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Gul Admati evacuated from his home in Kibbutz Dorot in the Western Negev to a hotel in Jerusalem on October 7. Nine days later, in the early days of the war when everything was still shrouded in a fog of fighting and uncertainty, he founded a food technology company called Cortein from his hotel room. “I was evacuated to Jerusalem with my family until the end of December, and it was very difficult to start a company. We just have to ‘move forward, build, progress and continue to work with innovation authorities,’ he says.
He started his second company (also out of a hotel room) in December. It’s an agritech startup called HarvestR, which has developed a technology to externally process crops, fruits, and vegetables with his non-GMO RNAi-induced mechanism. “There have been all sorts of rumors since before the war that there will be cuts of hundreds of millions of shekels; [Israel Innovation] The authorities will cut back on plans for the war. Actually that didn’t happen. ”
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Gul Admati.
(Credit: Aron Bernstein)
Admati was born in London to a British mother and an Israeli father from Kibbutz Beli. From the age of 11 he grew up in Be’eri and in 2010 moved with his family to Kibbutz Dorot. He has extensive experience in R&D management in the technology sector, and last year he served as Head of Venture Creation at InNegev tech. Incubator near Beersheba. This is also where his two startups, which he founded during the war, were born.
Funding for the start-up was obtained from the Innovation Bureau and an incubator, but hiring employees was difficult. “I think people don’t like change in times of crisis and pressure, when there’s a lot of uncertainty. Everyone wants to take office, so there’s a fear that there won’t be a suitable candidate for the role. I was planning on taking my current job, but there were certainly a few candidates. We are very happy to have hired someone who decided to take a risk and leave their previous job to join us. ” he says.
EndoCure develops an AI-based robotic ultrasound system for the diagnosis and management of endometriosis and was founded in November by CEO Dr. Hadas Ziso and Professor Moshe Shoham. At the same time, Dr. Giso’s husband was also called up to the reserves, as was one of the company’s few employees. “Due to the circumstances, with the team doctor being called up as a reserve and the deal with investors delayed, I decided I had no choice but to keep moving forward and bring good to the world. And I was in a lonely situation with my team.It was difficult both psychologically and logistically, but considering everything that’s going on right now, with or without money, I decided to start a company. “I decided to do it,” she says.
The company recently received a grant from the Innovation Agency’s Start-up Fund, which will enable it to work on developing its robotic system next year. “Fundraising is always difficult, but the fact that we are a young company with passion, as opposed to an older company facing a crisis and uncertain whether we will survive it, probably gives us an advantage. I think there is,” she said. She is, she says.
The company already began operations in January 2023 with employees working without pay, and officially established as a company in November 2023 and began hiring employees. “It was difficult to recruit employees. Some people turned cold at the last moment because they wanted to stay with the company, but we managed to find good people along the way and really dedicated people. We were able to hire two employees.”
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Dr. Hadas Jisso.
(Credit: Inon Vardi)
In recent years, the number of startups being founded in Israel has been steadily decreasing, with the number of new startups in 2022 expected to remain at around 600, up from 1,400 in 2014, according to the Innovation Agency. ing. At the end of April 2023, before the outbreak of war, the Innovation Agency published a report expressing concern about the decline in the number of new startups being established in Israel.
Fewer companies are being founded, but the entrepreneurs who choose to do so in times like these tend to be more mature and experienced in their field, says Founding Partner of UpWest VC Fund. says one Shuly Galili. “It’s amazing because when you talk to entrepreneurs who are embarking on this difficult journey, they’re doing it because they want to do it, not because there’s a lot of money in the market. The quality of entrepreneurs who do this varies. [founding companies right now] More mature. For some, this is not their first business, but many already have enough experience in the field they are entering and are much more confident. ”
But these bold entrepreneurs will likely find it harder than ever to raise capital. Galili, who served as executive director of the California-Israel Chamber of Commerce for 12 years, is concerned about the uncertainty surrounding the war. “Investors who have invested in Israel will continue to invest in Israel. It is important to them and the determination, knowledge and ability to take risks with Israeli entrepreneurs has not gone away. It would be very difficult to convince new investors who have invested in us.”I have never invested in a company in Israel to do so. ”
Still, I’m optimistic about the long term. “A lot depends on how we continue to build our economy. If we decide that one of the most important things is to preserve Israel’s high-tech industry; “A lot of people are looking at Israel today and want to understand how we rise from there. “There’s an expectation during this period that we’re going to come out even stronger. We’re going to continue to compete. I don’t think we have the privilege of not meeting this expectation, both in terms of maintaining international companies that are already in Israel today.” ”
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Shree Galili.
(credit:)
When it comes to hiring established startups at the moment, Galili points to two trends. The first is that, unlike in the past, it is now possible to hire from anywhere in the world. The challenge is managing a company whose employees are scattered all over the world. The second trend is a reluctance to hire senior talent. “We are seeing a desire to achieve technical and market feasibility before hiring very senior employees. We are also seeing a desire to achieve technical and market feasibility before hiring very senior employees. We are also seeing a desire to achieve technical and market feasibility before hiring very senior employees. It also stems from uncertainty,” she says.
Galili added that seed investments currently range from $1 million to $3 million, with companies raising money to prove both technical and market feasibility. Companies that are established and successfully raised today must meet higher standards of viability than in the past.
“We know that American VC funds find it very difficult to invest in dreams. If a company doesn’t have at least $1 million in revenue, there’s nothing to talk about. It’s a hope, not a promise. Everyone was hurting,” said Talor Sax, CEO and managing partner of eHealth Ventures.
Regarding the decision to form a startup at this time, Sachs said it was never a good time to start a startup and that in itself was an “irrational” decision. “It’s better to work at Google than to found a startup. I think there are fewer chances to find investors now, so it’s not a good time.”
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Taylor Sachs.
(Credit: eHealth Ventures)
The decline in new start-ups and the increase in business closures due to war and economic conditions only highlight the courage needed by entrepreneurs at this time. Nevertheless, Sachs predicts an increase in the number of startups being founded this year. “The tech industry is going to shrink. Some companies are going to close, there’s going to be layoffs at the tech giants, so there’s going to be more people looking for jobs. They’re going to start up startups. They simply dreamed of starting their own company, but when that job is gone, they will try to make that dream a reality. ”
In his view, incubators offer a good solution, especially in the very early stages of company formation. Also, if the entrepreneur is very talented, he can also raise money from angel investors. “People starting now will raise money at a lower valuation. You can also go to an incubator, but that’s a lot of money. If you go to an incubator, you’ll get a lower valuation, but angel investors “It’s not very sensitive to the market. Market conditions mainly affect it. It’s a seed-stage company that has been running for two years already and has had to deal with lower valuations,” he said. To tell.
But Sachs points out that the bright light in today’s dark market is the entrepreneurs themselves. “We’re seeing an increase in the quality of people looking at entrepreneurship. I hope that becomes a trend and we start to see more startups,” he says.
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