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entrepreneur/mother/education revolutionist/high tech addict

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venture capital funds

Reply: Why Index believes Israel is about to have its moment

I read the GIGAOM article titled “Why Index believes Israel is about to have its moment” by Bobbie Johnson yesterday and started to write my comment, when I realized it’s pretty long and should be posted on my own site too. So…

It’s true. Israel is about to have its moment.
It does not have a deep culture of UI and design and is traditionally technology lead. So much so, that if you are not offering a big tech invention (preferably the scope of the wheel…) people hardly perceive you as an entrepreneur, and would be skeptical about investing. Well, at least that was the case until recently.
Almost a decade too late concepts and web ventures have started to gain some acknowledgement, but as mentioned in the GIGAOM article, web entrepreneurs have had to move to the US to build their company.
Sad and a bit strange too, considering the development in communications and access. One of the things Saul Klein of Index Ventures said at a recent conference in Tel Aviv is that entrepreneurs don’t have to think relocation so quickly, and if they do, then a midway – like the UK – can sometimes be better than all the way to the US, especially if you intend to go global, beyond the US market. He also mentioned a CEO who traveled to the US once a month, if I remember correctly, and people in the US west coast he met with regularly were not even aware of the fact that he wasn’t based in the US.
What??? Really?
Yes. After all there are phones, email, Skype…
Still, there are challenges in running an international web venture from our small country, 7-hour time-zones apart from the east coast. I know. I am facing those challenges daily, though thankfully I have a NY based partner. That does not prevent the question from popping at every meeting “so, are you planning to relocate?”.

But Israel is about to have its moment, I say. It is. People won’t have to relocate to run their businesses. Companies will always need local marketing people at every market they’re penetrating, but there is no real excuse for managements to relocate into those markets.

As for the question “Can a home market of just 7 million people ever be big enough to support multinational internet businesses? Is Israel, which exists in its own political and geographical bubble, able to play host to all this?” – Israel can play host but not because of its 7 million people market, nor location, obviously. It’s the state of mind that provides the nurturing environment entrepreneurs need to grow a multinational internet business. It’s the spirit that has always existed here, and is now gradually shaking off the 7-million-people & geographical-constraints thanks to open and thick worldwide communications and social media.

A couple of years ago I attempted to establish an elementary school for entrepreneurship in Israel. I believe in entrepreneurship as a state of mind. I believe that directing kids at thinking entrepreneurship can prevent violence and bullying and promote creativity, learning and happiness, as in being self content. Looking around me there are so many broken systems, in Israel, in its neighboring countries and around the world. Only entrepreneurs can really make a difference, create the change. Being an entrepreneur you take responsibility over your own destiny, you give birth to ideas and do what it takes to execute them. You learn to collaborate and appreciate others, and the diversity around you. I promise you I am not taking it too far when I say that I believe entrepreneurship can bring peace. And so, yep, Israel is about to have its moment.

VC Marketing 3: The Listeners

After a while the entrepreneurs seeking investment can get a pretty bizarre feeling. You are driving, yet you’re on auto-pilot, and you’re getting nowhere. Seriously, are we driving at all?

But then comes this surprise meeting when you realize that yes, there is a road, you’re on it, and you’re definitely driving. You lose the auto-pilot and you’re wide awake.

These people can either invest or not, but you will remember them and their names, and you will follow them in years to come, because they did this one bit of basic marketing right.

They lost the auto-pilot!! They listened, communicated. They wanted to understand your message. Weren’t afraid to ask the tough questions or make suggestions. Yes those questions were directed at you, and not at every entrepreneur that came into their offices.

If the VC or investment firm has done their homework, you will meet their person who is the most-knowledgeable-in-your-area that they have. And if this person has done his or her homework, they would have researched your business, your industry and each one of the company’s partners to better prepare. Their listening has started way before your first handshake.

After all, they wouldn’t want to miss on a great opportunity only because they forgot to listen.

VC Marketing – They do it 2, Differently

Rise above the noise. Every marketer wants it. And yes, it’s true for VCs and angel investors too. Let’s be different. Let’s get noticed. Let us become entrepreneurs’ first choice.

One such investor, rising above the noise around me is Chris Sacca, with his fund “Lowercase Capital“. I love their web site. Or should I say his web site??

Unlike many VCs, made of a team of partners and professional employees proudly presented to potential investments and investors, Chris Sacca is, well, Chris Sacca. An accomplished venture investor and an entrepreneur. Lowercase is Chris and Chris is Lowercase.

If it wasn’t for the constant use of the word “we” on their web site Lowercase Capital could well seem to be a one-man-show. Its web site has a unique terminology and design. Somewhere between retro, old fashioned and good old westerns, this VC founder is featured under “proprietor” and the entrepreneurs wishing to get in touch are referred to as “prospecting”.

Their visual and verbal difference from the majority of venture capital investors and investment firms is not something they did because they just wanted seem different, or only to rise above the noise. Lowercase capital is stressing how apart it is from the stream under “creed” – their vision, a section opening with the words “Venture capital is broken”. Their appeal to entrepreneurs is coming from some point of empathy with the entrepreneurs’ deep pain and frustration which often accompanies the fund raising process. They are using good old fashioned sentimental motivation in marketing.

This is a web site entrepreneurs would want to read through and through. I am not sure anyone would bother to read all verbals on any VC web site. But here, you will. This web site gives you the feeling that it is indeed about compatibility and personal chemistry between you, the entrepreneur, and “the proprietor”. You would want to know what the other side is seeking and how to get them interested in your particular venture. So you will read every word there and make sure you can convince them that you are the entrepreneur who speaks the Lowercase Capital language. You and no other.

And to be sure you do – they offer you a guide, under “prospecting”. It is not a web form, but it is very much the format you are expected to use when applying. Use it smartly.

And last but not least – the call for action:
On “outfit”, the introduction section – “So take a look around this site and see if we are a fit. If so, we can’t wait to hear from you.”
On creed it is “We won’t be wearing a suit, and our lawyers won’t be in the meeting, but if you think we can help you, let us know.”
On prospecting it is “Now, send your pitch here and let’s get to it.”

Now, if that doesn’t get you on the move, what would?

VC Marketing, They do it too

A group of investors has been waiting for me to finish a few documents. So my guess is they might be surprised if I put up a new blog post before I submit their expected papers. Priorities, you know. This post got delayed. But along this ongoing process of funding my startup I can’t help but looking at my potential suppliers – those people with the money – and consider their marketing strategy: The investors’ marketing strategies.

As we, the entrepreneurs are searching for funds, and work really hard to market ourselves; we often forget that the people we try to market-to are also working hard on marketing themselves to us.

Investors, whether angels or funds, have to market not only to their investors, but also to the fund-seeking entrepreneurs. They compete on getting the best entrepreneurs coming through their doors first. Some acknowledge this reality better than others: The attitudes range between those who are playing hard to get to those who are open and accessible. Those you can only contact via a shared connection, to those who put their email-Facebook-twitter up there. Those who have you fill out forms to those who will happily get a friendly cup of coffee with you.

It was more than a decade ago that one of my clients was a major Israeli VC fund. I had consulted them on their web positioning and executed the project with the best GUI expert I have known, Yoav Perry, who happens to be my cofounder at Saveby, our startup. I just remembered that experience and considered the long way that web positioning and marketing tactics has made since. Well, at least in some cases. The most interesting cases are those revealing a unique positioning.

So starting close to home with the Israeli VCs I’ll disclose my interest first: My husband is Partner and CFO at Genesis Partners, one of the earliest and leading VCs in Israel. This is their homepage, the images switch randomly.

Genesis Partners Homepage
It's all about the people

The “all about the people” tagline says it all and markets to all direction: the people in the fund, the people trusting the fund with their money and of course the people that the fund invests in. Funds invest in people first, before the ideas.

The people are the fund’s greatest achievement. Which is why Genesis Partners have gone even further. They established “The Junction” – a shared workspace for entrepreneurs doing their very early steps towards a startup company. With an internet connection, a coffee machine and a conference room they fulfill the early stage entrepreneurs’ needs, and all that for less than the coffee costs. Did we mention marketing strategy?

Who will invest in startups in 2009?

While working on the script for a demo to present my startup venture, I am approaching the dreaded point where I will need to get other people’s money to advance my vision. In other words: fish for investors.

‘Investors’ are like a dirty word nowadays. When talking to other entrepreneurs the word “investors” or “investment” is whispered. As if by saying it out loud the dream will crumble and disappear.

The gloom projections for 2009, based on the sad financial events at the closure of 2008, add to a global pessimist atmosphere. The “realists” I meet say to me, nodding their heads, “well… a startup venture?? Now??? This is really not the time, you know??”

Well, what can I say, it’s now that I have this idea, and not later. True, I assume the competition will be fierce and the chances of landing that deserved funding are lesser this year. But that does not mean that by putting my project on hold for two years I will be able to promote the idea faster or safer then.

So I am back to my desk. Following the financial news and learning of the financial figures. I am trying to adopt my message to current times and events and see if I can find that path into some investors’ hearts.

money

*Click to Play Money by Pink Floyd

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