Start-up Nation

THE TWO MEN MADE AN ODD COUPLE as they sat, waiting, in an elegant suite in the Sheraton Seehof, high up in the Swiss Alps. There was no time to cut the tension with small talk; they just exchanged nervous glances. The older man, more than twice the age of the younger and not one to become easily discouraged, was the calmer of the two. The younger man normally exuded the self-confidence that comes with being the smartest person in the room, but repeated rejections had begun to foster doubt in his mind: Would he really be able to pull off reinventing three megaindustries? He was anxious for the next meeting to begin.

It was not clear why the older man was subjecting himself to this kind of hassle and to the risk of humiliation. He was the world’s most famous living Israeli, an erudite two-time prime minister and Nobel Prize winner. At eighty-three years old, Shimon Peres certainly did not need another adventure.

Just securing these meetings had been a challenge. Shimon Peres was a perennial fixture at the annual Davos World Economic Forum. For the press, waiting to see whether this or that Arab potentate would shake Peres’s hand was an easy source of drama at what was otherwise a dressed-up business conference. He was one of the famous leaders CEOs typically wanted to meet.

So when Peres invited the CEOs of the world’s five largest carmakers to meet with him, he expected that they would show up. But it was early 2007, the global financial crisis was not yet on the horizon, the auto industry was not feeling the pressure it would a year later, and the American Big Three—GM, Ford, and Chrysler—didn’t bother to respond. Another top automaker had arrived, but he’d spent the entire twenty-five minutes explaining that Peres’s idea would never work. He wasn’t interested in hearing about the Israeli leader’s utopian scheme to switch the world over to fully electric vehicles, and even if he had been, he wouldn’t dream of launching it in a tiny country like Israel. “Look, I’ve read Shai’s paper,” the auto executive told Peres, referring to the white paper Peres had sent with the invitation. “He’s fantasizing. There is no car like that. We’ve tried it, and it can’t be built.” He went on to explain that hybrid cars were the only realistic solution.

Shai Agassi was the younger man making the pitch alongside Peres. At the time, Agassi was an executive at SAP, the largest enterprise software company in the world. Agassi had joined the German tech giant in 2000, after it bought his Israeli start-up, TopTier Software, for $400 million. The sale had proved that though the tech bubble had just burst, some Israeli companies could still garner precrash values.

Agassi founded TopTier when he was twenty-four. Fifteen years later, he headed two SAP subsidiaries, was the youngest and only non-German member of SAP’s board, and had been short-listed for CEO. Even if he missed the ring at thirty-nine, he could be pretty confident that someday it would be his.

Yet here Agassi was, with the next president of Israel, trying to instruct an auto executive on the future of the auto industry. Even he was beginning to wonder if this entire idea was preposterous, especially since it had begun as nothing more than a thought experiment.

At what Agassi calls “Baby Davos”—the Forum for Young Leaders—two years before, he had taken seriously a challenge to the group to come up with a way to make the world a “better place” by 2030. Most participants proposed tweaks to their businesses. Agassi came up with an idea so ambitious that most people thought him naive. “I decided that the most important thing to do was to figure out how to take a single country off of oil,” he told us.

Agassi believed that if just one country was able to become completely oil-independent, the world would follow. The first step was to find a way to run cars without oil.

This alone was not a revolutionary insight.

He explored some exotic technologies for powering cars, such as hydrogen fuel cells, but they all seemed like they would forever be ten years away. So Agassi decided to focus on the simplest system of all: battery-powered electric vehicles. The concept was one that had been rejected in the past as too limiting and expensive, but Agassi thought he had a solution to make the electric car not just viable for consumers but preferable. If electric cars could be as cheap, convenient, and powerful as gas cars, who wouldn’t want one?