By Peter Stein
Suzhou, China—An Israeli private-equity firm is hoping to profit by melding Israel's research-and-development skills with China's manufacturing prowess, playing to China's hunger for foreign technology.
The firm, Infinity Group, buys intellectual property from Israeli high-tech companies, often ones that can't make money from their inventions at home because Israel's market is small and production costs are high. Infinity then sells or licenses the IP rights to a Chinese company in which Infinity invests. The Chinese company develops ways to use the technology, drawing on the nation's manufacturing expertise, creating new products and applications that can feed into China's huge share of the global supply chain while tapping into the country's vast domestic market....
Bringing Israeli know-how to China reminds University of California, Berkeley, [School of Information] Professor AnnaLee Saxenian of the 1980s and 1990s, when Silicon Valley researchers conceived of technology for things like computer peripherals and commercialized it in Taiwan. "They took over the whole ecosystem of Silicon Valley," says Prof. Saxenian, who specializes in regional technology clusters. "This is a new take on that."...