Ready for a tongue-twister? Sagi Shahar is an entrepreneur based in the startup nation, whose startup helps other startups grow their ventures by pairing them with other entrepreneurs who work in the startup nation’s top startups.
But Shahar maintains that no matter how many times the words “startup” and “entrepreneur” applies to Israel, the unfortunate fact is that the application of these words is often limited to big businesses and non-governmental organizations (NGOs) in the center of the Jewish state, often leaving out NGOs and small businesses in the periphery. His startup, Nachshonim, solves this very problem.
“At Nachshonim, we want to build an army of talented young professionals who bring the startup nation to every corner of the country,” he told JNS. “We want to bring our support, ingenuity and innovation to places and people who need it the most, but can’t afford it.
“At the same time, we want to build a second army of people building a social career alongside their businesses career for the long term,” he continued, to ensure better leaders with broader perspectives that will impact Israel.
Nachshonim, therefore, helps grow small businesses and NGOs in Israel’s periphery by pairing small-business owners and NGOs with a “dream team” of the country’s best young talent—from companies such as Google, McKinsey and Microsoft. These 150 “fellows,” who average about 28 years old, help small companies grow and become self-sustainable, and in turn, advance their own careers by tackling problems head on from an executive point of view.
“For the fellows, it enables them to do something outside of their day job that provides new value, both for themselves and for society,” said Shahar. “They advance their career through world-class training on problem-solving in different sectors and apply their new skills in real life. They tackle problems from different perspectives and network with the best talent in the country—all while getting an opportunity to make real impact and something meaningful.”
For the small businesses and NGOs, the fellows add infrastructure and support, which are intended to help their businesses grow, boosting the Israeli economy and society. Some “99.5 percent of all businesses in Israel are small businesses,” stated Shahar, “and most are located in periphery but do not have equal opportunity to succeed.”
Moreover, he added, “90 percent fail in five years. They are the infrastructure of the country, but little efforts are being provided to support them. We saw that periphery business owners don’t have basic elementary infrastructure that a business owner in Tel Aviv has. They need to overcome so many more obstacles to get the same rate of change to succeed; some don’t even have a bank account, don’t know how to manage revenues or have proper language skills. So we provide direct scaling help to these small businesses with bottom-up impact.”
‘New source of self-generated revenue’
According to Nachshonim, the results from the work of the fellows can clearly be felt in the organization’s first pilot projects in the Israeli city of Lod.
One of the small businesses Nachshonim helped there is Amany Studio Nail Art, a nail salon that started in the home of a young Arab-Israeli woman. Just one year after beginning to work with Nahshonim, Amany’s salon increased revenues by 40 percent, added more services to its offering and opened its first location. To date, Nahshonim fellows have invested 20,000 hours in 80 small businesses, resulting in a combined $10 million growth in beneficiaries’ revenue.
“If we help one small business thrive, we can change a family. If we can help five businesses in one location, we can help a neighborhood. But when we help 50 businesses in one city thrive, we can start to change a city,” declared Shahar. “We believe we could change the entire ecosystem of that community.”
Nachshonim also works with the nonprofit organization, Natal, the Israel Trauma Center for Victims of Terror and War. In addition to helping Natal generate its own revenue, Shahar’s company worked with them to build a training program to increase resiliency in communities affected by trauma. So far, Natal has partnered with Chicago, New York and Berlin, who have sent teams to Israel to get hands-on experience of Natal’s methodology.
According to Shahar, “50 percent of the social sector’s budget comes from the government.” As such, “we are trying to support them to create new sources of income. We helped Natal build a new source of self-generated revenue, not dependent on government or philanthropy.”
According to Orly Gal, Col. (res.), the executive director of Natal, before Nachshonim helped its program and budget, 70 percent had come from donations and 30 percent from selling services. After Nachshonim’s help with Natal’s newly developed program set to launch in October, the business hopes to increase its income from services by another 30 percent.
The new program will offer seminars and training in Israel every year for officers of municipalities, teachers, first responders, social workers and health-care professionals to better treat PTSD within their communities, especially following emergencies and disasters. Natal is already working with various American organizations and communities, such as the Wounded Warrior Project, to help veterans from Iraq and Afghanistan, with African-American communities in Chicago and hospitals in New Jersey.
“The work Nachshonim did with us was very special and very professional,” said Gal. “We plan to use the money we get from this program to take care of the people who need support the most.”