Jimmy Wales tells us how to net a fortune the Wiki Way

Wikipedia founder Jimmy Wales shares his views with Candice Krieger on what makes a successful start-up, the need to honour failure — and why he loves Facebook. The US entrepreneur was in London for UK Israel Business's Innovate Israel conference.


Wikipedia's Jimmy Wales says a high tolerance to failure is key to innovation

Wikipedia's Jimmy Wales says a high tolerance to failure is key to innovation

Successful start-ups are all about the execution says Wikipedia's Jimmy Wales.

Having a great business idea won’t make you a millionaire. It’s the execution that will.
Such a sentiment is sounded by Wikipedia founder and chief executive, Jimmy Wales.

The brains behind one of the world’s most famous websites, Mr Wales was the keynote speaker at the British Israeli Business Awards gala dinner — the final part of an all-day technology convention, focusing on Israeli innovation.

Spearheaded by trade organisation UK Israel Business, Innovate Israel is being dubbed the largest ever business event between the UK and Israel. It connected dozens of digital Israeli start-ups with UK investors and counterparts during a day of high-profile panel discussions and networking, which culminated in the awards dinner (winners right) at the InterContinental, Park Lane hotel, London.
Talking to JC Business, Mr Wales said: “When starting a business, it is mostly about the execution. There is this myth of the ‘genius entrepreneur with the great idea’ but most of the time, it is all about the execution and getting it right.”

Israeli Innovation: stats and facts

Israeli Innovation: stats and facts

Wikipedia is an online free encyclopedia that anyone can edit. He acknowledged that “dozens of people had talked about creating a free encyclopedia online but noone actually did it.”
Mr Wales did — in 2001. Today, Wikipedia is the fifth largest website with over four million English articles and 490 million visitors a month.

Mr Wales is a fan of Mark Zuckerberg’s Facebook. “I think that Facebook is quite remarkable; the way they have stumbled a few times but always recover, and the way that they aggressively work on improving their product. They make themselves an indispensable part of the infrastructure. It’s pretty amazing. There were similar networks that came before Facebook but failed because they didn’t understand their customers.”
What advice would he offer aspiring entrepreneurs? “Starting a business that goes under in three years is better than not starting a business at all.

“Having a high tolerance for failure is really important. If you eliminate that myth of the ‘amazing genius idea and everything magically working out’ you realise that there are going to be a lot of stumbling blocks along the way. Sometimes you will fail and have to start all over again.
“Problems can’t be solved by doing the same things we have always done. We are going to have to innovate and come up with new things.

“So by default, innovating new solutions means experimenting and failing a lot, and we need a culture that recognises failure. Israel gets this in a big way but the UK, not so much.”
The American entrepreneur has spent much of this week campaigning to stop British university student Richard O’Dwyer from being extradited to the US to face charges of copyright infringement for creating link-sharing website, TVShack.net.

During the dinner, Mr Wales was interviewed by Alex Brummer, the Daily Mail City editor and JC columnist, and was pressed for his views on piracy, the power of the internet and “open-access” sites.
Among the day’s other globally-renowned speakers were: Wonga founder Errol Damelin; Brent Hoberman, the founder of lastminute.com; Virgin Green Fund partner Toby Coppel; Mark Read, director of strategy at WPP; Rene Rechtman, head of International AOL Advertising Group; Lionsgate’s Guy Avshalom, and Horizon Ventures’ Frank Meehan.

They addressed a top-level audience of close to 500 people, comprising representatives from Google, BSkyB and Vodafone.

Discussion topics included digital advertising, mobile money, the future of television, and what is the next big thing? According to panelists Brent Hoberman and Mark Read, the latter includes “the internet of things”, which refers to identifiable objects that are connected to the internet/mobiles, such as a fridge that lets you know when it is empty.
Innovate Israel was co-chaired by prominent internet entrepreneurs Marc Worth and Yossi Vardi, aka “the godfather” of Israeli high-tech.

A memorandum of understanding between the British Venture Capital Association (BVCA) and Israel Advanced Technologies Industries (IATI) was signed to enhance collaboration between the two organisations and VC community.

Daniel Taub, the Israeli Ambassador to the UK, said: “Trade between Israel and Britain already stands at £3.75 billion and the potential to build on that in the high-tech fields is very exciting. Innovate Israel was an opportunity to explore that and discover new ways to work together to promote innovation, growth and jobs in both countries.”

BRITISH ISRAEL BUSINESS AWARDS. WHO WON?

British Company of the Year 2012: Barclays, for opening a new Research & Development (R&D) centre in Israel
Israeli Company of the Year 2012: Delek for their purchase of Roadchef
Business Person of the Year 2012: Dr Abe Peled, for the sale of NDS to Cisco for $5 billion

WHAT DO THE EXPERTS THINK ABOUT ISRAELI INNOVATION?

BRENT HOBERMAN, co-founder of Lastminute.com, profounders capital and mydeco
The best tech innovation to come out of Israel?
ICQ, the instant messaging computer program, and more recently, Shai Agassi’s Better Place. Also, Israel’s commercial applications of their military technology.
Why Israel for tech?
There is something about the way people are trained to challenge authority. It’s an entrepreneurial mindset. Israelis have to think laterally and they apply that to start-ups.
What can the UK learn from Israeli innovation?
Risk-taking — it’s respected in Israel. And the commercialisation of heavy science.

GUY AVSHALOM,co-founder and COO of Lionsgate UK
The best tech innovation to come out of Israel?
ICQ, the instant messaging computer program.
Why Israel for tech?
It is independent and free-thinking. There is an entrepreneurial spirit and a disregard for boundaries.
What can the UK learn from Israeli innovation?
Entrepreneurial spirit and stretching the boundaries. I think a lot of Israelis believe that they can achieve everything they want.
They are not confined by what is technically possible or not.
They are more likely to follow their vision regardless of circumstances.

RENE RECHTMAN, head of Intl. AOL Advertising Group
The best tech innovation to come out of Israel?
A successful early-stage example was when PayPal acquired Fraud Sciences. And ICQ, one of the early catalysts for the start-up tech culture.
Why Israel for tech?
The mix of military service, lessons learned, technical universities, venture money and large emigration puts Israel in a unique position.
What can the UK learn from Israeli innovation?
Risk-taking, entrepreneurship and the nature of thinking, which is global from day one; the UK seems to service the domestic market with overseas as an afterthought.

FRANK MEEHAN,Horizon Ventures
The best tech innovation to come out of Israel?
In the early 2000s, Israeli start-ups often didn’t get the consumer experience right. But now, design and ease of use in Israeli start-ups are as important as the technology itself, leading to much greater success.
Why Israel for tech?
The drive, passion and skills that Israeli entrepreneurs have.
What can the UK learn from Israeli innovation?
Encouraging innovation and large-scale investment into R&D. People have the skills and ideas and want to implement them straight away. The UK needs to change or be left behind the new global start-up powerhouses.

COMMENT PIECE

TOBY COPPEL, partner Virgin Green Fund

Whatdoes Israel’s technology scene mean for the UK? The British government’s recent White Paper on economic growth called for a “stronger partnership between British and Israeli companies to exploit the potential synergies between Israel’s high levels of innovation and British strengths in design, business growth and finance.”

This is the core of what the future partnership between the UK and Israel should be, matching the innovation and technological brilliance of Israel, the “start-up nation”, with Britain’s skill and experience in building large successful companies.

Outside of Silicon Valley, Israel is the high-tech capital of the world. In addition to boasting the highest density of start-ups in the world, more Israeli companies are listed on the NASDAQ than companies from the whole of Europe. With per capita venture capital investments in Israel being 2.5 times greater than in the US and 30 times greater than in Europe, investors are turning to Israel in increasing numbers to take advantage of exciting new opportunities.

It is home to the research and development facilities of over 60 major multinational companies, including Google, Microsoft, HP, Apple and Intel.
So, how is Israel punching so far above its weight? In less than a decade, Israel’s world-class high-tech economy has flourished, built on the strong foundations provided by world renowned academic institutions, a series of astute government initiatives, the relationship between the army and the private sector, access to foreign capital and a culture that rewards success and innovation.

Israel spends about five per cent of its GDP on research and development — double that of the UK. It has eight universities which feed directly into businesses as well as through various funding programmes, set up and co-ordinated through Israel’s Chief Scientist’s Office. This unique department is responsible for allocating much of the government’s financial support, and is a key facilitator in helping Israel’s plethora of start-up companies find their feet in a competitive business marketplace.
The Israeli entrepreneurial culture is also a key factor, where failure carries no stigma, and everyone seems to live for today. It is no surprise then that in 2011, Israel had over 3,500 tech start-ups, the highest number outside of the US.

These companies are supported by Israel having the highest venture capital (VC) per capita ratio in the world and a successful history of profitable exits and sales to foreign multi-national companies, including the recent acquisitions of Anobit by Apple, Worklight by IBM and Snaptu by Facebook.
It is clear that for investors looking to capitalise on a developed market with the yields of an emerging one, Israel is definitely the place to be. It is also evident that to take their product to a global audience, Israeli companies require foreign capital and partnerships.

Innovate Israel has provided a platform to do just this, allowing UK and European partners to directly target Israeli technology companies looking to expand into Europe, by clearly sending out the message that the UK is open for their business.

Toby Coppel is a partner at Virgin Green Fund, and the former managing director of Yahoo! Europe. He was one of the speakers at Innovate Israel

DANIEL SEAL, chief executive of UK Israel Business

It is no secret that the UK government wants to create a digital economy and form tech clusters around the country. It is important however that we do not force this to happen prematurely — it has to evolve.
The Israel tech community grew organically from the military and defence industries, and the post-Holocaust entrepreneurial spirit; Silicon Valley grew from the convergence of skills between Stamford University and the US military Research and Development (R&D) programmes.

Areas such as London’s Silicon Roundabout cannot grow overnight. We have to convey the message that occasional failure is good — if you learn from it. As Sir Winston Churchill said: “Success is the ability to go from one failure to another with no loss of enthusiasm.” It is this confidence and resilience that the UK needs to embrace.

And if the government is serious about creating a digital economy and a “start-up Britain”, changes need to be made at the grassroots.

We need to modernise our education system so that the next generation leave school with transferable IT skills. These include the ability to code and design websites, in addition to practical business management skills.
The UK has some of the best branding and content creation talent in the world, and with a large domestic market, is in a great position to partner with Israel technology companies, who in turn require the knowledge of UK entrepreneurs to commercialise their innovations. However, we are not quite ready to make the most of this opportunity.

The present government still needs to work on dismantling the bureaucratic barriers hindering business growth, and creating more incentives for investors to invest in start-ups.
The aim of Innovate Israel was to create a platform for this partnership, by bringing over 35 young and exciting Israeli digital companies and entrepreneurs and connecting them with suitable investors and counterparts.

This is the first time an event of this size has taken place in the UK, and is a small step in helping the UK’s digital economy grow, and delivering business opportunities for all.

Daniel Seal is chief executive of UK Israel Business, organisers of Innovate Israel and the British Israeli Awards dinner

    Last updated: 2:49pm, June 28 2012