On March 16, the United States Israel Business Alliance (USIBA) released an independent report quantifying the economic relationship between California and Israel. The findings highlight the significant impact of Israeli-founded companies in the state: they generate more than 22,650 jobs, $4 billion in compensation and nearly $9 billion in total economic output, with average salaries exceeding $175,000.

The alliance works to strengthen economic ties between U.S. states and Israel. It organizes economic development missions to Israel for governors, higher education officials and business leaders and helps connect Israeli technology solutions to local challenges in the United States.

Aaron Kaplowitz, president of USIBA, who ordered the report, emphasized the mutual benefits of this relationship. “Israeli companies benefit from being part of California’s robust tech ecosystem, where strong local companies provide opportunities for partnerships and collaboration, and in turn, California companies gain from the significant Israeli presence,” he said.

Aaron Kaplowitz

The report came shortly after Governor Gavin Newsom described Israel as an apartheid state, a comment he retracted a few weeks later. He claimed that he meant to refer to Israel’s potential future direction, said he supports Israel but quickly added his opposition to Prime Minister Benjamin Netanyahu.

Kaplowitz noted that feeling welcome in California is essential for Israeli entrepreneurs. “Israelis, like many people in the world, want to feel welcome. If political discourse is overly critical, they might look for a place that embraces them,” he said. “While California remains open to Israeli business, leadership — whether in business, political or cultural spheres — is essential to ensure these companies feel truly welcomed.”

California has long been home to Israeli entrepreneurs and companies spanning tech, cybersecurity, custom software, financial services and full-service restaurants. These businesses generate jobs and strengthen the state economy. Breaking down the numbers by county and Congressional District, the report shows the scale of their influence: Santa Clara County accounts for 11,000 jobs, San Francisco 2,300, and Los Angeles nearly 2,700. “When you look at these numbers, it’s clear how integral these companies are to the local economy,” Kaplowitz said.

Speaking with The Journal from his home in Miami, Kaplowitz highlighted the collaborative environment that draws Israeli startups to California. “There’s a lot of collaboration with universities, companies and government programs. That’s one of the reasons so many companies are drawn here,” he said. “California has the largest state economy in the U.S., and Silicon Valley’s infrastructure is world-class. Tech companies can embed themselves in this ecosystem for partnerships, customers and collaborations.”

The report also underscores the high quality of jobs created. Average earnings of positions generated by Israeli companies are nearly double the California state average. “These companies create high-skilled jobs and drive local revenue,” Kaplowitz said. “When salaries are that high, the downstream impact on the state and communities is significant.”

“Four out of the top five industries are in tech,” he added. “The only one that’s not tech is full-service restaurants. We have AI firms, software companies and financial services companies. These businesses are real anchors in Silicon Valley.”

This is USIBA’s fourth report, following studies in Florida, Virginia and New York. The California report provides a detailed analysis of the economic, social and technological footprint of Israeli-founded companies, highlighting their role in driving innovation and supporting the state’s economy. USIBA’s mission is to foster economic opportunities between U.S. states and Israel, including organizing economic development missions for governors.

Looking ahead, Kaplowitz highlighted opportunities for collaboration in security technology, particularly with major events on the horizon. “California will host two FIFA World Cup matches this summer and the 2028 Olympics in Los Angeles. These are complex events, especially for security. Israel is a world leader in certain technologies, and Israeli companies should have a seat at the table. Their involvement will not only keep Californians safe but also create jobs and generate revenue.”

With 32 Israeli-founded unicorns  — privately held startups valued at over $1 billion —  in California — the most of any U.S. state — these companies shape the Silicon Valley technology landscape, offering high-paying jobs and contributing substantially to the state’s innovation ecosystem. From cybersecurity to lifestyle sectors, Israeli entrepreneurs are leaving a lasting mark on the economy while fostering collaboration between Israel and California’s business and academic communities.

Kaplowitz also emphasized the entrepreneurial spirit that distinguishes Israeli-founded companies. “Where Israelis stand out is their chutzpah — they don’t give up easily. There’s no such thing as ‘no’ to an Israeli founder. It’s part of their dynamism, and it helps them succeed in a competitive tech ecosystem.”

When asked what California business leaders should take away from the report, Kaplowitz stressed the importance of data-driven policy. “The first thing we want is for them to know the actual data, so policies reflect what’s real, not just assumptions,” he said. He also noted California’s incentive to continue attracting Israeli entrepreneurs, particularly to maintain its edge in Silicon Valley.

Kaplowitz highlighted the role of academic collaboration in the research, mentioning the involvement of volunteer students from UC Berkeley who helped identify companies for the study. “Their contributions helped provide a more complete picture of the Israeli business presence in the state,” he said.

“California should keep promoting itself to Israeli founders,” Kaplowitz concluded. “These companies are not only driving innovation and high-skilled jobs, but they’re also strengthening the local economy and sustaining the state’s competitive advantage in technology and entrepreneurship.”