Israeli VC on Sand Hill road

No smoking follow-on post

About a month ago, I posted about the new no smoking law passed in Israel, and how it was totally ignored at my local sushi/tapas bar.  After hearing repeatedly how this law is being enforced in Tel Aviv, we ventured back to this local joint. 

When we walked in, there were no ashtrays on the tables (compared to last time), and it didn’t seem to reek of cigarettes.

However, about 15 minutes into the evening, those that had just arrived, started to light up.  Ok, not using the fancy ashtrays, but soy sauce dishes, provided by the bar tender… We summoned the manager, who’s response was that they can’t ask each and everyone not to smoke, and that we should take notice that there are no ashtrays, and there’s even a “smoking is bad for you” sign on the wall. 

The manager expressed his disappointment at the level of enforcement of this law by those that are supposed to be enforcing it (I thought that meant him).

So, where do I stand on this? Very unhappy. For those that have experienced similar experiences, check out what you can do about it at http://www.linshom.com/.  Apparently, these guys (and probably others), won’t act as required by law until they find themselves engaged in a few law suits.

Tags: no+smoking, israel

Too early?

Many times in the life of a start-up, we find ourselves asking the question: “Are we too early?”.  Too early for:

• Talking to customers
• Talking to partners
• Hiring the VP Marketing
• Hiring a CFO
• Shipping the beta product
• Talking to VC’s
• Raising the next round

etc., etc., etc.

In this post, I would like to discuss “Too early for VC”.  When an entrepreneur is just starting out, and doesn’t quite have the full story figured out, most people advise “don’t talk to them”.  In some cases, I might agree, however, with the following HUGE caveat: Depends with whom would you like to talk!

Yes, biased I am… since I (as well as my partners here at Gemini), prefer to see entrepreneurs as early as possible, knowing all too well that the discuss is potentially premature.  By engaging at this nascent phase, we learn to work with an entrepreneur, learn how they think, work and see the progress (and they with us). It is very time consuming for us, but it is also extremely rewarding.  Is there a risk that the company is totally off track, and will never be able to approach said VC again? Maybe.  However, if you do your DD properly, and get an understanding of the person with whom you will be meeting, you can mitigate this risk significantly.

This same point holds true for the next funding round.  Once I have invested in the Series A, eventually that Series B will come along.  There are specific targets that make a company “B ready”; some achieve B-readiness well in advance of their need to raise additional capital, with others it takes a bit longer.  Post the A investment, many VC’s will be monitoring the progress of this company in order to be there in time to make the Series B investment.  Often, we are asked for meetings before we are ready to fundraise. Often it coincides with a trip to Israel by a foreign venture capitalist.  Being Israeli, we like to be opportunistic, since after all, the person is already here, etc.  This, however, can be a mistake!  Unfortunately, too often, the company can be judged as being “too early”, when it is in fact “too early” .  The only reason the meeting was scheduled was in response to the opportunity presented - and it backfires and we find ourselves having to fix a situation that we shouldn't have really gotten ourselves into. 

So, what is my view?  Tread carefully.  And if you are indeed too early for a Series B meeting, and a Series B investor is “in town”, or wants an “informal meeting” or agrees to serve as a “dry run”, just decline politely (unless there’s something in the relationship that you feel will allow you to have a real value-adding open discussion…).

 

Tags: gemini+israel+funds, too+early+for+vc, when+to+approach+vc

Summer plans in Winter

As the US shuts down for Christmas, New Years and the multinational winter break, here in Israel, we’re actually very busy.  Although some of us join the club and take a vacation (not I), most are busy entertaining friends that have taken their vacation here in Israel. In my world, I actually find myself with additional meetings with those business people that have combined their vacation in Israel with a bit of work…

While we’re in the middle of winter (or technically, in the beginning of winter), I get a reminder to sign up my kids for Tawonga summer camp.  What seemed so “normal” while living in Silicon Valley, seems totally absurd today. Of course, if I opt not to register the kids, they will not even have an option of Tawonga…. looks like this year, I will keep to my newly planted Israeli roots, and make my summer plans in summer .

Tags: tawonga, winter+holidays+in+Israel

Tech making trek from the desert to the valley

Adrienne Sanders wrote a comprehensive article for the San Francisco Business Times about Israeli firms setting up their US operations in Silicon Valley.  You can link to it here.

Of course, this presents a Silicon Valley view.  I would love to see the compatible “Boston Business Times” with an article discussing the same on the other coast.

West vs. East is almost a matter of religion.  I have my opinion (!), and there are those on the other coast with theirs as well.  The obvious advantage of the east coast is 3 less time zones and shorter flying time. Other than that… if you’re not in the financial sector, I would point my US ops in the direction of the Golden State anyday!

 

Tags: adrienne+sanders, east+coast+vs.+west+coast, where+to+open+US+office+for+israeli+comapny, san+francisco+business+times

Facebook and politics

It’s been almost a year and a half since we moved back from Silicon Valley to Israel, however my home page has remained the SJ Mercury news. (I also still carry a Whole Foods reusable foldable bag in my purse, but will discuss that sometime in the future.) What caught my attention today was a posting about Syria shutting down the Facebook site.  Why? For fear that Israeli’s will ‘infiltrate’ Syria’s social network.  I wonder what would our neighboring countries do without having Israel as an excuse ….

Tags: san+jose+mercury+news, whole+foods, Syria+shuts+down+facebook, facebook

Where is Skype recruiting engineers from?

Why, Israel, of course! I haven’t flipped through the local “want ads” for quite awhile.  When the bubble burst, that section of the paper was very, very thin, and rarely had a word “engineer” appear.  Nowadays, it reaches 2 full sections, each with over 30 pages, of enticing color ads, as the Israeli companies of all size compete for the best.  The ad that caught my attention, was a full page color ad on the back side of one of those sections, posted by Skype.

My first thought was, “I didn’t realize Skype was opening an Israeli R&D center”, but at second glance realized they were offering relocation to the Czech Republic or Estonia.  What are they seeking? The same as everybody else: Java developers, C++ developers, QA engineers, etc…. The world is definately getting flatter.

Tags: skype, recruiting+engineers+in+israel, israeli+engineers, java+developers+wanted, world+is+flat

Who's due diligencing whom?

When an entrepreneur sets foot in Gemini, they know that there is a well defined path leading to a potential investment, which includes meetings with the general partners, and of course a thorough due diligence process, with additional conversations/meetings with potential customers, partners, analysts, HR, etc., etc.  We’re often asked how long does this take, which is an answer that varies greatly according to the company.  We try and keep this process as transparent as possible, so that the entrepreneur knows exactly where they stand, what happens next, and what is the feedback that we are getting.  It’s definitely an intense and iterative process involving us and the company.  In addition to understanding the company and its business, we learn how to work together.

We always suggest to the entrepreneurs that they do thorough due diligence on us as well.  The relationship between a VC and an entrepreneur is literally “until death do us part”.

Last week, for the first time in my VC career (now 13+ years), I received a request from an entrepreneur for my personal references, if I was to join the board.  He was very specific about what he was interested in:

• One from a company that had experienced difficulties while I was on their board
• Another from a non-managerial board member of a company

I have to say, I was impressed. At the same time, I was surprised that never before had somebody outright asked me for such information. 

To the entrepreneurial community out there – knowing who is your VC partner is so important, I can hardly put enough ! marks on this statement!!!  What’s good for one entrepreneur, may not work for another and vice versa.  So my recommendation – do your work and hopefully, you can get the partner that is the best fit for your company on board.

Tags: due+diligence, reference+checks, venture+capital, gemini+israel+funds

The US, post Thanksgiving

Living in Israel, you tend to forget what post-Thanksgiving in the US is like. From the second I landed at Newark I got a quick reminder.  Beautifully decorated Christmas trees, lighting, fake presents, Christmas music in the air, and of course the token hannukah menorah in their midst.

Yes, it is very festive, but at the same time, somewhat annoying.  A friend of mine was invited to man the ‘dreidle’ table for her daughters holiday party on December 20th (a date, by which Hannukah will be a mere memory this year).  For those who perhaps don’t know, there is no connection between Hannukah and Christmas.  They just happen to fall in the same month. 

In Israel, Hannukah is hardly a “big deal”. Yes, kids get gifts (from parents and grandparents usually), and there are Hannukah class parties and candle lighting among family and friends, but that’s about it.  I hope that it stays that way. This commercialization is just too much for me. 

Tonight we light the first candle: Happy Hannukah!

Tags: hannukah, christmas, commercialization+of+holiday

While on the "NatBag Express"

As I was preparing for my upcoming trip to the US, I decided to to check out the “Natbag express” – the train which will take me almost from my Moshav, all the way to Ben Gurion Airport for 23 NIS (vs. 230 NIS for a cab, or similar in parking fees).  If I do this in Milan or London, then why not TLV???  Not only is this a convenient way to arrive at the airport, putting me straight into the terminal, it is cheap and environmentally friendlier than any other alternative.  I am now officially ‘hooked’.

While on the Natbag Express, I flipped through a copy of TheMarker that somebody had left on the seat and much to my surprise, found my own photo in print.  The Article by Guy Grimland was about TheFunded.com and my blog was quoted in print!!! That’s a first for me.  My blog has been linked to, linked from, commented, criticized, listed in other blogs, etc., etc. but quoted in print?  I suppose there’s nothing really wrong with that, but it still feels odd.

 

 

Tags: israel+railways, ben+gurion+airport, train+to+tel+aviv+airport, guy+grimland, themarker