Israel Venture Capital 2.0

Shana Tova תשע"א

Another year has passed, and it's time for the annual Shana Tova greeting. The past year was a good one, both on the personal and the professional side. If I can summarize the good professional side of the year in one phrase: "The rebound of online advertising". Clearly, the advertising business has seen a nice growth, and that was reflected in many of our portfolio companies. I can only wish for a similar strong year, and maybe, on top of that, interesting movement on the peace side (following the end-of year peace talk summit).

Last year I wished for 5 great deals (close one new investment: Sense of Fashion, but portfolio companies signed great deals, much more than 5), 3 great rock concerts (Got to see Pearl Jam 3 times…), and 1 championship (Nada. Maybe this year).

And finally, I wish for a better year for this blog. Last year I published 9 posts. The year before: 56. That's the difference between once a week, and once every 2 months. Let's hope I can get it going again.

Shana Tova.

Best Practices for Introduction Emails

Introductions are a key part in my business. I get introduced to a lot of people (entrepreneurs, other investors, potential business partners) and I constantly make introductions to other people (portfolio companies, entrepreneurs, and people looking for new positions). Through the years I have developed some “best practices” regarding introductions, and I thought to share those. Clearly, it’s not a big strategic issue, but I do wish that some of these will be adopted in the industry

Ask (Permission): Before making an introduction, always ask the permission of the people you are introducing. Many times I get introductions out of nowhere. I feel obliged to respond, although sometimes its irrelevant for my current focus. I always prefer to get an email ahead of time asking for my desire to get the introduction. I do the same – ask people if they are interested. It increases the response rate, and it also saves time for everyone involved.

Mention (Names): Introduction emails should always include the names of the people being introduced. Why? It helps the follow-up on these emails. When you send a lot of emails with the subject “Intro”, you get a long list of emails in he inbox with the same topic, yet all of them are not related. By adding the names, I easily know (when people reply) what is the context for this email.

Provide (Context). Always provide some business context. I recently got an introduction to an entrepreneur, out of the blue, with no information regarding his new company. How can I respond to that? A simple 2 line topic on what is general context makes life much easier as this email is being handled.

Respond. I truly hate "no responses". I agree with a someone regarding an introduction, I make the intro, and then I get no response. Wow – do I look stupid. That’s why I ask for permission. If we agreed on an intro, I truly expect a 100% response rate.

Free (the Introducer). After the connection was made. free the introducer from the loop. I make the intro, and then I need to follow 15 emails regarding the scheduling of a conference (and I am not even invited…). Do I really care if who is available on Thu at 9:45?

Share (Results). Finally, share the results of the introduction. You had a meeting? Meeting was successful? Always important to send another “Thanks” email and share the results of what happened.

Ask-Mention-Provide-Respond-Free-Share. That complicated? I will appreciate quick and wide adoption…

Self Interview

Since no one is really interested in interviewing me, I decided to do a self interview. This is my version of “self portrait”, especially since I can’t draw (or sing. or dance. Shows something about the qualities of VCs)

Why haven’t you blogged for since mid September?

Can’t really say. For some reason, I couldn’t bring myself to write. It’s not that I didn’t have anything to say. I actually had a lot to say, but my typing hands were heavy.

Do you think you are now officially back to blogging?

I can’t promise anything. But I will try. I will also be blogging at the Gemini blog.

Can you highlight the top 3 events that happened in your life in the past 60 days, just to fill the gap.

Sure. Business: We made another investment (eKoloko, an official post to come tomorrow). Music: I saw Pearl Jam live again, and I also saw Shalom Hanoch live. Sports: Patriots are back at it, Hapoel Haifa are not. Overall, seems like everything is “normal”.

Do you feel the Venture Industry in Israel is active again?

Absolutely. Deals are happening, especially since a lot of funds have dry powder to invest. However, Israel is part of the global venture industry, which is going through some turmoil. Nothing dramatic will happen in Israel in 2009/10, but we may see some changes in the local investment scene in 2-3 years.

What makes you optimistic?

AdMob. Mint. Gomez. Good companies are being acquired, and it feels that if we invest and support good companies, we will be rewarded.

Shana Tova תש”ע

Here it is, another Rosh Hashanah arriving, and the previous one still seems so recent. I looked back at my wishes from last year, and some of them came true. Obama won and showed the world what Leadership 2.0 is all about. Hapoel Haifa won, made it to the Israeli premier league, and did that with a lot of passion, commitment and style.

This year I decided to be a bit more specific, something beyond just general health and world peace. So, here are my 3 wishes for the new Jewish year:

• 5 great deals: When I talk about deals, I mean it in the most broad sense. Some combination of exits, strategic accounts, partnerships or massive distribution. 5 amazing business deals that will make a direct or indirect influence on Gemini’s success.
• 3 amazing rock concerts: I already have tickets for Leonard Cohen, Shalom Hanoch (1AM at the Barby) and Pearl Jam (again). Although we are back in Israel, I hope to attend at least 3 world class rock concerts with real emotional impact.
• 1 historical championship: Between the Patriots and Hapoel Haifa, how about another historic championship. Odds are low, but hey – I am asking for just one.

Add 5+3+1 and it equals Nine(9), the Hebrew letters of the new Jewish Year: תש”ע.

Shana Tova!

Analytics forever

A few days ago I sat down with the BI (Business Intelligence) manager in one of my portfolio companies. He showed me some key metrics on the business, and what they are measuring as they try to understand the fundamentals of the business.

Analytics is a key part of any web business, and in today’s world – any business, web or non-web. Everything needs to be measured, and it’s important to measure the right things. A lot of times, it’s the trivial stuff (# of users, growth, conversion) but other times it’s much more sophisticated (repeat users, traffic sources, segmentation, churn, etc.).

Having good metrics is important as they provide good information, and GREAT stories. Sitting with the BI manager taught me a lot about the business of that portfolio company. What is really happening? What customers are profitable? Where can we make more money? What are the current bottlenecks? With such insights, you can addicted to analytical information, as much as you can be addicted to the performance of a public stock. As such, I ask my companies to share data on a monthly basis. That’s the minimum resolution where you can see real changes, that are beyond just noise. I never want to get access to Google Analytics. As a board member, getting daily information can kill you.

A lot has been written on the importance of analytics. Check 360innovate as one example. Or just search Google for “importance of analytics”.

Now, here is a personal thought on analytics. I sometimes wish I could have analytics on my life. Some sort of a measurement tool on everything. Just for me. How many flights did I ever take? How much km did I run to date (total)? How many people did I meet? I can’t get this information. Is it interesting? Not sure. But maybe my grand kids will have all that in a database one day.

Nahum – 2 Weeks After

It's been 2 weeks since the accident, and a week since the Funeral of Nahum and Nava, and I have been thinking about them a lot. Clearly, Nahum was not a close friend of mine. We interacted a lot around eSnips, and some point (late 2008) we spoke on a daily basis. However, there is much I didn't know about him.

Still – his sudden death made me think about his legacy, and I now know that I have learned a lot from Nahum. Not all things can be written, but still, there are few things I took from him that will always be with me.

First of all, Nahum looked at the business in a very unemotional way. Every challenge was treated in the best way possible, without ego, and without personal emotions. I admire that, and I really think that putting emotions aside creates the best outcome for all people involved. That was the way Nahum treated the many challenges we had at eSnips, especially toward the end.

Second, Nahum always emphasized the big picture. It's never about the details, but the need to focus on the large, and important issues. I think that relates to his physics background, and for me – it's a critical part of my day-to-day job.

Finally, It was all about the attitude. No matter when we met, Nahum was always joking, always smiling, and always "playing the game". Even when I disagreed with him, it was always a pleasure to interact with him.

Yesterday I looked through all the old emails from Nahum, and I have many of them. I was hoping to find some emotional nugget, or something personal. Nahum, like Nahum, was always right to the point. Here is the email I got from him once all the eSnips transaction was finalized:

"All, we finally received all signatures on the Logia agreement this morning. Thanks to all involved. Nahum". What a way to summarize 6 months of hard and frustrating work.

I will definitely miss him.

Back

I left Silicon Valley on April 1st.

I travelled through the Northwest, visiting California, Oregon, Washington, Idaho, Montana, Wyoming, Utah and Nevada.

I spent a few days in Atlanta (mostly shopping).

I landed in Israel 2 weeks ago, and been running around trying to organize our new life, and get back into the work action.

But today I decided to make it official. I am back. Going forward, it will be much easier to write about Israel Venture Capital 2.0.

Butte, Montana

I am currently traveling with my family around the US, sort of a goodbye trip before we return back to Israel. Today we stopped for lunch in Butte, Montana. I never heard of this place, and I was quite surprised to find so many restaurants. A quick conversation with our waitress revealed a bit of the local history: Turns out Butte was the largest copper mine back in the early 20th century. At some point it was the largest city between Seattle and Minneapolis, with 100K+ people. Here is a direct quote from Wikipedia:

“Butte began as a mining town in the late 19th century in the Silver Bow Creek Valley, a natural bowl sitting high in the Rockies straddling the Continental Divide. At first only gold and silver were mined in the area, but the advent of electricity caused a soaring demand for copper, which was abundant in the area. The small town soon became one of the most prosperous cities in the country, especially during World War I, and was often called "the Richest Hill on Earth". It was the largest city for many hundreds of miles in all directions. The city attracted workers from Ireland, Wales, England, Lebanon, Canada, Finland, Austria, Serbia, Italy, China, Syria, Croatia, Mexico and all areas of the USA.”

But after World War I, the place began to wind down it’s copper production, and right now there are about 30K people only, and according to our waitress, about 50% of them are retired. And I must say the place really felt like a Ghost town. Beautiful but run-down buildings, empty streets. As you drove around town you can only think about the history and imagine how the streets and Saloons looked like 100 years ago.

Personally, it made me think about Silicon Valley. Isn’t the same quote above relevant to Silicon Valley today? The place attracts workers from all over the world. We won’t be around to see what happens in 100 years, but not sure technology will not move on to somewhere else (How about Israel? The Copper mining industry moved to Chile…). Also, Butte tells an interesting story of the US 2009. Amazing amazing past, but a lot of declining industries, and a real need to for reinvention. I guess that’s what Obama is all about.

 

Farewell Silicon Valley

Well, it’s official. What was done is done, and what I did not manage to do, well, there will be a next time. We are on the road, and although we will be landing in Israel only in May, I am officially done with my 3rd Silicon Valley Chapter. 1982-1983, 2000-2001, and 2006-2009.

Will there be a 4th time. Probably not, but who knows…

Attached is a small farewell video. I was looking for the right song, and after passing obvious selections (Homeward Bound or Two of us) to not-so obvious selections (All Apologies, All together now, or Pink Floyd’s Money) I finally landed on my favorite Mashina song (Yes, in Hebrew): Come Back, Come Back.

See you all in Israel.

4 thoughts on 40

This week I am turning 40. There you go - officially old. Some thoughts:

1. I clearly remember my parents being 40. In my memory, they are much older than I am at the same age. I guess the reality is that they were younger than what I perceived, and I am currently older...
2. Every 10 years I celebrate my birthday in a different location around the world. I was 10 on the east coast, 20 on the Golan Heights, 30 at Fontainebleau (France), and 40 on the west coast. I should try and celebrate my 50th birthday in a unique place, like... Tel-Aviv
3. The other day (while in Israel), I heard someone on the street shouting "Hey, kid" (In Hebrew: !ילד). I immediately turned around. Old habits die hard.
4. I am about 2 months away from being older than John Lennon

Quick summary of the past 10 years: 2 jobs, 2 relocations, 4 kids, 6 houses, 6 boards, 4 Laptops, and 10 iPods. Hope the next 10 years will be comparable, and would like to add a few exits to the list above.