exempt from that service. A small and slowly growing number enlist anyway, but historically that has meant missing one of the fastest on-ramps into Israeli high-tech. Two communities are exceptions: the Druze, an Arabic-speaking, non-Muslim ethnoreligious group, and the Circassians, a non-Arab, Sunni Muslim group with their own language. Both requested compulsory conscription not long after Israel’s founding (although it remains voluntary for Druze living in the Golan Heights). Welcome to Israel! It’s a lot more mixed up than you probably thought.

Even among the roughly 2,000 non-Jewish citizens who enlist each year, only a small fraction ever reaches the elite cyber or R&D units. Geography compounds the problem: Arab, Druze, and Circassian communities are clustered in the north, far from the Tel Aviv tech corridor. “And the north doesn’t have much high-tech industry to begin with,” Frid says, “so why study for a career you’re not likely to find employment in, and that you’d have to leave home to use?”

Change has been slow, but it’s happening. In 2009, a Druze army veteran started building a tech hub for the community in northern Israel, so people wouldn’t have to leave home to get into the industry. A few coding programs have since popped up in Druze and Arab towns where students are paired with mentors serving in active-duty cyber units. The Israeli government got involved last December too, committing to a five-year plan for tech and innovation centers stretching from Druze and Circassian towns in the north to Bedouin communities in the Negev.

But teaching people to code only solves part of the problem. What’s harder to build is access — the networks and capital that actually turn a skilled engineer into a founder. That’s the gap Takwin exists to fill.

Frid joined as the fourth founder of Takwin and since then has been running it with Telhami. An Israeli Jew born and raised in Tel Aviv, where he still lives, he came to the fund after serving as a senior advisor to Israel’s Minister of Finance and as VP of business affairs at AOL. Swidan, who heads marketing and business development, brought years of Arab-tech-ecosystem experience with him. He grew up in Nazareth — still home base for him, and known as the Arab economic capital of Israel — graduated from Technion in the early 1990s, earned an MBA in the US, and returned in 1997. He tried entrepreneurship twice and failed twice.

Recognizing how isolated Arab entrepreneurs were from the Tel Aviv ecosystem, he directed a government-run business hub in Nazareth, offering early-stage Arab-Israeli ventures mentorship and support. From there, he co-founded NazTech, the first accelerator for Arab entrepreneurs in Israel, backed by the Ministry of Economy and Cisco, and later built a second accelerator, Hybrid — a joint venture between the government and alumni of Unit 8200 — giving Arab founders access to the same network that decides who gets pre-seed money in Israeli tech. “What we tried to do in Nazareth, and now at Takwin, is change the culture,” he says, “make it feed itself with new success stories, a new mindset. Not fear, but daring.”

Ask Frid, as Kaufmann did in the podcast, how a Jewish CEO and an Arab VP actually work together day to day, and he shrugs off the premise. “As amazing and as shallow as it sounds, once you go into the offices of any of the Takwin companies, the difference between the Arabs and the Jews isn’t seen,” he says. “I don’t think of Fadi as my Arab friend and partner. He’s my friend and partner.” That held even through the darkest weeks of the recent war. “We asked everybody, both Jews and Arabs, to avoid statements about October 7,” Frid says. “We talked to the employees. We mitigated it, because we needed to respect each other’s tensions.” Swidan puts it in more personal terms: “When you choose a partner, you choose a set of problems with that partner. At the end, they have a baby they’re working very hard to raise, and they have to find a way to keep working together to overcome all these problems.”

Takwin remains the only venture fund built specifically for Arab entrepreneurs in Israel. It isn’t an accelerator or incubator in the strict sense, though it ends up doing some of both for its companies, and it’s structured to be profitable. Many of its investors are wealthy American Jews, and some are wealthy local Arabs. By its own numbers, Takwin has a strikingly strong record for a fund that does only pre-seed and seed deals: 10 of its 14 portfolio companies have succeeded, and the aggregate value of that portfolio, $420 million, is up 150% since 2021. Harder to measure is how it has fused that world into the mainstream tech scene rather than building a parallel one beside it.

The portfolio spans mobility, healthcare, agriculture, seismology, and nanotechnology. Two standouts came out of academic and engineering talent rather than the military track: Imagry (founded by two Palestinian engineers from East Jerusalem) and Feelit Technologies, cofounded by Arab and Jewish researchers at Technion, which makes nanotech sensors that stick to industrial equipment to predict failures before they happen. Seismic AI, an early earthquake-alert system powered by AI, is already commercially deployed in multiple countries.

Imagry has raised over $80 million, has 120 employees, and has become a bona fide world leader in autonomous bus-driving tech. “They’re all over the place,” exclaims Frid. “They employ people in Israel, Palestine and the US, and the tech is deployed in Germany, Israel, Japan, and many places to follow.”

Others worth mentioning: SORLIS, whose cofounders include an Arab female pediatric surgeon, is developing a device that uses electromagnetic waves to detect pressure ulcers early; Deriva uses AI to help genetic-testing labs figure out what a person’s DNA mutations actually mean; and qaTT builds AI that watches a company’s cloud computing systems and flags problems before they snowball into outages.

None of this has traveled easily into Palestinian territories. “We tried a lot to find startups in the West Bank, Palestinians to invest in,” Swidan says. But the entrepreneurs kept telling him the same thing: “We don’t want investment from an Israeli VC, because it’s not yet a legitimate option in the Palestinian perception.”

What happened next explains some of that caution. In 2022, the West Bank’s tech sector employed roughly 10,000 people across 450 companies and pulled in about $500 million in revenue. After October 7, Israeli clients suspended or canceled contracts en masse, and layoffs and pay cuts tore through the industry. Nobody’s published a clean update since — the industry’s too busy surviving to count itself. Little has stepped in to fill the gap. “In general, this space is void,” says Gai Hetzroni, CEO of the Israeli-Palestinian Chamber of Commerce. “Also, the death of USAID killed a lot of initiatives. We are trying to help and support cooperations, but it’s a tough task, and there’s no money for it.”

Gaza’s tech scene, meanwhile, is all but gone, but it was never much to begin with: A few dozen funded startups over the years, a small accelerator, and several thousand people earning a living through remote freelancing. Before the war, Telhami had gotten a green light from Israeli authorities to open a tech center in Gaza linked directly to the UAE. “I got their permission because they said ‘You are doing a great thing for Israel and for Palestinians, because to employ people is something good,’” he recalls. He signed a contract, hired more than 50 people, and envisioned employing as many as 10,000 Gazans for Emirati companies. “But unfortunately, all of that has disappeared now.”

Takwin’s response to the war was to move fast — remarkably within weeks of October 7, it launched an initiative to invest in up to five startups in five weeks, explicitly framed as a response to the disruption facing Arab-led startups and their funding pipelines. More than 250 entrepreneurs applied, including some from Ramallah and Hebron in the West Bank, but those Palestinian applicants, Frid says, weren’t really after Takwin’s money. “When meeting them, we understood that they participated to have our feedback and not investment, because they are addressing the Arab world market and investors [some in the Gulf], and they do not want an Israeli investor in the cap [capitalization] table.”

Frid has a story that captures the whole tension in a single breath. A Palestinian partner in one of Takwin’s leading portfolio companies, backed since its earliest stage, once heard him raise the idea of going public about the investment if the company exited: “This is a company of Palestinians, Israelis, and Jews together — that would be a great story to tell.” The partner didn’t hesitate: “No way. We will never release that you [Takwin] ever invested.” “But you’re giving hope to young Palestinians, hope for the region,” Frid told them. “This is our role.” The partner wouldn’t budge: “I know you’re thinking that way, but we as Palestinians will never do it. If you release a PR [press release], we will never mention we were involved.”

It’s a pessimistic story, Frid concedes — “but the optimistic side is that it can change in a flick of a second.” Kaufmann would probably see it the same way — his whole podcast is built on exactly that flick of a second, the moment someone who might have stayed quiet decided to go on the record instead.



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