You have seen the show, but what is your strategy for turning vision into reality? You think (read: you know) you need to spend more time in Silicon Valley, but you are unsure of when and how to make the leap. Good news: every other Israeli startup that made it has been in your shoes. In this talk, we will offer practical advice for you to implement based on real case studies from the past 10 years of working with and advising Israeli startups and entrepreneurs that have successfully brought their companies to the Valley. Some of the topics that will be covered include: * When and how to begin fundraising, best practices and common pitfalls * Five common mistakes Israeli entrepreneurs make * Main misconceptions about Silicon Valley * Understanding Silicon Valley American language beyond the smile

1. SOSA, Tel Aviv July 15, 2014
This Isn't HBO:
Tried And True Ways To
Succeed In Silicon Valley

2. Life
Work
EDU

3. 3
40 Alumni Startups
>$50M in total funding
70% of raised follow-on funding
>20% of teams have a female founder
Acquisitions by Google, Priceline, Gartner, etc
Dozens of Fortune 500 customers and partners
Largest community of entrepreneurs
innovating between Israel and Silicon Valley

5. 5
Topics & Objectives
What is Silicon Valley All About?
Prioritizing your time
Creating Momentum Remotely
Establishing your “engagement model”
Establishing Presence
Beginning to weigh the options, best practices
Fundraising
Understanding the process & differences from Israel

6. 6
Topics
What is Silicon Valley All About?
Creating Momentum Remotely
Establishing Presence
Fundraising

7. 7
“It’s Easy to Raise Money!”

8. 8
“Look! A Unicorn!”

9. 9
After All, Numbers Don’t Lie
12
3
2
Silicon
Valley
New
York
Israel
Venture Capital
Investment in 2013 ($B)
“Unicorns” = >$1B
(since 2003)
Silicon
Valley
New
York
Other
29
3
7

10. 10
8200 49
81Talpiot
F-16
“We’re The Startup Nation”

11. 11
Imagine You Are an Israeli investor…
… and one day someone you
don’t know drops by…
Would you invest in someone…
… you have never met before
… who you have no context about
… and who lives thousands of KM away*?
*Amazing traction? Unique tech? Strong reference?
You meet with hundreds of
startups from your network…

12. 12
Yes, Investors Love Them
They spent lots of time on planes
They often have presence in US
They generated significant momentum

13. 13* So what do they care about?
But In Reality…
(and apologies in Advance)
Nobody Cares

14. So If Not Fundraising…
Product/Market Fit
(do your customers want what
you are selling?)
+
Distribution
(can you effectively get your
product to your customers?)
+
Business Model
(are you able to
make money?)
Create Momentum
Users
Customers
Partners
Advisors
New Hires
Investment Commitment
Thought Leadership
Press
…
Build a Business

15. 15
Silicon Valley: Reinforcing Ecosystem
Early Adopters
and Customers
Knowledge &
Innovation
Multi-stage
Capital

16. 16
Topics
What is Silicon Valley All About?
Creating Momentum Remotely
Establishing Presence
Fundraising

17. 17
“I Know I Need to Come, But…”
“…I need to first do a pilot in Israel, so I have
something to sell and not ‘burn’ myself”
“… coming every few months is enough”
“… I will hire a US Sales person to do the work”
“…I have the best tech, so they will buy from me”

18. 18
Set-up Visit Follow-Up
Planning
Ahead
What
To Do
Ensuring
Continuation
Creating Momentum

19. 19
The Set-Up
It’s Always Good Timing (advice/feedback, trial, sell)
Identify Customers, Partners, Sources of
Feedback (relevant, motivated)
Plan ~6 Wks Ahead, Visit for at Least 4 Wks
(Anchor, conference/meetups, 50-75% planned)
Ask for Help! (friends, etc)

20. 20
The Visit
Know Your Story (why they should care, what do you need)
Build Relationships, Emphasize Context
(listen & learn, project continuity vs. quick hit)
Ask for & Schedule Follow-Up Meetings
Allow for Semi-Planned Networking
(Meetups, “Stand in Luck’s Way”)
Meet *Some* Investors (friends)
Ask for Even More Help!

21. 21
The Follow-Up
Track & Summarize
Send Personalized Messages (recap, give back)
Ensure Momentum (action items, updates)
Plan Your Next Trip (In person > Skype)

22. 22
Summary
Make Silicon Valley Part of Your Routine
Focus on Creating Momentum
Plan Ahead, Ask for Help

23. 23
Topics
What is Silicon Valley All About?
Creating Momentum Remotely
Establishing Presence
Fundraising

24. 24
“Between the execution risk (that is within
your control) and the risk of not being in
Silicon Valley (which becomes out of your
control), I choose the former. I want to
choose the risk I take.”
-- Noam Bardin, Waze CEO
Why?

25. 25
9 Best Practices
1. CEO/Founder in US, Co-founder in Israel
2. Product/Engineering Alignment
3. Constant flying
How
When
What
4. STSSTIAP  Early Product
5. Don’t Wait for Funding
6. Don’t Wait to complete Pilot in Israel
7.Get out of the building
8.Hire US employees
9.Prioritize PR (when ready)

26. 26
Do Your Research

27. 27
Topics
What is Silicon Valley All About?
Creating Momentum Remotely
Establishing Presence
Fundraising

28. 28
Before We Begin…
This is the REALLY short version
There are always exceptions
If | When | What | How
Bold = SV-adjusted

29. 29
If
Aligning Incentives with the Investor
High Level of Commitment
Opportunity Cost

30. 30
Fund Economics
Hit Driven Business
Few Investments per Partner  Betting Their Career
Example:
$500M
Fund
$1.5B
Returns
$7.5B
Exits
3X
20%
Equity
Mega-funds influence ecosystem (Angels, Accelerators)

31. 31
Investor Goal: Big-Ass Returns

32. 32
When
Time = Your Most Valuable Asset
Plan to spend 3-4 months fundraising
“I will move after the round…”
Time of Year: Feb-June, Sept-Nov
Your “Shelf life”
Know Your Domain’s “Personality” (B2B, B2C, B2B2C)
Momentum: Lines Vs. Dots
Raise When You Can

33. 33
What
Round size = 2x larger
Valuations Differences
Enough for 12-18 Months
Cap Table Management
Milestone-based?

34. 34
How
US Roadshow! (not)
References Really Matter
Research portfolio to target relevant investors
Focus on investors that care (VC vs. Angel)
“Hard No” vs. “Soft No”
Do your Due Diligence…

35. 35
Common Pitfalls: The Short List
Not Being Positive and Upbeat
Giving the Impression You Know Everything
Trying to raise too early / too late
Transactional vs. Relationship-Oriented
Not Knowing Your Story or What You Want
Not Knowing Person, Company, Competition
Badmouthing/Dismissing the Competition
“Market Always Wins”
Pilot In Israel

36. Thank You
gil@upwestlabs.com