The Evolution of a New Industry by Drori Israel;Ellis Shmuel;Shapira Zur;

Author:Drori, Israel;Ellis, Shmuel;Shapira, Zur;
Language: eng
Format: epub
Publisher: Stanford University Press
Published: 2013-08-15T00:00:00+00:00

Figure 4.1

Telrad’s genealogy: Founded firms by generation

In sum, the three or four decades of its evolution as part of Koor provided Telrad with a stable institutional environment and a secure market. Furthermore, Telrad hardly invested in R&D beyond the direct needs of its institutional clients and faced a competitive market only during the 1980s, when the Israeli economy underwent a process of liberalization and privatization. Note that, although Telrad went through continuous crises in the 1990s and many engineers left the company, very few among them directed their energy and knowledge toward entrepreneurial activities.

Tadiran

The distribution of firms within the Tadiran genealogy according to affiliation type is presented in Exhibit 1. Table 4.2 displays the frequency of de-novos as a function of founding year and generation. The interrelations structure of the whole genealogy is presented in Figure 4.2.

The prominent growth of Tadiran during the 1970s and early 1980s (see Chapter 3) was not reflected in the growth of its genealogy. Before 1988, the firm did not establish new ventures and acquired only three firms, Mavletan, Simtech, and Telco. Telco was slated to be given by Koor to Telrad, but accidentally found its way to Tadiran and, ultimately, facilitated Tadiran’s entrance into the communication sector. Note that only one start-up (de-novo) was founded by a former Tadiran employee before 1990. The genealogy expanded mainly through new divisions (that were later spun off and sold) or by M&As for knowledge acquisition and market penetration (such as Media Gate and Elisra). Furthermore, the majority of the spinoffs were outside Tadiran’s core business, and during the early 1990s, when Tadiran experienced financial and business crises, those spinoffs were first sold as part of restructuring and cost cutting. In fact, the basic skeleton of the Tadiran genealogy comprises the founding parent and its spinoffs that had been established earlier as divisions or initiated in preparation for being sold to external acquirers.

Table 4.2

Tadiran’s genealogy: Distribution of de-novos as a function of generation and founding year

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