Last weekend, I had the pleasure of spending a few days in Tel Aviv, in between Dublin Web and Slush conferences, and had the chance to meet students from Tel Aviv University’s entrepreneurship center, StarTau, and the Hive. There's no question that Israeli startups are so successful – with the rapidly growing tech economy in the country, startups have accordingly been on the lookout for funding. Since the most popular questions revolved around how to secure US-based investor funding, here's a post on how great Israeli startups can secure funding in the United States:
Start with Israeli Sources
The best Israeli investors, from the key super-angels to incubators such as Microsoft, maintain their own relationships with a network of US investors. You can often use these as a starting point for constructing your own relationships.
Be Open to Relocation
Many US investors will want to see Israeli startup founders relocate to the US at some point in the company’s lifecycle – typically to Silicon Valley or New York. My personal preference is usually as early as possible, but it’s case by case and also depends on your market and path for growth. For B2B startups, relocation to the US is almost always an imperative.
Focus on Value
Add US investors with experience investing in Israel and the knowledge and network to assist you in breaking into the US market and investor networks. It’s quality over quantity because the community of US angels and early-stage VCs who invest in Israel is still relatively small numerically, and if you connect to a few, you can then build connections with the rest over time.
Delay the Ask, Do Your Research
There is a tendency to ask for funding almost immediately, one you should resist. Ask first: why do I want this person or entity as an investor in the company? Can they help me?
Focus on Building Relationships
Quality over quantity, and patience, are the keys here. Identify investors who you believe can be strategic thought partners and add value, then ascertain that they also have a strong network. Focus your time on building strong relationships with a few of them, rather than trying to boil the ocean by meeting every investor possible and giving them your elevator pitch. If you get an investor to put time and energy into helping you and learning about their business – and this is particularly true for early stage angels – the percentage chance they will invest in you climbs dramatically.