Wall Street Buyout Veteran Seeks to Boost North Israel Economy
This story first appeared in Bloomberg Terminal
By Yaacov Benmeleh
(Bloomberg) — A 30-year veteran of Wall Street takeovers and turnaround jobs is taking a crack at his next challenge: Boosting the economy of northern Israel.
Bradley Bloom, who founded Berkshire Partners LLC, a Boston-based private equity firm that manages about $19 billion in assets, recently was chosen to chair the board of governors of the University of Haifa, a school perched atop a mountain less than 30 miles from Lebanon. Bloom will oversee a plan to invest millions of dollars in math and science programs and develop a new campus wing closer to the city center.
The goal is to give young people in the area another option besides the Technion — Israel Institute of Technology — a vaunted institution often called “Israel’s MIT” — to get trained for a modern economy.
“There’s plenty of people engaged with the Technion, an extraordinary institution,” Bloom, who is now a senior adviser to his firm after stepping down as managing director in January, said. “The University of Haifa is obviously less developed, but also has tremendous potential.”
While many modern economies are starved for technologically skilled workers, the problem is especially acute in Israel, where its tech sector has outsized importance. The industry generates 45% of exports and provides work for scores of local advisory firms.
‘Crummy’ Early Education
To help fill the gap, economists recommend more investment in secular education for minority communities such as Orthodox Jews and Arabs. Most of Israel’s Arab community resides in the north of the country.
Though welcome, investing more on the university level doesn’t address the root problem of Israel’s under-educated children, according to Dan Ben-David, head of the Shoresh Institution for Socioeconomic Research at Tel Aviv University. About half the country’s students receive what he called a “third-world” education, with the proportion even higher among Arabs and ultra-Orthodox Jews.
“The primary schools are really crummy, which means that kids reach high school and can’t study math and English at the highest levels, much less enter a research university,” Ben David said. “It would be great if Haifa University succeeds, but do they have a backup plan that brings everyone up rather than dumbing down the school?”
‘A Lot of Momentum’
The university has secured more than $60 million in donations the past two years, funding projects that include an artificial intelligence center.
Haifa is Israel’s third-largest city, with about 280,000 residents, and hosts offices of tech giants such as Amazon.com Inc., Intel Corp. and Apple Inc. Yet its location an hour away from Tel Aviv cuts many residents off from work opportunities in Israel’s economic center.
Household income in Haifa ranks in the bottom half of the country’s 15 largest municipalities, according to the Central Bureau of Statistics. Many nearby Arab communities are worse off than that.
“The north and Haifa haven’t gotten as much attention,” Bloom said. “But there’s a lot of momentum thinking about the future. These things take years, if not decades, to happen.”