Presentation on theme: "New Opportunities for Direct Investment: Life Beyond VC Jon Medved CEO, OurCrowd Prepared for DC Finance Annual Family Office & Wealth Management Conference."— Presentation transcript:
New Opportunities for Direct Investment: Life Beyond VC Jon Medved CEO, OurCrowd Prepared for DC Finance Annual Family Office & Wealth Management Conference
Massolution: Crowdfunding portals will raise $5.1 billion in 2013 – nearly double the amount raised in 2011 Consumer Lending Rewards-based Donations Venture Capital 2 Market Disruption: Crowdsourcing in Finance Source: Deloitte TMT Predictions 2013 “Let's get together: crowdfunding portals bring in the bucks” “Venture capital-type crowdfunding is the wild card for 2013. It could raise more than a billion dollars …” Source: Massolution Crowdfunding Industry Overview 2013
3 The recent acquisition of Oculus raises questions Rew ard-based crowdfunding: Where is the Reward? Now investors are asking why do I only get a tshirt? Andreesen, Spark, Matrix Partners back Oculus Rift with $75M Series B… then Facebook acquires the company for $2B December 2013 … March 2014 After raising $2.4M from Kickstarter, Oculus Rift gets the attention of major investors Naturally, this plays into the rise of equity crowdfunding platforms Pays $2B for company and Original crowd funders get nothing
Angel InvestingAngel InvestingVenture CapitalVenture Capital 4 Legal issues/termsheets handled by firm Exposure to top dealflow Professional due diligence Preemptive/other rights Independence, self-selection Low fees No large upfront commitment Relative speed and ease Large Commitment Hefty management fees Carried interest fees No control, no choice Very limited dealflow Term sheet negotiations Limited due diligence capabilities No protection, no rights OurCrowd offers the professionalism and experience of a venture fund, plus the flexibility and choice of angel investing
Global leader in equity crowdfunding, just 15 months after launching Raised over $50M for 40 companies 20 companies with over $1m raised, 2 deals over $3M First follow-on deal funded in 4 hours, 14 follow-on deals on OurCrowd, with 16 of our portfolio doing follow-ons total High-quality, continually improving pipeline of new & international deals 5000 Accredited investors, 500 active Average active investor committed to almost $100K on site Experienced investment team - 150 years combined VC experience Portfolio companies doing very well 5 OurCrowd Overview
“Crowdfunding for real investors” (TheStreet.com) Growing Differentiation from the rest of the pack Currently Selecting 2% of the deals we are pitched We always Co-invest with crowd Accredited investors only Managed investments via SPV Good for companies (one check), Good for investors (protections, rights) Truly International ( active investors from 26 countries) Focus on Follow-on rounds bearing fruit Mentors program is unique Taking Board seats in 65-70% of companies “Crowdbuilding” resonates and works Co-investor list is indeed impressive Our goal is to be the “smart money” in crowdfunding
OurCrowd’s Investment Model 7 Accredited Investors Management OurCrowd International (GP) OurCrowd management company OurCrowd investment vehicle GP Special Purpose Vehicle Control Portfolio Company Investment
Enabling paraplegics to walk 9 Paraplegics face immense social and medical difficulties living wheelchair-bound. Israeli entrepreneur Dr. Amit Goffer developed the ReWalk for over a decade to produce a device uniquely capable of alleviating key medical complications that come from a paraplegia and allowing paraplegics to walk, climb stairs, and even complete marathons. Argo – advanced robotics allowing paraplegics to walk again
Feeding the world: water Farmers waste hundreds of millions of dollars worth of water – driving up prices and reducing supply for those most in need of affordable water – because they’re spraying water uniformly across their fields. A mobile app that enables farmers to finely control where their water goes is already saving countless cubic meters of water internationally. Varigate – the world’s most affordable water Israel recycles 75% of its water, #1 in the world. By comparison, #2, Spain, recycles just 11% of its water. “Israel should be proud of being at the forefront of green innovations for water management; these innovations can be decisive in managing scarce water resources” – Angel Gurria, OECD Chair Israeli water tech impact Did you know that Israel is recognized by the OECD, WWF, and UN for being a water tech powerhouse? 10
Fighting the most deadly killer: malaria Malaria has killed millions in the past decade and is among the diseases with the highest toll on human life and economic activity worldwide. Despite this, diagnostics tools used in the prevention and treatment of malaria worldwide remain expensive, slow, and insufficiently accurate for mass implementation. SightDX’s computer vision technology reduces the time to diagnose from several hours to minutes, while being more accurate and substantially cheaper. The story of SightDX being founded and built by a diverse group of people pooling their personal intellectual strengths is the archetype of the Israeli startup. Israel’s interdisciplinary strengths Sight Diagnostics represents the convergence of two key Israeli strengths: life sciences/biology and machine vision/advanced algorithms 11
Israel's unique demand for the fastest, most innovative technologies in emergency alerting forced eVigilo to produce the world’s leading mass alerting system that is now used by governments around the world as a core part of their disaster preparedness plans. Chile’s 2010 earthquake and tsunami took over 520 lives as millions were left without means to communicate or be alerted to the post-quake tsunami for up to 12 hours. In the minutes after the 2014 earthquake, Chile activated eVigilo’s newly-implemented system and effectively alerted several million people in tsunami zones to evacuate. Saving lives by learning from Israel’s experience Case study: Chilean earthquake ‘14 12
VocalZoom Semicon/components company whose product enables effective voice communication and recognition in even the most noisy environments. “Optical microphone” monitors vibrations on speaker’s throat and face, helping to isolate speech from background noise. 13 Technology implementation update Yechiel Kurtz, CEO, held a successful meeting with President of Samsung Mobile R&D group. VocalZoom will be running tests with engineers in Korea in May 2014. Strategic investments at this stage in the company’s development are an open potential.
Consumer Physics (SCiO) Miniaturized near-IR spectrometer, allowing for first hand-held molecular sensor. Applications: measuring nutritional information in foods, identifying allergens, authenticating precious metals and leathers, etc. Co-investors: Khosla Ventures, Dov Moran 14 Product launch - $1.2M in preorders Product launch on Kickstarter at $200 price point saw over $1.2M in pre-orders within a week. Rave reviews in media: VentureBeat, Validation of strong demand for consumer- friendly health-focused devices at ~$200 price point.
Zula Revolutionizing team communications with cross-platform mobile messaging application. Called “Whatsapp for business”, Zula’s core value is its focus on consolidating communications for teams into one location and focusing on team-centered functions above those offered by existing consumer solutions. Co-investors: Microsoft Ventures, Mort Meyerson (EDS) 15 Founders are giants in the comm. space Above: Jeff Pulver, Chair & Jacob Ner-David, CEO Jacob Ner-David founded and exited three communications companies, the largest of which was Delta Three, which he took to IPO on NASDAQ with a market cap of ~$1.8B. Jeff Pulver was the co-founder of Vonage and pioneer of VOIP technology and early legislation.
Highcon Moving conventional packaging production from analogue (die-cutting) to digital process (one-button operation). Opens new possibilities for packaging – short and medium runs, high-value packaging in small quantities, labor savings, etc. Co-investors: Benny Landa (Indigo, $800M acquisition by HP) 16 Israeli expertise in digital printing Israeli entrepreneurs brought Scitex, Jemtex Printing, Objet, XMPie, and Indigo to the world market, securing major exits to multinationals like HP and Eastman Kodak. Indigo, which HP acquired for $800M to absorb its digital printing technology, was started by Benny Landa, a Highcon investor. Current opportunity: Raising $15M for expansion. Strategic investment possibilities.
17 MUV Pioneering solution for interacting with multiple screens through touch, gestures, and voice input. Proprietary integration of optics and wireless tech makes its product the highest accuracy, most versatile and substantially cheaper than any options available today. A look at MUV’s product CEO Rami Parham demonstrates MUV’s fine- detail control over a projected image. MUV’s solution is both available in a small, unobtrusive add-on, as well as a sensor capable of being embedded within projectors by OEMs.
18 Takes Advanced, patent-protected camera app eliminates the need to choose between taking a photo and video. Takes captures video and metadata including accelerometer inputs, allowing the user to take still images but to produce a full-motion video after-the-fact from the moments captured while photographing. Israeli expertise in computer vision CEO Amit Man is an expert in computer vision and machine learning and lead algorithm and core development at Israel’s Briefcam. Israeli companies like Briefcam, Mobileye, Rafael, Elbit, and more.
19 Curiyo Lightweight application (browser plugin or embedded into websites) allowing content publishers to deliver in-context information to users when they ask for it. Founded by Bob Rosenschein, serial entrepreneur who founded Answers.com – top 20 web property in the US. Early traction with major publishers Curiyo launched its first major publisher partnership with USA Today, running its application embedded into the Life section online – a top 10 US news property online.
20 NextPeer Fastest growing mobile multiplayer network for Android and iOS with over 70M users. Provides back-end for developers to quickly deploy their games as full- blown multiplayer games in 10 lines of code, without the headache of maintaining server load themselves. Evaluating NextPeer’s virality NextPeer’s user adoption rates surpassed 1.5M per day during recent peak periods, as reported in a VentureBeat article looking at the network’s explosion. By providing the backend for game developers to make engagingly multiplayer products, NextPeer is able to “latch onto” the growth of viral games like 2048n or Candy Crush and grow as the games pick up gigantic user bases.
21 Parko Mobile app with proprietary, protected algorithms analyzing 8 inputs from phones to predict parking behavior of users, passively inserting users into an ecosystem of drivers looking for and leaving parking spaces. Parko continually monitors streets to build a map of parking availability likelihoods for each street at any given moment. Technology’s applications Parko’s unique behavioral analysis and motion recognition engines are being licensed to 3 rd party applications, branded as Motionize. Parko is also pioneering the next generation of “ETA” – mapping applications that tap into Parko’s predictive map to include estimated parking time.
22 Nativeflow Complete enterprise data security solution for BYOD IT setups. Nativeflow secures any data on any device and inside of any application being used by employees. It runs invisible to the end-user, allowing employees to enjoy the “native” user experience that motivated them to bring their personal devices into the workforce in the first place. The deep technology behind their solution is protected and patent- pending. Experienced, successful management team Nativeflow’s management team has a history of success in the security space. CEO Eitan Bauch was co-founder of and sold Navajo Systems to Salesforce, was CEO of Magnifire, which was sold to F5.
23 Co-investing with leading investor groups Top-tier funds and institutional investors
24 Co-investing with leading investor groups Top-tier funds and institutional investors * Investor opting for anonymity
OurCrowd’s Leadership Team 25 Jon Medved Co-Founder & CEO Washington Post: "one of Israel’s leading high tech venture capitalists” 12 exits >$100M Co-founder, CEO of VRNG Founder & GP Israel Seed Partners, $260M AOM Elan Zivotofsky General Partner Investments 15yrs experience in Israeli investing Managing Partner at Prelude Israel Former Head of Technology Banking, Lehman Brothers Israel Top-ranked Israeli tech research analyst for Goldman Sachs Steven Blumgart Co-Founder & Chairman Co-director of Glencore's aluminum division Senior executive, management committee at Glencore 1998-2012 Pini Lozowick General Partner General Partner at Alta Berkeley Among first employees at Broadcom, Dir. Marketing Chairman of Provigent Founder and GM of Verisense 5 exits; total value $3B Geoff Levy Chair of Advisory Committee Extensive experience in law, banking and investing Non-Executive Chairman of Monash Private Capital, Specialty Fashion Group and Cromwell Property Group Non-Executive Deputy Chairman of Investec Bank (Australia) Limited Gadi Mazor General Partner & CTO Serial entrepreneur in mobile/wireless US Senate Advisory Board RIM entrepreneur of the year 2013 Ex-8200
OurCrowd’s Leadership Team 26 Evelyn Rubin, BizDev Partner JVP, Senior Editor @ SeekingAlpha Zack Miller, Investor Community VP Biz Dev @ SeekingAlpha Robbie Citron, CFO Partner @ Jerusalem Global Ventures Jay Kalish, SVP & General Counsel VP IR @ Allot, CEO Patir Tech Audrey Jacobs, VP BizDev M3 Marketing Danna Mann, Biz. Strategies Partner Biz Dev at JVP David Stark, dealflow Blackstone David Arnovitz, COO Founder of S1 and Secureware
27 Mentor Program Eli Campo - GM Israel @ LivePerson (NASDAQ LPSN) - SVP @ Shopping.com/Ebay Israel Raanan Gewirtzman - CEO Broadlight (sold to Broadcom $200M) ProfileRoleRole in companiesRelationship - seasoned entrepreneurs - experience with board seats - active role in diligence - pre-funding review of companies - directors in OC companies - also availability for consultation - biannual mentor- company event started June 27th Some recently joined mentors Dov Rubin - Co-founder of NDS (sold to Cisco, $5B) - CEO Itamar Medical Ron Moritz - GM @Microsoft - SVP CTO @Symantec - SVP Chief Security Strategist @CA Mike Berman - President Cardiology @ Boston Scientific - Serial entrepreneur in medical device space Warren Adelman - CEO GoDaddy - VP at McAfee - VP at Bigfoot International
28 6 Key Investment Criteria Great Team Addressable Market Simple Value Proposition Value Sponsorship Traction 1. Great team: Successful startups are founded by great people. We pay special attention to successful serial entrepreneurs. 2. Market: The startup must address huge market growing like a weed. No arcane ideas addressing niche markets. 3. Easy to understand: a simple value proposition. Easily understood by us AND by “our crowd”. 4. Traction: Investing in early stage companies, but not just ideas or pre-prototype. Early product, users, customers, partners & revenues 5. Sponsorship: Investing in startups/building early stage companies is a team sport. Board, advisors, smart investors 6. We seek “deals” and are value-sensitive.
29 Serial Entrepreneurs/Strong Backgrounds Bob Rosenschein Founded Answers.com ($127M exit), Accent Software ($400M on NASDAQ) Dr. Amit Goffer & Larry Jasinski Founded Odin Medical Technologies (acquired by Medtronic) CEO Soteira (acquired by Globus), Cortek (acquired by Alphatec) Jeff Pulver & Jacob Ner-David VoIP pioneer, founded Vonage, VOX, FWD, investor in Twitter and Foursquare Founded Delta Three ($1.8B NASDAQ), founded Nomadiq Benny Landa & Aviv Ratzman Indigo, major global force in digital printing; HP acquisition ~$800M
30 Serial Entrepreneurs/Strong Backgrounds Richard Demb Founded GC Zone, Founded Popcorn Indiana (acquired by Goldman Sachs) Eitan Bauch & Avi Yehuda Collectively sold startups to Intel, F5, Salesforce.com Zvi Schrieber Founded TradeUM ($500M exit), Unicorn (acquired by IBM), Lightec (acquired by GE) Benny Rosenbaum Co-Founder Magic Software (Nasdaq: MGIC) Isaac Bentwich Founded Rosetta Genomics (Nasdaq: ROSG), Pegaus Medical (acquired by McKesson)
31 Not just capital – we’re creating opportunities “I am excited about the value that OurCrowd brings to early stage investors who invest in startup companies. Not only did we raise our seed round on OurCrowd in a week, but we had people from all over the world invest in Zula thanks to this platform” Jeff Pulver Co-Founder, Zula “I am excited about the value that OurCrowd brings to early stage investors who invest in startup companies. Not only did we raise our seed round on OurCrowd in a week, but we had people from all over the world invest in Zula thanks to this platform” Jeff Pulver Co-Founder, Zula
32 Co-investing with leading angel investors Gigi Levy 888 Amdocs Moshe Lichtman Microsoft Rami Lipman Microsoft Israel Benny Landa Indigo Yigal Jacoby Allot Communications Ajay Shah Silverlake Sumeru Shah Capital Partners Gideon Ben Zvi Briefcam Tzachi Sultan Clal Underwriting Mort Meyerson Dell EDS
33 Announcing Strategic Co-Investment Agreement with General Electric Ventures Sue Siegel, GE Ventures CEO :“OurCrowd has created a unique platform for dynamic early stage origination and funding. They offer a quality investment environment and the partnership will give GE increased access to early innovation.” GE will co-invest with OurCrowd in select early stage companies in the areas of energy, healthcare, software and advanced manufacturing Investing on the same terms as our members/investors. First time major corporation has made such a commitment to an equity crowdfunding platform Huge validation for OurCrowd.
34 Press Coverage “The 5 Most Important New Companies You Need to Know” Forbes Online “An Israeli company trying to change the way startups are funded” CNN Business 360 “Medved's latest mission is to blow up the exclusivity around tech fundraising” Bloomberg BusinessWeek "The most interesting investment of the week goes to OurCrowd” Wall Street Journal “The platform has been an enormous success…the ultimate win-win-win situation, brought to you by an new and improved Israel – innovative & confident.” Haaretz “Crowdfunding for real investors” thestreet.com
35 Press Coverage in 2013 South African Business TV
Summary Meeting a demand for a better online way to invest in startups Platform works—Raised record sums ($50M+) for 40 companies online Industry-leading performance to date – worldwide leadership Strong Israeli base, global investor reach into 60 countries, 30 active countries Over a third of our recent deals originate from outside Israel Recruited industry-leading team Strong and impressive initial portfolio 16 companies have completed additional funding rounds after initial funding Have provided real value-add for our startups Achieving strong traction in a gigantic market 37