Palestinian software companies merge; set sights on changing U.S. healthcare market
iConnect-Tech and 2i Software, two software development companies with front offices in Chicago and programming teams based in Palestine, have been working out of the same building in Ramallah for three years. Now, iConnect has acquired 2i’s Palestinian operation and is looking to provide business intelligence services for the U.S. healthcare market.
The origins of the deal between iConnect and 2i, inked at the end of February, stretch back to 2010. At that point, Kais Salhut, a native of Jerusalem who moved to the U.S. at 17 to attend school, was starting a Palestinian development team for 2i, which also has operations in Malta and India.
Salhut knew iConnect’s management in Chicago and was aware that the two companies had similar administrative structures with different specialties. It was only natural that a relationship would develop between the two operations. “We knew something was going to happen,” Salhut explains. “We just didn’t know what it would be.”
The rollout of the Affordable Care Act, Barack Obama’s signature healthcare law, offered the perfect opportunity for iConnect and 2i’s Palestine team to join forces. iConnect has a background in developing healthcare apps, and 2i’s Palestine team has experience in developing business intelligence software to help corporate clients sift through and optimize large amounts of data.
The implementation of the Affordable Care Act signals a shift in the American healthcare industry to an evidence-based system, Salhut explains. Previously, if a patient walked into an emergency room, the doctor would order any number of tests, insurance companies would pick up the tab, and doctors wouldn’t have to worry about being sued if they missed something.
In the new system, hospitals rely on computer programs to run diagnostics on large amounts of data in order to determine what tests are necessary for a given symptom. The idea is to make sure patients are properly diagnosed and receive the treatment they need while also cutting costs associated with infinite tests, according to Salhut. The new, data driven approach to healthcare fits right into iConnect and 2i’s overlapping expertise.
The deal between the two companies, which was finalized on February 21st, has 2i’s Palestine team moving over to iConnect, where Salhut is now working as the CEO. Part of the logic behind the merger is that together, the companies stand a better chance of competing internationally. “The only way we can compete,” Salhut says, is “by bringing forces together.”
iConnect’s staff in Palestine, with the addition of the 2i team, now consists of 44 developers. The company plans to add 10 to 15 more by the end of the year and, eventually, double in size.
Developing in Palestine
The potential for growth in Palestine, home to a disproportionately large number of computer science graduates, is huge, Salhut says. However, there are obstacles to doing business in Palestine; challenges related to freedom of movement are at the top of the list.
Salhut, who lives most of the time in Chicago, is currently facing a battle in an Israeli court to keep his Jerusalem residency card. If his residency card is revoked, it will be virtually impossible for him to travel to Palestine, regardless of his livelihood.
But developers based in Palestine have adapted to doing their work in difficult conditions. “They are used to the situation,” Salhut explains. “It’s part of their normal lives.”
As far as the iConnect team goes, all of the company’s data is stored on cloud servers. Programmers work from laptops and everyone has a 3G mobile internet stick, although they have to connect to the Israeli network as there is no 3G in Palestine. The situation can be challenging, Salhut says, but it is no worse than anywhere else in the world.
Looking toward growth
Having learned to navigate the pitfalls of working in Palestine, iConnect is looking to the future. The newly merged team is working with Medcor, a U.S.-based company that runs worksite health and wellness clinics for businesses. The iConnect team is doing a research and development project to build a product that will assist with a new American approach to healthcare.
In the long term, Salhut’s mission is to “help the Palestinian people and improve lives over there,” he says from his U.S. base. To do this, he wants to contribute to turning Palestine into a destination for computer programming and software development. “It’s going to just be a matter of years before people start coming to Palestine directly” for work in these fields, he says.