After investing in dozens of Israeli startups that launched, scaled and set up their headquarters in the US, we have seen first-hand how founders planned and executed their US market strategy. Join us as we share the best practices and lessons learned from six years of helping Israeli founders break into the US market and raise over $500M. This session will cover what works, what to avoid, and what American customers, partners, and investors actually care about. (Hint: it's not your military background...) Topics include: - How and when to find US-based customers and partners while still operating out of Israel - How Israeli startups should go about raising capital from US-based investors. Do you even need to? - Should you set up a US office? And if so, when and where? - Mistakes you can avoid if splitting your team between Israel and the US

1. Gil Ben-Artzy, UpWest Labs
Google Campus, Jan 18 2018
The UpWest Playbook for
Breaking into the US Market

2. WORK
LIFE
EDU

3. Silicon Valley Fund
Investing in Israeli Founders
Targeting the US Market

4. $500M
In Follow-On Funding
1,500+
average seed round
$1.2M>70%
employeesraised funding

5. This is Just the Beginning ...
Market Access
Mentorship
Funding
“Phase I”: 4-6 Months

6. “Phase II”: 6-24 Months
Operations
Fundraising
Scaling Know-how
Follow-on Investing

7. Case Study:
Adapting to the US Market
Oz Alon, CEO & Co-founder,
2012 UpWest Invests; Product Pivot
2013 Seed Round, US HQ
2014 Market Expansion, Series A
2015 Series B
2016 2 Acquisitions, 100x Growth
2017 Revenue Growth

8. Case Study:
Launching & Scaling in the US
Tomer Weingarten, CEO & Co-founder,
2013 UpWest Invests; Customers,
Advisors, Seed Round
2014 Series A, Exec Hires
2015 Series B
2016 Rapid Growth
2017 Series C

9. Multiple Domains
Wide Investment Scope
Pre/Post Product
Pre/Post Funding

10. Today’s Agenda
I. Misconceptions & Avoidable Mistakes
II. Fundraising Mindset & Expectations
III. Best Practices for Gaining Momentum

11. Why US? Benefits & Reality
Customers
Employees
Investors
Culture
High value, open for beta (esp. SV), in-person
Tech talent at premium, hard to retain
More $$$ @ better valuation, many options,
new network, high expectations
More different than expected….
Competitors Tough, well connected, “talk the talk”
Market Breeds huge companies, often gateway to ROW

12. “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”

13. Aiming too low & not building a long-term vision
Hiring a “Ghost CEO” to act on your behalf in the US
Product-centric vs market-centric
Mistaking fake validation as real feedback
Believing your homegrown street cred is transferable to US
Common Traps
Source: Shuly Galili, Co-founder, UpWest Labs. https://medium.com/@shulygalili_12357/six-common-traps-foreign-founders-
repeatedly-fall-for-in-the-us-market-d7224f06575c

14. Today’s Agenda
I. Misconceptions & Avoidable Mistakes
II. Fundraising Mindset & Expectations
III. Best Practices for Gaining Momentum

15. 38.1
7.4 4.8
California New York Israel
Venture Capital Investment in 2016 ($B)
“Let’s Go Abroad, It’s Easier to Raise Money in the US!”

16. Pension Funds, University Endowments,
Wealthy Families, Corporations, etc.
Bonds,
Stocks,
etc.
VC
Capital Allocation to Venture Capital = 3-10%
Who Invests in VCs?

17. Top 20 VC Funds
Other VC Funds
<1x
1-2x
2-3x
>3x
VC ReturnsVC Funds
98% 95%
2%
5%
50%
35%
10%
5%
VC ReturnsVC Funds
Do VCs Meet Investor Expectations?

18. Fund Returns Exits
$1B $3B $15B
3X
20%
Equity
* Few Investments per Partner
How Do VCs Make Money?

19. Option A Option B
Exit 1
Exit 2
Exit 3
Exit 4
Exit 5
Exit 1
Exit 2
Exit 3
Returns = $3B Returns = $3B
How Do The Best VCs Reach 3x?
Imagine you made 30 investments….

20. * VC could agree to smaller exits if you are not going to be big as they had
hoped, IRR & fundraising considerations, founding team really insist, etc.
Startup
“I need to show
potential for $50M
in Revenues in
Year 5 (or >100M
users)”
VC Partner
“Should I bet part
of my career on
this startup?”
Investors Want to Fall in Love

21. Large Funds Micro-Funds Angel Investors
“I need
large exits”
“Small exits
are unlikely…
Need micro-
funds to invest in
my startups”
“Medium-size exits
are unlikely…
Need large funds
to invest in my
startups”
VC Economics Impacts ALL Investors

22. Goal: Invest in the Outliers

23. • No “2-week funding roadshows”
• Get local proof: customers, advisory board, etc
• Learn from Israeli entrepreneurs (R&D in Israel, etc)
• Move before the round (50%+ can work too)
• Ask for help, leverage friendly intros
Early Stage Investing is a Local Business
If You Are Raising In the US….

24. Today’s Agenda
I. Misconceptions & Avoidable Mistakes
II. Fundraising Mindset & Expectations
III. Best Practices for Gaining Momentum

25. The More Time You Spend in the US…
… the faster you get to product-market fit
… the more extensive and stronger your
network of partners, advisors, etc
… the odds (and size) of an exit increases

26.  Lightweight engagement
 Deciding to move
 The Split
Gaining Momentum

27. • It’s Always Good Timing (advice/feedback, trial, sell)
• Plan ~6 Wks Ahead, Visit for at Least 2 Wks
(Anchor, conference/meetups, 50-75% planned)
• Identify Customers, Partners, Sources of Feedback
(relevant, motivated, LinkedIn)
• Ask for Help! (friends, etc.)
Lightweight – Planning Ahead

28. • Know Your Story (Team, Market, Momentum)
• 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!
Lightweight – The Visit

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

30. • Make the US Part of Your Routine
• Focus on Creating Momentum
• Plan Ahead, Ask for Help
Lightweight – Summary

31. Noam Bardin, Waze CEO:
“Splitting up a small company across 7,000 miles, a 10-hour
time zone difference and a ~24hour+ connecting flight is one
of the worst things you can do as it adds tremendous
execution risk. But the only thing worse is not doing it.
Between the execution risk (that is within your control) and
the risk of not being there (which becomes out of your
control), I choose the former. I want to choose the risk I take.”
The Decision

32. • STSSTIAP  Early product
When: Establishing US Presence
• Don’t wait for funding
• Don’t wait to complete Pilot in Israel
• Part of company’s DNA

33. How: Establishing US Presence
• CEO/Founder in US, founder in Israel
• Functional concentration, Product/Eng. alignment
• Constant flying
• Leverage funds/programs for softer landing
• Get out of the building
• Hire well-connected US employees

34. Thank You
gil@upwestlabs.com