Growing a startup is hard enough, but doing so in a foreign market adds a whole new set of challenges and complexities. Misaligned expectations, unfamiliar business practices and cultural differences can have a dramatically adverse impact on the startup, despite the strong foundational skill set that Israeli founders often possess. Join Gil Ben-Artzy, UpWest Founding Partner, for an interactive talk on the most common traps Israeli founders fall for in the US market, and how they can be avoided. Gil’s takeaways are based on UpWest’s experience building the largest portfolio of Israeli startups headquartered in the US. Since 2012, UpWest has invested in 80 Israeli startups targeting the US market that have raised over $600M, including companies such as SentinelOne, Airobotics, and HoneyBook.

1. Common Traps Israeli Founders
Fall for in the US Market
Gil Ben-Artzy
JANUARY 13, 2019

2. WORK
LIFE
EDU

3. - 3 -
Early Stage Fund Investing in
Top Israeli Founders
Domain AgnosticPre-Seed & SeedUS-Bound
70+ Institutional>$600M
Strategy
Portfolio
Follow-on Funding
Largest Portfolio of Israeli Startups HQed in the US
85% US

4. Traditional
Industries
Drones Augmented &
Virtual Reality
Deep
Learning
Infrastructure
Technologies
Internet of
Things Marketplaces Cyber Security
Artificial
Intelligence eSports
Mobility
Digital Health
- 4 -

5. Case Study:
Launching & Scaling in the US
Tomer Weingarten, CEO & Co-founder, SentinelOne
2013 UpWest Invests; Customers,
Advisors, Seed Round
2014 Series A, Exec Hires
2015 Series B
2016 Rapid Growth
2017 Series C
2018 400+ employees
- 5 -

6. Context for this Talk
No “truth”; always exceptions
Focus on traps relating to:
• Mindset & preparation
• Gaining momentum
• Establishing presence
Please ask questions throughout
- 6 -

7. US Market: Benefits & Reality
Customers
Employees
Investors
Culture
High value, open for beta (esp. SV), in-person
Tech talent at premium, hard to retain
More options, more $, higher valuations, higher expectations
Different than expected….
Competitors Tough, well connected, “talk the talk”
Market Breeds huge companies, often gateway to ROW
- 7 -

8. Believing Your Homegrown Street Cred Is Transferable
Academic & military experience
Israeli customers & investors
Corporate programs
Press coverage
- 8 -
1

9. Believing Your Homegrown Street Cred Is Transferable
No one is dialing +972
Immerse yourself:
• Local POCs
• Social proof
• US talent
- 9 -
1

10. Mistaking Fake Validation as Real Feedback
Israeli customers, wrong type of customers
Corporate Innovation Labs
Funding & investors
Awards & “Top 10” lists
Industry echo chamber (US/Israel)
- 10 -
2

11. Mistaking Fake Validation as Real Feedback
Fear of building wrong product outweighs fear of “burning yourself”
Focus on representative customers in your target market
- 11 -
2

12. Being Product-Centric as Opposed to Market-Centric
“What we do" vs. "why we do it“
Storytelling focused on customer's
pain & market opportunity
Understanding regulations as a
competitive advantage in the market
- 12 -
3

13. Aiming too Low, Not Building a Long-Term Vision
Customers reluctant to commit long-term
Tough to recruit top talent
VC economics demand certain type of outcomes…
- 13 -
4

14. Which Startups Did Your Target Investors Previously Fund?
- 14 -

15. Aiming too Low, Not Building a Long-Term Vision
Not an afterthought
Demands full dedication
Higher stakes
- 15 -
4

16. Setting Up Shop in the Wrong Ecosystem
Treating the US as a single destination
First sign of traction dictating geographic focus
Choosing location because of lifestyle
- 16 -
5

17. Setting Up Shop in the Wrong Ecosystem
Three key considerations:
A. Find the right first customers
- 17 -
5
Right vertical, size, type
Set up to work with startups (risk, feedback, speed)
Critical mass in same area

18. Setting Up Shop in the Wrong Ecosystem
Three key considerations:
A. Find the right first customers
B. Early-stage investing is (mostly) a local business
- 18 -
5
Mentor
Leverage network for hires, customers, funding
Manage risk, focus when already living next to them

19. 140
36
22
Silicon
Valley
New
York
Los
Angeles
Series 1
252
61
43
Silicon
Valley
New
York
Los
Angeles
Series 1
57
13
8
Silicon
Valley
New
York
Los
Angeles
Series 1
Cumulative Investments
($B, 2012 – 2018)
Tech Unicorns
(2018)
Tech Exits >$100M
(2012 – 2018)
Source: CB Insights, May 2018
US Tech Hubs
- 19 -

20. Setting Up Shop in the Wrong Ecosystem
Three key considerations:
A. Find the right first customers
B. Early-stage investing is (mostly) a local business
C. You need to be where the talent is
- 20 -
5

21. Hiring a “Ghost CEO” to Act on Your Behalf in the US
Hiring local Head of Biz Dev / Sales / Partnerships:
• Left out of the decision-making process
• No authority in eyes of customers, partners, investors
• Cultural gap, lack of trust from Israeli team
Often fails, causing significant loss of time & money
- 21 -
6

22. Hiring a “Ghost CEO” to Act on Your Behalf in the US
OK to hire non-lead roles to help with lead gen, early marketing, etc.
CEO should be lead customer meetings, talk to investors
CEO should spend more time in the US…
- 22 -
6

23. Showing Up Sporadically and Expecting to be Noticed7
Arriving every few months, cramming meetings into a week
Relying exclusively on video calls
Going on 2-week fundraising roadshows
- 23 -

24. Showing Up Sporadically and Expecting to be Noticed7
Make the US part of your routine
Plan 4-6 weeks ahead, visit for at least 2 weeks (anchor meetings,
conference, only 50-75% planned, “Stand in Luck’s Way”)
Always follow up, plan your next trip
Increase frequency of visits with momentum…
- 24 -

25. 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.”

26. Summary
Showing Up Sporadically and Expecting to be Noticed7
Hiring a “Ghost CEO” to Act on Your Behalf in the US6
Setting Up Shop in the Wrong Ecosystem5
Aiming too Low, Not Building a Long-Term Vision4
Being Product-Centric as Opposed to Market-Centric3
Mistaking Fake Validation as Real Feedback2
Believing Your Homegrown Street Cred Is Transferable1
- 26 -

27. Thank You
gil@upwestlabs.com