Israel Tech Leaders, Irked by Netanyahu, Eye Moves Into Politics

(Bloomberg) -- Frustrated by Prime Minister Benjamin Netanyahu, some Israeli business leaders are considering entering politics. They’re holding discreet, if preliminary, discussions about options, including forming a new party, running candidates on existing lists or volunteering for key jobs in major ministries.

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Separately, a forum of Israel’s top 200 business leaders, comprised of owners, chairs and chief executive officers of major companies, is calling for early elections “to save Israel from a deep economic crisis.” Half the companies listed on the Tel Aviv Stock Exchange’s TA-35 index are represented, including the CEOs of the four largest banks.

The war against Hamas is straining the Israeli economy. The central bank estimates the conflict will cost around $67 billion through 2025, or almost 15% of annual gross domestic product. GDP per capita dropped in 2023 for the first time in eight years, according to the International Monetary Fund, and the government’s on track to run one of its largest budget deficits this century in 2024.

Businessman Eyal Waldman, who’s part of the forum, was an advocate for Israeli-Palestinian peace before Oct. 7 but avoided overt political activism. Then Hamas attacked. His daughter Danielle, 24, and her boyfriend were murdered at a festival in southern Israel in the deadly invasion that killed over 1,200 and set off the Gaza war. Now, Waldman says, he has a new mission: Overthrowing Netanyahu.

“What I’m working on now is moving up the elections,” he said in an interview. That includes trying to persuade lawmakers in Netanyahu’s government to defect and bring down the coalition. “The current government is the enemy of the state.”

Waldman hasn’t ruled out running for political office. “If we need to and this is the only option, then maybe yes,” said the Israeli tech veteran, who sold his company Mellanox to Nvidia Corp. in 2019 for nearly $7 billion.

Among those who’ve attended the discussions and who are said to be considering a political role from within the tech world are Pitango’s Chemi Peres, the son of former President Shimon Peres; Papaya Global chief executive officer Eynat Guez; and Izhar Shay, a partner in the Disruptive AI venture capital firm. Shay is a former science minister whose soldier son was also killed on Oct. 7. Wiz’s chief executive officer Assaf Rappaport has also been approached.

Peres and Shay declined to comment on the record. Guez said she views the current discussion as theoretical, but might consider it in the future. A spokesperson for Rappaport said he’s not associated with the movement.

This article is based on accounts of six people familiar with the discussions who spoke on condition of anonymity to protect their business relations and interests.

The forum of business leaders said in an open letter published last week that early elections are needed as “an indisputable vote of confidence, by a majority of the public, in its elected officials.” It warned that Israel’s future is endangered.

While the tech world is politically diverse, many have found common cause in seeking to oust Netanyahu and improve public service. They’ve unified around the concern that the government is spending too much on Jewish settlements in the occupied West Bank and on the ultra-Orthodox while failing to mandate military service for religious students.

Elections are not scheduled until 2026, but opposition leader Benny Gantz’s departure from the government this month and infighting over the handling of the war against Hamas and ultra-Orthodox conscription have increased talk of an early vote. Weekly demonstrations seeking elections have grown to more than 200,000.

Even if elections are held, there’s no guarantee of a definitive outcome with such a polarized electorate. Between 2019 and 2022 Israel held five rounds of elections and had just two short-lived coalition governments.

Some have raised the possibility of joining forces with former Prime Minister Naftali Bennett, an entrepreneur who briefly oversaw a coalition made up of left-wing, right-wing and Arab parties opposed to Netanyahu. Bennett, who has kept a high public profile since the war, hasn’t said whether he’ll reenter politics. A spokesperson didn’t respond to a request for comment.

Israel’s business community had a political awakening last year, when tech executives were at the forefront of protests against Netanyahu’s plans to weaken the Supreme Court. The proposals were largely abandoned after the Oct. 7 attack and after the court itself intervened.

Since his daughter’s murder, Waldman has met with top US officials, including President Joe Biden, as well as UK Foreign Secretary David Cameron, he said. The US officials expressed frustration with Netanyahu’s government, he said, though the prospect of replacing him wasn’t explicitly mentioned. “They understand they can’t work with this government,” he said.

Nadav Shtrauchler, a strategic consultant who has worked closely with Netanyahu, said the prime minister isn’t concerned by the emerging tech political movement. “It’s not his base, it’s far from his base,” said Shtrauchler.

He predicted Netanyahu would say to his working-class, right-wing supporters: “You see those guys come with a huge amount of money, but I have you guys.”

--With assistance from Lynn Doan.

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