How to Build a Successful Start-up

Last month we were proud to host a unique entrepreneurs’ gathering at the new Ernst & Young facilities in MidTown TLV. More than 200 curious guests came to hear our expert panel as they explored and explained the ins and outs of start-up fundraising and crowd investing.

Among our impressive speakers were: Itay Zeteleny - Head of Global Incentives at Ernst & Young, Adv. Kimberly Drory – Partner & Business Development Manager at ERB, Alex Gitman from the Israel Innovation Authority, Karin Mayer Rubinstein - President & CEO of IATI and Shai Dill – Partner, Hi-tech Sector at Naschitz Brandes Amir.

One common and consistent theme was, that what you do early on in your start-up’s development will greatly impact the rest of your journey – from fundraising stages all the way through to your potential exit! Laying the correct groundwork is critical for your venture’s success.  We asked our expert panel to address key areas that every entrepreneur should consider:

Crucial Insights for Start-up Newbies

Our expert panel imparted some valuable advice for early stage entrepreneurs who have never embarked on their own venture before:

• Shai Dill from Naschitz Brandes Amir noted that even if you are still building your venture from home, you need to start thinking ahead. Be clear about hierarchy, roles and responsibilities. Verbal agreements will not stand the test of time. Decide on your partnership conditions as early as possible and put them in writing. Although it may feel premature, you will avoid potential lawsuits and arguments further down the line.
• Itay Zeteleny of EY recommended making a good solid business plan. Potential investors are looking for professionalism and they want to know exactly what you intend to do with their money. The main points of your business plan should include: A detailed explanation of your technology (in layman’s terms), business forecast and projection, plus show who your team is – Investors invest in people, not just a company!
• Kimberly Drory from ERB strongly recommends that you incorporate your company early on. This will help you to adopt a more professional mindset, plus investors are more likely to consider an incorporated company, as opposed to a group of individuals with an idea. Kimberly also recommended hiring an accountant who understands your particular business.

Global Market – Things to Consider

Potential investors will be more impressed by ventures with international impact and market possibilities. In fact, Alex Gitman from the Israel Innovation Authority says that his organization also prefers to work with global-minded start-up companies. In the long run, this will prove more valuable, not just for the entrepreneurs and investors, but also for the Country. Here are a couple of global insights:

• When going global, Shai Dill says it is important to consider regulatory conditions. Some countries are easier to work with than others. Shai recommends starting with a country that will have a smoother entry point, then once you have tackled one market, you can enter another, and so forth. You should also seriously consider your main operating location. If the bulk of your team are based in Eastern Europe, for example, it might not make sense to establish your company in Israel.
• Similarly, Kimberly Drory says you should carefully think about where you intend to register your IP and company structure. This will greatly depend on your target market and facilities. As an example, if you plan to register in the US, consider incorporating in one of the underdog States might have better tax conditions for your business type. In any event, you would be wise to seek the assistance of a global firm like ERB, which can help with setting you up overseas.

Absolute Musts

Disruption and rule-bending are in every successful entrepreneur’s toolkit. You will never be the next Waze or Mobileye if you don’t challenge convention. That said, even the top of the crop adheres to some basic standards in order to succeed. Our expert panel left the crowd with some key elements that they felt should not be overlooked:

• Kimberly Drory pointed out that although entrepreneurs possess incredible ideas and bundles of talent, they are not necessarily good business people. When you transform from a couple of individuals with zero cash, to a fully-fledged company with a million plus dollars in the bank and tens of employees, you need to be able to function as a business. HR, accounting and legal matters will be just a drop in the ocean of responsibilities. Give credit to the experts and let them deal with matters that are beyond your reach and capabilities.
• Karin Mayer Rubinstein, founder of the Israel Advanced Technology Industries initiative, says that passion should be your driving force. She recommends picking an idea that is most close to your heart and going all the way with it.
• Itay Zeteleny stressed that team is everything. Think very carefully about the people you choose to be part of your venture. As your company grows, look for individuals who will help you advance and have a positive impact on your business. Pick people that are right for the role!
• Shai Dill said that in order to succeed, you must know your market. He gave us the perfect crowdfunding example of the Coolest cooler, which raised over $13million via Kickstarter. A cooler is an item that is popular with middle-class pick-up driving Americans. Thus, the Coolest inventors had the right idea when they approached the public for funding, as opposed to a VC or Angel investor. In fact, they probably raised much more than they would have from private investors. Know your crowd!

Finally

Never underestimate the importance of a good advisor or mentor. Successful entrepreneurs often appoint advisors and mentors who are well versed in their field. As well as providing valuable information and knowledge, mentors can help to keep you motivated when challenges strike. ExitValley entrepreneurs are not alone. They have access to our bustling community of peers and investors. Furthermore, several of our founders are experienced entrepreneurs themselves and know exactly what it takes to help you reach your goal.

Indeed, appropriate guidance and tools are essential for building a successful startup, however your biggest learning curve will come with experience. Every day of your start-up journey will be filled with valuable lessons in business, finance, management, interpersonal relations and self-discovery. Some of these will be so challenging that you may even doubt and question your chosen path. Ultimately, those entrepreneurs who remain focused, positive and determined, are the ones most likely to succeed.

To learn more about raising money for your start-up via ExitValley’s equity crowdfunding platform, click here or feel free to contact us directly for more specific information.