by Marilyn Silverstein
NJJN Bureau Chief/PMB

October 7, 2008

Ten Israelis are on the list of the world’s richest billionaires, and the Jewish state now has some 10,000 millionaires, said Cliff Goldstein, president of Amidex35.

“These are serious people making serious money,” said Goldstein, whose Willow Grove, Pa.-based fund is the only registered index mutual fund in the United States investing exclusively in stocks of Israeli companies.

“Israel is young. It’s vibrant. It’s entrepreneurial. It’s creative. It has chutzpa,” he said. “But don’t forget the most important thing: It has money. It has oodles of money. It’s the brain power and the entrepreneurial ability coupled with cash.”

More than 100 people attended Goldstein’s remarks at Princeton’s Nassau Inn on Sept. 18 — people with an emotional investment in Israel who were there to consider the wisdom of making a financial one.

The occasion was Israel’s Financial Market: A Unique Opportunity for Investors, an Israel@60 event jointly sponsored by the United Jewish Federation of Princeton Mercer Bucks, New Jersey-Israel Commission, and Central Atlantic Region of the America-Israel Chamber of Commerce.

The wine-and-networking reception featured two other speakers — venture capitalist David Anthony, managing partner of the New York-based 21Ventures, a venture capital fund that has committed some $130 million to investments in seed and early-stage Israeli technology companies, and Zvi Chalamish, chief financial officer for the Government of Israel Economic Mission, Israel’s key liaison to the U.S. investment banking and credit-rating community.

Adam Zellner, director of policy for the office of Gov. Jon Corzine, served as moderator.

“We’re getting the message out to people about Israel and what Israel offers as a financial market and a market of innovation and technology, and what that means for investors and for states like New Jersey,” said NJIC executive director Andrea Yonah, as guests mingled and shmoozed before the program.

The event would further that goal, she said, “from the government and financial end and from the technology end.”

Rysia de Ravel, federation’s vice president for Israel and overseas and chair of the community’s Israel@60 celebration, noted that there is a whole lot more to Israel than the Middle East crisis.

“There are all these areas where Israel is vibrant and exciting,” said de Ravel, “and we want to use the Israel@60 year to celebrate all those areas where Israel is performing outstandingly. Today, when the U.S. economy seems to be very shaken up, it’s very opportune to look at all the wonderful investment opportunities in Israel.”

Federation executive director Andrew Frank also pointed to the Israel@60 observance as a celebration of Israel’s diversity. “What we’ve been trying to demonstrate is that Israel is a country of many different aspects,” Frank said. “It’s not only the Israel you read about in the paper, and it’s not only the Israel you read about in the Bible. It’s Israel at the top of its game economically. We want to introduce people to elements of Israel they’ve never thought about before.”

The technology end is Anthony’s priority. “To me, the heart of the Israeli economy is its technology ecosystem,” he told the gathering. “Regardless of how the lines are drawn, regardless of what party is in power,” he said, Israel’s future success will be dependent on its technology ecosystem. “That’s what will make Israel thrive for the next 60 years,” he said.

There are a number of reasons why he invests in Israel, Anthony said — first and foremost, Israel’s brainpower, but also its Chief Scientist’s Office, which has invested $400 million in technology start-ups; its rule of law, which protects intellectual property; its “bootstrap” culture, which fosters the entrepreneurial spirit; its strong spirit of teamwork that derives from military service; and its $12 to $13 trillion economy.

“Those are six wonderful reasons why I have over $130 million invested in Israeli start-ups today,” he said. “To me, Israel is perfectly positioned at the crossroads of where the global economy is growing.”

What’s up

Chalamish was on hand to attest to the strength of the Israeli economy. “Despite the global slowdown, our economy has shown impressive growth,” he said, noting that overall growth has been up 5.3 percent in the past year.

“Exports are up 12 percent, the shekel is very strong against the euro and the dollar, and we have a surplus in our budget,” Chalamish said. “The only things that are down,” he added with a smile, “are unemployment and my salary, because I get paid in dollars.”

For Goldstein, the question, in 1998, was how to get involved in the excitement of Israeli companies without being a venture capitalist. His answer was the Amidex35, which invests in the 35 largest Israeli companies traded on Wall Street or in Tel Aviv, allowing investors exposure to both blue-chip traditional companies and innovative technology companies.

“I decided that indexing was the way to go,” he said. “If you want to buy Israel, buy the whole country. So we created an index that represents 35 companies that are representative of the entire Israeli universe.

“How has the Amidex35 done? It’s done well,” he said. “We’re up about 75 percent over the last five years.” Even after the economic crisis of the past year, the Amidex35 continues to be up 75 percent, he added. “We’re the best-performing international mutual fund over the last five years,” he said.

Ferrying the Amidex35 toward that success has been a fulfilling and exciting experience, Goldstein said in a separate interview.

“I’ve done 100 or so of these outreach efforts all over the country,” he said, “and I’m always fascinated by one common theme — the level of surprise in the audience when you explain just how successful Israeli companies have been.

“The job will be done,” he said with a smile, “when people say, ‘I knew that.’”

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