Trade Missions Should be Viewed Over Long Term

I just had an op ed published in Mass High Tech on Governor Deval Patrick’s recent 10-day Innovation Economy Partnership Mission to Israel and the U.K.

Too often, the sole criteria used to judge whether a trade mission is a success is jobs.  Unfortunately, this is short-sighted. Economic development strategies must be designed for the long-term.

The Commonwealth’s economic plan needs to have at its core a focus on growing its local, existing business base, while still looking beyond its borders for strategic global opportunities. The right missions, such as this one, are key to our future success.

Mass. Officials Make Their Case to Israeli Entrepreneurs

Editor’s Note: NAIOP CEO David Begelfer is traveling with Governor Patrick’s Trade Mission to Israel and is sending daily updates on their progress.On our third day in Israel, Governor Patrick led a Town Hall: “Collaborating as Leaders in the Innovation Economy” at The Technion (Israel’s “MIT”).

Governor Patrick at The Technion

Questions centered on what early stage resources were available if the Commonwealth wanted to attract start-up businesses? 

Susan Windham-Bannister, President & CEO of the Massachusetts Life Sciences Center, explained that the Center was established to promote and make financial investments to grow life sciences companies. The Center is there to fill the gap in the “Death Valley” of VC funding, the period from when a startup receives initial capital to when it begins generating revenues. Additional financing is usually scarce during this time, so the Center provides 5-year loans to qualified firms.

Patrick Cloney, Director of the Massachusetts Clean Energy Center, said they are promoting the state’s clean energy industry by making direct investments and providing assistance to access capital. In 2009, the state’s ratepayer-funded Renewable Energy Trust Fund was transferred to the Center.

Finally, Pat Larkin spoke about the Massachusetts Technology Collaborative, which encourages the formation, retention, and expansion of technology-related enterprises.  As Director of the MTC’s John Adams Innovation Institute, he makes investments in the knowledge-based economy.

Other notable moments on the trip included a presentation by Haifa Mayor Yona Yahav who spoke to our delegation at the Combined Jewish Philanthropies’ Boston-Haifa Connection’s “Shiluvim” program (an effort to help Ethiopian Jewish immigrant children adjust to a new life in Haifa).

And the BEST falafel stand in Tel Aviv!

Direct Boston-Israel Flights Key to Economic Investment

Today, at the start of the Massachusetts – Israel Innovation Economy Partnership Mission with Governor Patrick, our first meeting of the day was with the CEO of El Al Airlines, Major General Eliezer Shkedi. A small group of us met with the General and his staff to pitch having El Al open non-stop direct flights between Boston and Tel Aviv.

General Shkedi, Governor Patrick and Robert Kraft

If there was one single action that could directly affect the growth of new Israeli businesses in the Commonwealth, it would be the convenience of direct flights. Boston is already the second largest origin-destination, business market without nonstop service and Massachusetts ranks 5th among U.S. states for air exports to Israel.

With the ties that we share with Israel in the High Tech, Life Sciences, Finance, and Higher Education sectors, our shared economic future is certain to support this important service.

Companies like EMC, Cubist, and Glasshouse Technologies all indicated their company’s strong interest in supporting direct flights.  Robert Kraft made the obvious statement that non-stop flights are not only good for their business, they would be profitable for El Al, with higher paying business passenger revenue.

Governor Patrick proposed that both “sides” have their staff work on the numbers over the next six months and reach a decision about the feasibility of these flights. General Shkedi agreed to see if it can work.

Right now, El Al is considering non-stops to Miami and Chicago. We might not be able to compete with the large Jewish population in South Florida, but we should hold up well with Chicago, especially with El Al’s partner airline’s (Jet Blue) major expansion in Boston.

Who knows, in a year or two, sitting on the tarmac in New York may not be necessary to get to Tel Aviv.

Off to Israel with Governor Patrick

An important part of NAIOP’s mission is to promote overall economic development, which in turn supports the Commonwealth and its business community.  As such, I am honored to represent the members of NAIOP by joining Governor Deval Patrick, along with a coalition of state officials and business leaders, on next week’s Massachusetts Innovation Economy Partnership Mission to Israel. The coalition will explore growth opportunities within the Commonwealth’s innovation-based industries – technology, life sciences, clean energy and financial services – and areas of common interest between the state’s established and emerging partners in Israel.  The coalition will then continue on to the UK.

During the trip, I will join Governor Patrick and members of the delegation in roundtables, company visits, and meetings with government and business officials in Tel Aviv, Haifa, and Jerusalem.  I believe the mission is an important opportunity for the Commonwealth to explore new growth opportunities and business relationships in the global market, which could lead to increased real estate investment and development throughout the state

There are nearly 100 companies with Israeli founders or Israeli-licensed technologies in Massachusetts today.  In 2009, these companies employed nearly 6,000 people and generated $2.4 billion in direct revenue for the state. Local firms exported over $180 million worth of goods to Israel in 2009 and, at 12.35 percent, the United States is Israel’s largest source of imports.

I plan to blog from Israel and provide regular updates about what we learn. When I return, I and other participants from this trip and last fall’s City to City trip will present a program on The Boston-Israel Connection, presenting our findings and exploring the possibilities for growth that will benefit our industry.