Palestine's tech & startup industry bleeding amid Israel War

The Israel-Hamas war has had a significant impact on Palestine’s tech and startup industry, which had been growing despite Gaza being one of the most economically challenged regions in the world. Several top-notch companies had emerged from this region, demonstrating the resilience and innovation of the local tech ecosystem1.
Investments in the Palestinian tech ecosystem have been substantial, with estimates suggesting that as much as $10 million has recently been invested1. This investment has helped foster a vibrant tech scene, with numerous startups and tech companies contributing to the local economy.
In 2017, Salesforce founder and CEO Marc Benioff backed the creation of the first-ever coding academy in Gaza1. This initiative was a significant step towards nurturing local talent and providing them with the skills necessary to thrive in the global tech industry.
The ‘Gaza Sky Geeks’ initiative, backed by Alphabet, has been instrumental in supporting the Palestinian tech ecosystem1. It provides pre-seed investments, training, and technology resources to Palestine’s Gazan population3. Since its establishment as a joint venture between Google and Mercy Corps in 2011, it has helped thousands of young people earn life-sustaining income.
However, it’s important to note that while the Palestinian tech ecosystem is still small, it has been growing over the past 15 years. The majority of existing tech businesses provide outsourcing services, mostly to local companies, while some also outsource to regional and international businesses and organizations. This growth signifies the potential of Palestine’s tech industry despite the challenges it faces.

In 2022, 5,000 coders and developers from across the West Bank and Gaza graduated from the programmer.

Ibtikar, one of the main Palestinian VC funds, recently raised its second fund of $30 million.
High-growth companies emerging from Palestine include Menalytics (data analytics, invested in by Flat 6 labs); Olivery (last mile logistics, Flat6Labs and Ibtikar Fund); Coretava (employee and customer loyalty); and Sellenvo (an Amazon fulfillment partner).

Iliana Montauk, co-founder and CEO of social impact startup Manara, funded by Y Combinator and others, was quoted as saying that Gaza has been bombed many times before but “this time is completely different for the tech sector for several reasons”.

“Electricity was cut off to the entire Gaza strip. A significant amount of infrastructure has been bombed (including both ISPs and many tall apartment buildings that hold cell phone towers). Entire middle-class neighbourhoods are being destroyed,” she told TechCrunch.
“The tech sector is almost completely unable to function in Gaza right now,” she added.
Manara has around 100 software engineers in Gaza, some working remotely for tech companies in Silicon Valley in the US and Europe.

Most people have lost cell phone connections and internet access completely, or have some access to 2G only on their cell phones. Mohammad Alnobani, founder of The Middle Frame, an Arab stock image platform powered by AI tools, was quoted as saying that “dealing with the situation while trying our best to move forward with our work is a daily challenge.”

Meanwhile, the Israel Defense Forces (IDF) has said it has been completing preparations for a "significant ground operation" in the Gaza Strip. Tens of thousands of Israeli soldiers were being deployed at the border of Gaza in anticipation of a large ground operation, reports said on Sunday.

According to health authorities in Gaza, more than 1,900 Palestinians have been killed and nearly 7,700 wounded by Israeli airstrikes. Israel said more than 1,300 people were killed during rocket attacks and deadly raids into territory by fighters from Hamas.