An MIDC Milestone

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Marvin Schapiro understood that the Baltimore Jewish community could help build a strong and vibrant Jewish state by helping its economy grow.

Unprecedented high hopes took hold for Schapiro, a Baltimore native who died at the age of 82 in 2002, when, in the mid-1980s, he decided to invest in an Israeli company that made drones.


“I don’t think he made any money on that investment,” his grandson, J.M. Schapiro, said, “but it’s funny to look back at how ubiquitous drones have become. And to think back 35 years ago that he had this vision is truly incredible.”

In the late 1980s, right around the fall of the Soviet Union, an influx of Russian Jews to Israel led to double-digit unemployment numbers and hyper-inflation in the Jewish state. In response, then-Maryland Gov. William Donald Schaefer signed the Maryland/Israel Declaration of Cooperation in 1988, an economic development partnership that both sides continue to reap the benefits of to this day.

One of the biggest developments that came as a result was the Maryland/Israel Development Center (MIDC), a nonprofit organization Marvin Schapiro and other Baltimore Jewish community leaders and business executives formed in 1992.

And on May 7, the MIDC will commemorate its two-plus decades of connecting Maryland and Israeli companies with a 25th anniversary party at the Baltimore Museum of Industry.

“He clearly would be proud of the entrepreneurial spirit of the MIDC,” said J.M. Schapiro, who will represent the Marvin Schapiro Family Foundation as the event’s lead sponsor. “Anytime you start something and it’s around 25 years later prospering, what more could you ask or hope for with something a lot of people had no idea would pan out?”

Bogage’s Vision

Established in partnership with the Maryland Department of Business and Economic Development, Israel’s Ministry of Industry and Trade and The Associated: Jewish Community Federation of Baltimore, the MIDC promotes bilateral trade and investment between Maryland and Israel.

Barry Bogage (Photo provided by The Associated: Jewish Community Federation of Baltimore)

Barry Bogage, 59, the MIDC’s founding executive director, said the goal of his organization when it started was to create jobs. The Pikesville native said he has always considered the MIDC “a matchmaker,” not of a romantic kind, but of an economic one.

“To be able to expand from a one-person to four-person operation has been huge, especially when we have one of those people working in Israel,” Bogage said. “We really try to pull out all the stops, because the Israeli companies really appreciate those little things.”

To mark his contributions, Bogage will be honored with the Hanan Y. Sibel Maryland/Israel Business Leadership Award for 25 years of dedication and professional excellence. Gov. Larry Hogan, who completed his first trade mission to Israel this past September, will also deliver remarks to celebrate Bogage and the MIDC for their contributions to the business community.

Alvin Katz, 74, a board member of the MIDC who is charing the silver anniversary celebration committee, said Bogage has been a visionary in terms of growing Maryland’s economy with a focus on Israel.

“Under the leadership of Barry, I think the organization has continued to thrive and expand and evolve in ways many of us could have never envisioned. It really makes me stop and think about how far it has come,” said Katz, who is in his second stint on the board after holding a seat from 1992 to 1995.

Bogage brought a wealth of domestic and international experience to the position. He held economic development positions with Wales-based Welsh Development Agency, the Howard County Department of Economic Development Authority and the Prince George’s County Economic Development Corp. before joining the MIDC.

As Israel has become known for its robust startup culture in the high-tech fields of cybersecurity, biotechnology and life sciences, Bogage said those industries have relied heavily on connections with the United States.

Maryland, with its close proximity to Washington, D.C., and federal government offices such as the Food and Drug Administration and the National Institutes of Health, has made itself an intriguing option for Israeli companies, he added.

“We find companies in Israel that have some common market interests and some common technological interests that make it valuable for them to collaborate,” Bogage said. “We have great assets to offer with institutions like the National Institutes of Health, Johns Hopkins University and the University of Maryland. I think those factors are among our biggest selling points of why these companies would want to do business in Maryland and the U.S.”

Gov. Larry Hogan was part of Barry Bogage’s sixth trade mission to Israel that included a stop at Elta Systems, one of Israel’s leading defense electronics company. (Photo provided by Executive Office of the Governor/Anthony DePanise)

Today, more than 30 Israeli companies are part of the MIDC — many of which have offices in the state — and every Maryland governor in the last 25 years has visited Israel for trade missions.

This past September, Bogage organized his sixth trade mission for a Maryland governor or lieutenant governor, joining Hogan on stops through Tel Aviv, Beersheva and Jerusalem, among others.

In 2015, the most recent year for which data is available, Maryland was Israel’s 43rd-largest trading partner with $145.1 million in product exports, according to Hogan’s office.

Hogan, a Catholic, said in a prepared statement through spokeswoman Shareese DeLeaver-Churchill that any good marketing strategy that attempts to lure Israeli companies to Maryland takes a concerted effort. As a result, the governor, a Republican, added that Maryland and Israel have thrived in both financial and diplomatic relations.

“Over the past 25 years, the Maryland/Israel Development Center has helped position Maryland as the ideal location for Israeli high-tech companies and investment,” Hogan said. “We look forward to their continued partnership as we grow Maryland’s economy and create new opportunities for our citizens.”

Setting Up Shop

When Israeli companies first launch in Maryland, an incubator program offered through counties, universities and the state itself provides a small workspace to help get operations off the ground, Bogage said.

In other cases, companies such as Medispec, a Germantown-based subsidiary of a Tel Aviv-based company with the same name, start their operations out of the home of an employee.

“We had to be very savvy and creative when we first started in the U.S.,” said Anil Dhingra, chief operating officer and vice president of Medispec, which specializes in manufacturing equipment to break up kidney stones using shock waves. “We would have come to Maryland if we didn’t know about the MIDC, but I think we would have had a lot more challenges in getting to where we are now.”

Dhingra, 51, said his company has experienced “massive growth” since launching its U.S. operation out of his apartment in 1996. He has occupied four different office spaces — with each one being bigger the previous location — and now has a staff of 20 employees.

Steve Dubin (Photo provided by The Associated: Jewish Community Federation of Baltimore)

Steve Dubin, 63, chair of the MIDC board, said he offers any advice he can to put a company in the best possible position to succeed.

“It’s a hand-holding functioning, so whatever these companies need to be successful, we at least try to point them in the right direction,” Dubin said. “We have a group of people offering their services to these companies of who to trust as far as getting mentoring and legal and financial advice.”

Dhingra said the support he received from the MIDC went a long way in helping secure leases for office space, establishing lines of credit with multiple banks and hiring trustworthy employees.

“When you are opening shop in the U.S., it is very hard to do anything,” Dhingra said. “So Barry made those things so much easier when we decided we were coming here.”

R. Michael Gill, state secretary of commerce, said in a prepared statement that the Israeli and Maryland governments have much in common. He said the workforce in Maryland parallels what is strong in Israel.

“[The MIDC] has created new job opportunities for Marylanders and helped Israeli companies succeed in the U.S. market,” Gill said. “Working together with the Maryland Department of Commerce, the MIDC has been an outstanding partner.”

Israel’s strong cybersecurity sector has also made it a good match for employment opportunities with Maryland.

Bruce Spector said the MIDC helped his Pikesville-based company, Electronic Technology Associates (ETA), broker a deal to join forces with Elbit Systems, the largest defense company in Israel.

“Barry introduced us to the major players, so if it wasn’t for him, we wouldn’t have the opportunities with Elbit Systems like we do now,” Spector said.

Spector, 60, founder and CEO of ETA, opened the Maryland Cybersecurity Range with Cyberbit, a subsidiary of Elbit Systems, on April 10, nearly seven months after accompanying Bogage and Hogan to Israel. He said he is in the process of applying for a $250,000 grant with the state Department of Labor, Licensing and Regulations to help increase his staff from 12 to 25 by year’s end.

The range, located in Baltimore, is the first standalone, hands-on cybersecurity training center in the country, according to Spector. Its main purpose, he said, is to instruct cybersecurity professionals in protecting national assets and infrastructure against cyberattacks and to offer high-paying jobs for Marylanders.

“The Israeli economy is so robust, and Bogage’s access to getting us to Elbit and Maryland state leaders has really expedited our success,” Spector said.

Looking to the Future

Gov. Larry Hogan and Israeli Deputy Minister of the Interior Meshulam Nahari sign a sister state agreement between Maryland and the Negev region in Israel. (Photo provided by Executive Office of the Governor/Steve Kwak)

But the MIDC has not gone without its share of challenges throughout the years, navigating the dotcom bust of the early 2000s and the Great Recession later that decade.

At its peak, the MIDC had partnerships with 48 companies, a number Bogage hopes the organization can surpass in the not-too-distant future.

“The future is strong,” Bogage said. “We continue to meet with a lot of companies, and we’re out meeting with them all the time. We don’t have an empire, but the fact that we have been able to grow our staff and operations the way we have has really allowed us to cover a lot more ground.”

To further support Israeli innovation, the MIDC set up a for-profit subsidiary, Maryland/Israel Development Corp., in 2011 through its partnership with Israeli consultant firm Treadlines.

The MIDC raised $4.25 million to establish the for-profit arm, Bogage said, investing in 12 Israeli high-tech startups through a venture capital fund. Bogage said he is confident that the MIDC will have a proven track record within “the next couple of years” to create a second fund.

“Out of the 12 investments we made, only three have busted so far,” Bogage said. “Three have been successes, and six are moving ahead with their product development, so we’re really pleased with how this venture has turned out.”

The organization has also provided small business loans to Ashkelon, which has a sister-city relationship with Baltimore through The Associated, for about the last 10 years, Bogage said.

After air strikes from the Gaza war shut down Ashkelon for nearly two months in the summer of 2014, Bogage noted “an emergency small business loan fund” was created through the MIDC to help companies recover.

“These are small mom-and-pop companies, so it’s not like we are giving grants to a Coca-Cola plant or some other majors companies in Ashkelon,” Bogage said. “It’s impossible for a company that was closed for 50-something days to weather that unscathed.”

The MIDC’s 25th anniversary celebration is May 7 at the Baltimore Museum of Industry, 1415 Key Highway East. Tickets range from $100 to $150. Visit marylandisrael.org.

jsilberman@midatlanticmedia.com

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