From Startup Nation to Open Innovation Nation : The Evolution of an Open Innovation Ecosystem in Israel

This paper investigates the development of an open innovation (OI) ecosystem in Israel by analyzing the evolution of OI activities, processes, functions, and practices in the Israeli entrepreneurial ecosystem from 1993 to 2022. Our findings show a movement from internal patterns of innovation towards widespread open patterns of innovation in the ecosystem through three distinct phases. During Phase 1 (1993-2003), the Israeli ecosystem experienced sporadic OI activities with low-intensity and limited scope. In Phase 2 (2004-2014), OI activities became more structured, specified, and diverse, with a significant increase in the number of firms conducting OI activities. In Phase 3 (2015-2022), there was a significant increase in the number of firms engaged in OI activities, with OI activities becoming much more systematic, and Israel becoming a hub for global OI centers.The study highlights the significant role of OI activities by established firms in the ecosystem's success, adding to the analysis of entrepreneurial ecosystems. Our research indicates that during the last two decades, innovation efforts have shifted away from a mostly startup-driven model to a more collaborative system between startups and corporates, with the latter becoming more dominant in the OI process. This shift is due to corporates adopting a more deliberate OI strategy and integrating various OI activities, processes, functions, and practices into structured innovation funnels with well-defined goals and KPIs. The study provides valuable insights into the development of entrepreneurial ecosystems and can guide policymakers, entrepreneurs, and researchers interested in understanding the dynamics of such ecosystems