Eyal Rosner, IN Venture partner. Photography: Daniel Elior
More than 100 different venture capital funds operate in Israel today, and each one focuses on different stages in the life of a startup, in different fields and believes in its own investment strategy. Every month we here at Giktime bring you one venture capital fund and the story behind it – the way it chooses companies to invest in, the successes and failures, the warning lights and the characters that inspire its founders. And today we are with Eyal Rosner, managing partner at the IN Venture fund.
year of founding:
2019
Founders:
Eyal Rosner and Eitan Naor
The total value of the assets under the management of the fund:
“250 million dollars. We recently announced the closing of a second fund in the amount of 150 million dollars.”
Investment stages:
“Preliminaries – Sid up to A inclusive”
Top investment areas:
“DeepTech AI; Sustainability – including all the sub-fields such as energy, transportation, carbon emissions, food and agriculture – these fields and more are the cornerstones of sustainability and in most of them deep technology is required; Digital transformation – any technology that has the power to disrupt a traditional industry and transfer it to the digital world – the assumption is that every industry is going through or will go through a digital revolution that will disrupt the current ways of working. Our desire is to help companies that want to disrupt existing industries, to reach relevant target markets and customers”
The team of Classiq, a portfolio company of the fund | Photo: David Grab
Portfolio companies:
Classiq, H2Pro, Ottopia, Bria, Genoox, Anagog
Exits:
“GK8 Company”.
What will make you invest in the company?
“Entrepreneurs – what has not been said about the fact that almost everything begins and ends with entrepreneurship and entrepreneurs, and entrepreneurs are in many cases the difference between success and failure. There is also a gap between entrepreneurs who come for a short tour and a limited exit and entrepreneurs who are looking to establish a large company and win in a large market; The size of the market – in order to build a large company you need to operate in a large market. Venture capital funds by their nature look to invest in companies that can be leaders in a large market, in order for the companies themselves to be large enough to generate a proper financial return for the fund; Technology – technology is the barrier that makes it difficult for competitors to enter the market after you and win in it. It is clear that this barrier is often limited in time, yet it has the advantage of allowing a good company to lead the market it is trying to disrupt; Timing – that the solution comes when the market is ready to accept it – there are many stories about companies with amazing technology that the market was not ready to accept. The timing of reaching the market is critical in a company’s ability to succeed. Not too early (that no one will want to buy), and not too late when the competition is too great.”
What are the warning lights that will make you not invest?
“Since the entrepreneurs are the most important part of the venture, we will emphasize all the details related to the entrepreneur: his background, his connections from the past. What motivates him. How the entrepreneur communicates with us. In the case of several entrepreneurs, we will also look at the relationship between the entrepreneurs and the dynamics of their relationships “.
It is clear that in these processes there will be companies that will close, some because they had no right to exist in the first place, and others because they will fall into a situation where they are not attractive enough to raise money on the one hand, and not sufficiently financially backed on the other hand
After almost two years of a peak period for Israeli high-tech, in recent months we have seen a halt in investments, devaluations, down-rounds and layoffs. Is this a normal situation and nothing to get excited about? Easy fix? Bubble burst?
“The market is returning to its normal state, the startups understand that the world has changed and are trying to grow in a healthy way and not invest just to show growth. The size of the recruitments has returned to match the life stages of the startups and the recruitment processes have returned to a normal pace. It is clear that in these processes there will be companies that will close, some of them because they had no right to exist To begin with, and others because they will find themselves in a situation where they are not attractive enough to raise money on the one hand, and not sufficiently financially backed on the other. The other side of this is that good entrepreneurs who start now and manage to raise, will often build healthy companies from day one and encounter less competition. All these are market processes Healthy which will help in the long run to grow healthy and good companies.”
What is the fund’s investment strategy?
“The fund focuses on locating early-stage companies that operate in the areas of sustainability and digital transformation, and have the potential to be companies with a substantial impact on the world.”
What is unique about the foundation?
“The unique combination between a local and agile financial fund with a significant ability to create value for the portfolio companies thanks to an intimate partnership with a global conglomerate that operates in a large number of fields anywhere on the globe”
“A very strong team with a very relevant background that came to solve a big problem”, my founders Exodigo. Photo: Exodigo
In retrospect, which company would you like to invest in and missed out on?
“Exodigo. A very strong team with a very relevant background that came to solve a big problem that requires the integration of deep technologies. We got to know the company at the seed fundraising stage when the fundraising was closed, so despite our common desire and appreciation that we have a lot of strategic value to give, we were unable to join the round.”
Which figure in the industry (local or global) inspires you?
“Oren Ze’ev, who has an extraordinary ability to identify great entrepreneurs who come to solve big problems, and run with them for many years.”
Who opened the door to the field for you, or how did you get to your position?
“We established the fund, my partner Eitan and I, after over 25 very diverse years in the world of investments, with the aim of creating a platform that can create a significant impact.”
The petting zoo: what other fund does Paragon belong to?
“Entrée Capital. We made joint investments with them. This is a great and professional team that helped build impressive companies.”