as of January 2018, there were in total 163 chip companies in Israel

It is a universally accepted truth that Israel is a marvellous country. No one will ever deny it. But what is the first thing that pops up in your mind when Israel is mentioned? It will probably be its advanced technology, powerful military, continuous wars, lack of oil, shortage of fresh water, small population, tiny territory, and so on.
It is quite unbelievable and unimaginable that such a small country, whose population accounts for only 0.2% of the world’s population, however, has won 20% of the Nobel Prizes. Suffered from abject poverty and ceaseless wars, the embattled Israel not only managed to survive, but also succeeded in turning itself from a “tiny unimportant country”to a  well-deserved “chips kingdom”in such adversity.
According to the data from Israel’s IVC Research Center, as of January 2018, there were in total 163 chip companies in Israel, including 35 research and development centers, 67 startups, 30 fabless chip design companies, 20 semiconductor manufacturing companies, 10 optical communication companies, and 8 foundry wafer foundries.
Chip Companies in Israel
Artificial Intelligent (AI) Chip Companies
As the AI boom spread all over the world, AI chips have soon become one of the hottest businesses. Being a global leader in AI industry, Israel has also given birth to a lot of AI chip companies.1.Hailo Technologies
Hailo Technologies is an Israel-based company founded in 2017. In May, the company launched its first processor customized for specialized end-to-end deep learning applications, which can be installed in devices including autonomous vehicles, smart cameras, smart phones, drones, VR/AR platforms, and so on. Unlike the processor that is used in data centers, this chip mainly features low power consumption, compact size, affordable price, and operational versatility. Its initial samples are about to be delivered to the main manufacturers and suppliers in automobile and camera industries to undergo performance testing.
In 2018, Hailo Technologies has raised $12.5 million in its completion of a Series A round of financing. This fund is expected to be invested in the development of a deep learning processor intended for data-collecting and data-processing in autonomous driving.2.Habana Labs
Habana Labs, founded in 2016, is a fabless semiconductor company located in Tel Aviv, Israel and San Jose, California. The company specializes in utilizing artificial intelligence to improve processing performance and meanwhile cut costs and power consumption of the chips. Besides, the company developed artificial intelligence processors from scratch, optimizing for the specific needs of training deep neural networks and inference and deployment in production environments. Among all AI semiconductor startups, Habana Labs is the first one, and also the only one to introduce a production-ready AI processor.
In September 2018, Habana Labs introduced the world’s highest performance AI inference processor sample, claiming that its performance is one to three orders of magnitude higher than half of solutions deployed by data centers nowadays . Based on its Goya HL-1000 processor, the PCIe card is able to deliver 15,000 images per second throughput on the ResNet-50 inference benchmark, with 1.3 milliseconds latency, consuming only 100 watts of power. From the ground up, Habana Labs designed the Goya inference solution, aiming to realize deep learning inference.
 

3.Inuitive Inuitive, a Israel’s semiconductor startup founded in 2012, is a company that designs advanced 3D computer vision and vision processors. Leveraging the licensed CEVA-XM4 intelligent DSP, Inuitive is enabled to run complex, real-time depth sensing, feature tracking, object recognizing, deep learning and other vision-related algorithms that target a wide variety of portable devices. The company’s NU3000/NU4000 are application-specific integrated circuits (ASICs) that support 3D Imaging Processing and Computer Vision (CV) processing. It is said that Inuitive is the first and the only one company that offers specific and complete 3D Imaging and CV co-processors.

In 2017, Inuitive and Japanese SoftBank Corp., a subsidiary of SoftBank Group Corp., reached agreement on their collaboration on IoT. In the future, Inuitive’s chips will be used by SoftBank in the field of Internet of Things (IoT). In addition to SoftBank, Inuitive also had collaboration with Baidu and Tencent on robotics. Moreover, the company also set up a squad in Shenzhen for customer support.

1. Vayyar Imaging

Vayya Imaging is a 3D sensor company set up in 2011. The three co-founders of the company all have solid career background. They each have held important positions in high-tech companies such as Intel and all have 20 to 30 years of research and development experience in some professional fields. Among them, two have been in positions of power in Israeli Defense Force (IDF).
As the global leader of 3D Imagining technology, Vayyer Imaging not only developed sensors used for breast-cancer scanning, leakage detecting, safety monitoring, and many other applications, but also successfully developed the Systerm on a Chip (SOC) for mmWave 3D imaging. Each with 72 transmitters and 72 receivers, the chip covers both imaging and radar band ranging from 3GHz to 81G

On December 28, 2017, Vayyar Imaging and SoftBank Corp. jointly announced their agreement on collaboration in the field of IoT. SoftBank is expected to become the channel priority partner for Vayyar’s products in the Japan market. SoftBank stated that there was a great synergistic effect between Vayyer’s sensor technology and its customer demand.5.NeuroBlade
Established in 2017, NeuroBlade is a developer of processors for AI applications, which are developed for autonomous driving, video analysis, and image recognition. NeuroBlade’s chip, based on different technologies and architectures, can resolve the fundamental problem of running AI applications. The chip is aimed to run several neural networks and multiple complex algorithms simultaneously. Elad Sity, NeuroBlade’s CEO, said that NeuroBlade’s processors will be smaller and cheaper than the industry standard. Without disclosing any technical details about the product, he did revealed that the product was planned to hit the market in early 2020.
Powerful Chip Companies in IsraelTowerjazz
Towerjazz, the global specialty foundry leader, is formed through a merger between Tower semiconductor company and Jazz semiconductor company. Towerjazz manufactures chips for smart phones, battery chargers, AC/DC adapters, and image sensors. TowerJazz’s supports customers in various industries including automotive, medical, industrial, consumer, aerospace and defense. Over the last few years, TowerJazz has achieved an unprecedented growth in revenue while it helped its customer to succeed. In the future, the company will continue its pursuit of cutting-edge technology and good quality and will maintain its robust growth momentum.Sckipio
Sckipio, set up in 2012 and eadquartered in Ramat Gan, Israel, mainly develops chips and broadband applications based on G.fast Modem. In 2014, Sckipio introduced the world’s first G.fast Modem chipsets, which are able to deliver up to 2Gbp/s throughput over existing copper wiring, providing a last-mile-broadband access for home users. It fundamentally changed how telecom service providers can supply users in need of broadband with 1Gbps ultra-broadband Internet access at the lowest cost. Allegedly, more than 20% of the Gfast standard in the market comes from Sckipio’s technology. Sckipio once ranked first among Israel’s tech startups and can, without question, be viewed as the global leader in G.fast field.Autotalks
Autotalks is a fabless semiconductor company set up in 2008. This privately-owned company is devoted to providing vehicle-to-everything (V2X) communications for both manned and autonomous vehicles. Autotalks’ first-generation and second-generation chipsets in the market offer the highest performance and reliability, and theyare deployed in various exciting projects of connected and autonomous driving promoted by OEM and Tier1. In addition, Autotalks is the only supplier of global V2X solution that is compatible with any V2X technologies in the world, meanwhile hewing to the highest level of security, functional safety, and automotive requirement reliability.
Chips Companies in Israel That Have Been Acquired
The dominance of Israel’s chips is also made manifest in the fact that many Israeli chip companies with outstanding creativity and research and development capabilities have been acquired by foreign tech giants. According to research by OurCrowd, a Israel’s well-known equity-based crowdfunding platform, over the past ten years, more than 70% of Israeli chip-related companies have succeeded in either completing their IPOs or being acquired after they achieved millions of dollars of revenue.1.Mellanox
Mellanox Technologie was founded in 1999. Headquartered in Yokneam, Israel, the company also set up an office in the United States. With its business focusing on chips for data center servers, Mellanox is a leading vendor of end-to-end interconnect solutions for both servers and storage. It specializes in manufacturing chips for Ethernet that interconnects servers and InfiniBand.
In March 2019, Nvidia officially announced its acquisition of Mellanox for up to $6.9 billion, which remained its biggest acquisition in the NVIDIA’s history. With the help of Mellanox, NVIDIA is expected to make greater progress in the server business, which constitutes approximately one-third of NVIDIA’s entire business.2.ColorChip
ColorChip was founded in 2001 and headquartered in Yokneam, a northern city of Israel. The company mainly designs and manufactures communication components for telecommunication providers and data centers. Besides, it is also engaged in the development of hybrid integration technology based on what the company calls SystemOnGlass. By utilizing glass wafers to make optical components, ColorChip thus brought manufacturing technologies commonly used in the field of semiconductor fabrication to the one of optical communications. The company has its wholly-owned fab in Israel, where it is enabled to make various components. In terms of product, ColorChip mainly holds two portfolios of products – one is its passive PLC splitters for the FTTx markets, and the other is its transceivers for the high-speed internet. Facebook is one of ColorChip’s customers.
In 2018, Sanan Optoelectronics, a China’s chip design company, acquired the ColorChip for $300 million. The acquisition enables Sanan Optoelectronics to further expand its effort to research and develop integrated circuits and communication chips.3.Mobileye
Mobileye is an Israeli company established in 1999 that develops vision-based systems securing passengers’ safety and reducing traffic accidents while driving. The company is the global leader in the development of monocular vision-based advanced driver-assistance systems (ADAS) and it provides system on chip (SOC) and computer vision algorithms to run Driver Assistance Systems (DAS) on customer premise equipment. Mobileye is the supplier of ADAS and autonomous driving technology for 27 famous car brands including BMW, Audi, Tesla, Volvo and Ford.
On March 13, 2017, Intel announced its acquisition of this autonomous driving technology company for $15.3 billion, which became the largest acquisition of an Israeli high-tech company.4.Orbotech
Orbotech, launched in 1981, is a technology company located in Yavne, Israel. After more than 30 years of development, Orbotech has become a global leader in advanced manufacturing solutions. Without its machines, companies like Apple, Samsung, and LG will be unable to manufacture chips or develop new devices.
In March 2018, KLA-Tencor, a US semiconductor company, acquired Orbotech for $3.4 billion, hoping to seek new opportunities in booming markets such as printed circuit boards, flat panel displays, semiconductor manufacturing and packaging through this acquisition.5.Toga Networks
Set up in 2009 and based in Hod HaSharon, Israel, Toga Networks is a provider of advanced technology research and high level design for the IT and telecommunications markets. The company has designed and developed a portfolio of products including switches and routers for the telecommunications industry, meanwhile expanding its business to include cloud storage systems and data center applications.
In December 2016, Toga Networks was acquired by Huawei. Both companies kept the commercial terms of the transaction confidential. Huawei did not provide further details on the acquisition.6.Rocketick
In April 2016, Cadence spent $40 million on its acquisition of Rocketick, an Israeli chip startup. The Cadence Xcelium Parallel Simulator based on multi-core parallel computing technology is exactly built on the technology from Rocketick.7.Wilocity
Wilocity is an Israeli fabless chip manufacturer that is mainly engaged in the development of WiGig chips. WiGig is a new wireless communication technology standard that is able to deliver a wireless transfer speed of up to 7Gbps over a relatively short distance of 10 to 20 meters, operating on a 60GHz band. In July 2014, Qualcomm announced its acquisition of Wilocity for $300 million. 8.Annapurna Labs
Annapurna Labs is an Israel-based chip manufacturer founded in 2011. The company principally specializes in the development of microprocessors, which allow low-power computing servers and storage servers to run data quickly. Annapurna Labs is one of the most prominent chip startups in Israel over the past decade. In January 2015, it was acquired by Amazon.9.Primesense
Founded in 2005, PrimeSense is an Israeli company that has revolutionized the way that digital devices view and understand the world. In November 2013, Apple acquired PrimeSense for $345 million. Recently, PrimeSense’s technology has already been incorporated in the 3D touch technology and it is predicted to be further used in Apple TV.10.BroadLight
BroadLight, an Israeli chip-developer set up in 2000, is the leading supplier of highly integrated networking and embedded processors which provide fiber grade quality of service delivery for central office and customer premise equipment. The company’s main business is providing semiconductors and software for fiber optic communication networks. Before being acquire, it has raised $55 million. In March 2012, Broadcom announced its acquisition of BroadLight for $195 million. In addition to BroadLight, Broadcom aloso acquired another Israeli chip developer Provigent for $313 million in April 2011.
There are still numerous cases of acquisitions of Israeli chip companies besides those mentioned above. For example, ARM’s acquisition of Sansa Security in August 2015, Cisco’s acquisition of Leaba in March 2016, Sony ’s acquisition of Altair Semiconductor in January 2016, Amazon’s acquisition of Annapurna in January 2015. Qualcomm ’s acquisition of Wilocity in July 2014, Apple’s acquisition of Israeli flash memory design company Anobit for about $400 million to $500 million in December 2011, Samsung’s acquisition of Israeli chip design company TransChip for $70 million announced in November 2007, Marvell’s acquisition of LAN chip provide Galileo Technology for $2.7 billion in 2000 and so on.
How Can Israel’s Chips Be So Powerful?
Like Rome, Israel’s status as a “chip kingdom” was not built in one day. According to the report by Israel’s Ministry of Economy and Industry, Israel’s semiconductor industry originated in Intel’s Israel Development Centre (IDC) founded by Israeli engineer Dr. Dov Frohman in Haifa in 1974, which is technically Israel’s first development center. On this basis, Intel’s Israel Company was set up afterwards. Nowadays, Intel is the biggest foreign investor in technology in Israel. Over the past 40 years, many technology giants, represented by Intel, have set up factories in Israel, such as Apple, Broadcom, Qualcomm, Samsung, Huawei, Texas Instruments, LG, Hitachi, Marvell, KLA-Tencor, etc. So how exactly did Israel manage to attract giants from all over the globe? How did it succeed in developing itself to a chip power? Let’s find out the reasons.
(1) Strong deliverability: In semiconductor industry, punctual delivery of design and manufacture is highly valued and required. Israeli development teams possess the ability to develop and make products time-efficiently. This is because most Israeli engineers have once served in the military, and moreover, many Israeli technology companies were actually founded by retired military officers, who acquired the ability to respond and react quickly in the forces.
(2) Open-mindedness and creativity: Israeli engineers are equipped with innovativeness and open mind, especially when it comes to dealing with the issues related to low power consumption, high frequency and compact size. Many large international companies exactly gravitate towards Israeli companies’ creativity, hoping to develop their own businesses with the help of it.
(3) Talent cultivation: Israel’s polytechnics are also one of the factors contributing to the innovation and development of high-tech industries.  More than 70% of graduates are working in high-tech fields. In addition, Israel receives approximately 30,000 immigrants every month, most of whom are highly-educated engineers and scientists and make a considerable contribution to Israel’s technology industry. Israel has a population of only 8 million, while its number of scientists is up to more than 40,000, ranking first in the world per capita. The number of researchers and engineers is even greater, so great that 160 per 10,000 are engaged in research.
(4) Capital support: It can be seen from the venture capital investment in acquisitions listed above that Israel’s leading chip industry has attracted a lot of domestic and foreign capitalists, who kept supporting and nourishing this land by funding.
The article “Understanding Why Israel Is So Powerful After Two Visits” in Vision points out that there are three main reasons for Israel’s excellent creativity:
First and foremost, rather than encouraging students to compete with each other for higher grades, Israel’s education focuses on helping them develop independent thinking skills instead. As a result, Israeli children tend to challenge authority and constantly ask questions even when they are little kids, and when they enter adulthood, they become even more challenging. This unyielding critical thinking ability is made manifest in the saying “Two jews, three opinions.”
Secondly, Israeli culture provides a pleasant environment for creativity to thrive in. In this country, people do not think of failure as a disaster. Neither do they regard it as a big deal. If someone fails to start a company, he or she can simply start another one. The whole society has great tolerance of failure.
Thirdly, the social environment in Israel is entrepreneurship-encouraging in every aspect. Venture capital provides help in finance, and the government provides help in laws and policies, such as establishing business incubators. Israel is so small a country that one can easily get help by pulling strings and asking friends for favors. This also benefits creativity. What’s more, intellectual property rights is highly valued and respected in Israel so that scientists, whose patents can account for 25% of the shares, do not need to be worried that their intellectual property will be stolen.
Last but not least, there is another special reason that can not be ignored. It is Israel’s military service, which requires every citizen to serve in the military, regardless of gender. According to Israeli law, military service is compulsory for both men and women who are 18 years old and above. Men have to complete 3 years, while women have to complete 2 years in the military service. It is exactly this law that has trained a considerable number of officers with management ability.
There is an old saying in Israel that “Two jews, three opinions.”In this country, every person is thinking independently, thus leading to the fierce collision and interaction of ideas between different individuals. In addition, with the help of the highly-developed media, all kinds of ideas can be spread. Therefore, the entire society is and will be keeping up its steady pace of development through constant revision.
Israel has undergone a very special development process. From it, we can learn something, too.