A USAID program implemented by
Building an Innovative IT Sector through Global Partnerships The Cisco Announcement ExpoTech, held annually in Ramallah, has become a mustFour years ago, Palestinian IT companies were still attend event, attracting global ICT firms such as Cisco, Intel, struggling to recover from the second intifada, which Microsoft, Google and HP. disrupted the few fledgling relationships they had outsourcing projects that were coordinated through managed to establish with international firms and Cisco’s Corporate Social Responsibility office in Israel greatly increased the perceived risk of doing business and engaged 20 Palestinian software engineers. Three in the Territories. The industry was fragmented, years later, that figure has doubled, and the contracts with no clear vision for sector-wide growth and are now financed directly by Cisco Israel’s Research development and little understanding of what role it and Development (R&D) department, as with the could play in the global marketplace. Despite USAID company’s other outsourcing relationships. “We’re efforts to engage the Israeli branches of large U.S.trying to bring not only money, but multipliers like based tech firms, the obstacles to working with know-how, knowledge, partners,” Palestine were considered too Mr. Hetzroni explains. great and the potential benefits “We’re trying to bring too small. For multinational firms not only money, but The contracts also brought muchlooking for emerging markets in multipliers like knowneeded credibility to the sector. which to invest, “Palestine was how, knowledge, Building on this momentum, simply not on the map,” says Gai partners.” CARANA Corporation’s Hetzroni, Senior Project Manager Enterprise Development and for Corporate Affairs at Cisco Gai Hetzroni Investment Promotion (EDIP) Systems Israel. Sr. Project Manager for Corporate project renewed outreach efforts Affairs at Cisco Systems Israel to other multinational firms with a That all began to change in 2008 targeted message—that Palestinian when John Chambers, CEO of companies are a viable resource for top-quality, lowCisco Systems, pledged US$10 million to seed a cost project management—and a successful model to sustainable model of job creation and economic back it up. This time, the firms responded. development in the Palestinian Territories. 80% of the commitment was intended for venture capital HP Gets in the Game financing, but Palestine had no venture capital funds By late 2009, managers at Hewlett Packard (HP) to administer the investment. The industry also had learned of Cisco’s positive experience with lacked the culture of collaborative innovation and the Palestinian IT firms, but they were still wary of entrepreneurship that fuels start-up companies. attempting a cross-border collaboration, unsure if the benefits would outweigh the risks. Recognizing The first phase of the initiative focused instead on 1