It is not about money and technology… It is all about the people, stupid! Laurie Olivier October 8, 2009
GRADUAL EVOLUTION OF SILICON VALLEY Steve Jobs in front of his garage, where he made the first Apple computer. HP founders Dave Packard & Bill Hewlett in front of their famous garage in Palo Alto, CA
SOME SUCCESSFUL OWN VERSIONS OF SILICON VALLEY … IT CAN BE DONE! Route 128, MA Bangalore, India Israel Zhongguancun, Beijing Hsinchu, Taiwan
THE SILICON VALLEY COMMUNITY = SUCCESS RECIPE CLOSE PROXIMITY Academia & R&D = Technology & Manpower VC’s = Funding & Networks CRITICAL MASS REQUIRED 3 2 Local Networking & Social Community 5 Entrepreneurs & Culture of risk taking SUCCESS STORIES RELATIONSHIPS Government Support & Regulatory Environment CROSS FERTILISATION 4 1 CONVERGING SOCIAL CIRCLES
ISRAELI SUCCES STORY: VC FUNDING = “SILVER BULLET” 2002 • 60 VC’s (>$10B) • $17B M&A deals • >100 IPO’S • #3 in Nasdaq • Cisco, IBM, Intel, MSFT & ROW VC’s • 3000 Start-ups YOZMA 1992 • Israeli Govt invest $8M in 10 VC funds • VC partners with 5 yr option to buy out Govt • 1 VC ($24M) – Veritas/Athena • Success in R&D - Failure in marketing • No M&As • Few IPO’S • Lack of international involvement • 300 Start-ups
‘SECRET SAUCE” FOR ISRAELI SUCCESS Deal Flow/ Technology International Orientation VC CRITICAL MASS 2ND TIME ENTREPRENEURS Favorable Regulatory Environment & Govt Support Proven Track Record Success NB!
TRADITIONAL SA TECHNOLOGY INTERNATIONALISATION MODEL • Most common SA VC model today • First proof tech on local market • Then overseas clients/partners • Company end-up with SA identity • Disadvantages: • Lower entry barriers = Competition other regions • Less global market input during R&D phase • Late start (behind international competition) with development of international relationships • Difficult to exit on international markets
ISRAELI TRANSATLANTIC GLOBAL TECH START-UP MODEL CAN WORK FOR SA • Proof tech on global (US) market • Global (US) marketing presence on Day 1 • Evolution of global management team • Company has a global (US) identity • Company prepares for global (US) exit from Day 1 • Advantages: • Focus on leading global technologies • Global strategic market input from concept to exit • Early development of global relationships • Global (US)identity & track record (req. for US exit)
GOVERNMENT INVOLVEMENT IS ESSENTIAL: MAIN R&D SUPPORT PROGRAMS IN ISRAEL
WE HAVE THE ENTREPRENEURIAL CULTURE • “Can do “ mentality • Pioneering Ethos • Informality is a way of life • Questions authority/status quo • Can be stubborn and some don’t listen well • Not patient, and do not stand in line • Aggressiveness is not in short supply • Boot strap mentality • Make due with less • Learn quickly from mistakes • Believe in miracles
OUT OF THE BOX THINKING .. MOBILE HEATER
CREATIVE RISK TAKING IS ESSENTIAL .. Creative risk taking is essential to success in any goal where the stakes are high. Thoughtless risks are destructive, of course, but perhaps even more wasteful is thoughtless caution which prompts inaction and promotes failure to seize opportunity.
LET’S MAKE IT HAPPEN!!! THANK YOU