Crucially, the community is now beginning to attract investors. The Sadara Fund, the first venture capital fund focused on the Palestinian territories, launched last year with an initial $28 million to invest in Palestinian start-ups. At the time, Sadara estimated that more than 300 tech companies were operating in the West Bank and the Gaza Strip, employing about 3,200 people.
"We're starting to see some green spots here and there, but not by any stretch of the imagination do we have a mature ecosystem," says Saed Nashef, a Palestinian-American software entrepreneur who lives in East Jerusalem and is a managing partner of Sadara. "But the entrepreneurs have started to think they can go out there and do something of value. If you get one or two of these guys going, you get things going."
In booming Ramallah, the administrative seat of the Palestinian Authority, cranes and new high-rise office buildings jut from the rolling hills, with new names like Asal Technologies and PalTel emblazoned on the buildings. Many were started with seed money from local nongovernmental organizations.
The potential here prompted Mr. Nashef to return home from the US, where he went to college and worked as a software engineer for Microsoft. Now he has teamed up with Yadin Kauffman, a New York lawyer who was a partner in the first venture capital fund in Israel in the 1980s.