Opinion
Don't blame the shekel: Israeli talent is the asset you can't offshore
As layoffs ripple through Israeli tech, companies blaming macroeconomics are missing the point. The real asset in this country isn't a currency position. It's a concentration of talent that can't be re-created by chasing a cheaper time zone.
Every wave of layoffs brings the same chorus. The shekel-dollar rate, the cost of local engineering, the appeal of offshoring. None of these arguments are wrong on the spreadsheet. They're just minor. The exchange rate moves a few percentage points in a quarter. The value of an engineer who can ship under pressure, find a solution nobody else saw, and flatly refuse to settle for mediocrity moves the entire business. Only one of those is worth optimizing for. The other is noise.
Where the talent comes from
Israeli talent doesn't start in a coding bootcamp. By their early twenties, most Israelis have already spent years operating under real pressure, with real consequences, and with resources that were never enough. It doesn't matter much whether they served in an elite technology unit, as a tank commander, or as a naval officer. The lesson lands the same way: deliver the mission with what you actually have, give and take blunt feedback in real time, and own the result when it's on you.
That's why the comparison with other markets comes out so lopsided. An Israeli's development curve is steep and early, which pushes people in their twenties to a level of judgment and ownership that their peers abroad often reach only in their late thirties. Now multiply that across an entire ecosystem. What you get is something almost nowhere else has: a dense cluster of high-caliber people packed into a country the size of New Jersey.
Also the unique Israeli work culture, which runs on openness, is a major factor. Criticism is direct and unfiltered, even when it stings, because the point is to land on the right answer rather than to protect anyone's feelings. There's also a particular kind of camaraderie here, the reflex of people who have already worked shoulder to shoulder toward one objective, whether in the army or the youth movements. And underneath all of it sits an obsession with getting better, and something close to physical discomfort at the idea of being average.
Put those together and you have an edge that's worth far more than any swing in the exchange rate. And in the AI era it matters even more, not less. When a model can write the boilerplate, what's left is the hard part: knowing what to build, catching the wrong answer before it ships, and owning a problem end to end. That's exactly what this culture produces. It's why teams are getting smaller and more focused, built around a handful of people with a “big head,” and why the smart companies keep concentrating their best people in Israel rather than thinning them out.
So, how to win in Israeli tech?
If you want to do well here, the playbook isn't complicated.
Go deep - Don't be satisfied with making something work. Understand, end to end, why it works. That depth is the one thing no downturn can take away from you.
Improve relentlessly and treat your own growth as a number you track. The version of you a year from now should be barely recognizable to the version reading this. That curve is your real edge, so protect it.
Take the culture seriously – Own your work end to end, never quietly hand off the hard part, and help the people next to you. We're all pulling toward the same goal, and the people who lift their teammates are exactly the ones every good company is desperate to keep.
The market will correct, the way it always does. When it does, the people who kept sharpening themselves through the slow stretch won't be competing on the exchange rate. They'll be the reason companies come back to Israel in the first place.
Ofir Nir is the VP of R&D at Vega.
