This is kind of backwards. There aren't as many CS grads in Israel in the first place, because they already put their top talent through 8200. It's essentially a fully socialized Masters of computer engineering, and as a SIGINT shop they are learning this sort of thing. Once their 2-3 years of service is over (which doesn't result in student loans), the government makes a lot of seed funding available for startups and the TLV ecosystem is like a mini Bay Area.

Living with your parents is more socially acceptable, so they have a huge chunk of people in their 20s with no debt, low monthly expenses, strong technology expertise from their military service, in a founder hot spot, and access to capital. The result is a lot of unicorns, particular around cyber security (https://www.techaviv.com/unicorns).

Compare to the United States, where you have to dedicate 4 years to an undergrad program, go massively in debt, pay rent, and then struggle to find seed funding. The mental model of "oh, I guess we could apply some of the detritus of our failed system" misses the idea of having a successful system in the first place.