Nofar is an Associate at StageOne Ventures. She brings experience in assisting startups within the tech sector as well as mentoring and escorting teams to build sustainable world-class tech products. Prior to StageOne, Nofar was the CTO and Technology Analyst at Nielsen Innovate, an Engineering Manager and Software Engineer at XM Cyber, Here Technologies, and Nokia (formerly Alcatel Lucent). She has extensive experience with Geo Locations, Network Protocols, Cloud platforms, Databases, and various programming languages. Nofar is an 8200 alumna and holds a B.Sc. from the Interdisciplinary Center Herzliya and a M.Sc. in Management from Tel-Aviv University.
- How did you get into Venture Capital?
I was a Software Engineer and an Engineering Manager for over 10 years before I have joined Venture Capital. I always liked to see the bigger picture when working on a product and look at the solutions that were being developed for the market needs. I was always curious to hear about different startups friends and acquaintances were working on.
When a friend of mine asked me to replace him at Nielsen Innovate, one of the Israeli Innovation Authority Incubators, I thought he was crazy, but after thinking and learning more about the Venture Capital industry, I felt it was exactly what I was looking for. It was the perfect mix of technology, startups, and people.
A few months ago, I was lucky to join StageOne Ventures as an Associate, an experienced early stage fund who leads investments in exceptional Israel-related startups focused on solving large enterprise challenges.
I wrote a blog post about my move to VC
2. What is the startup scene like in Israel?
Israel in general is a very friendly country where everyone knows someone who went to school/army with someone. The fact that it is a small place works in our favor in many ways, this especially in relation to the Israeli startup scene.
Israeli entrepreneurs have the “can do” attitude. You will find many entrepreneurs that not only believe things can be done in a better way but will act to change them. They have what is known as “The Israeli Hutzpah”. They will always find a way to connect with people without hesitation.
These unique characteristics greatly assist Israeli investors and entrepreneurs. You can create great connections, meet and network very easily in comparison to other geographies.
3. What is the future of venture capital post this coronavirus climate?
Currently, VCs are still investing, especially in specific areas that were not affected by COVID (e.g. Cyber Security, Software, and Cloud solutions). Some fields were severely hit, especially in the travel and tourism industry, and it will take time to recover.
Nobody really knows what will happen, my guess will be that investors will be more cautious and will make sure to avoid investing in COVID-only related startups. Furthermore, they will look for solutions that can be sold in a ‘low touch’ process.
I also believe that VCs will be more conservative and keep some of the funds to back their current portfolio companies.
4. What is your investment strategy when investing in startups? (How do you choose the good from the bad)
When you are investing in a startup, you are mainly investing in 3 things: the founders, the market, and the technology. So, when I talk to entrepreneurs, I want to see how they have thought about these three things. I always ask about their roadmap and plan, how well they know the market they are getting into, who are their competitors and why they are different. It is also important to see how they cope with suggestions, feedback, and criticism and how open they are to new ideas.
Due diligence is also key. As a VC we see many companies trying to solve the same problems in different methods, the key is to know which one is going to be your “winner”, which one is different and worth investing in. We look at startups that can solve a big enough problem that down the line can make a large exit which can make a difference for our investors.
Since I come from a technological background, it usually helps me identifying the ones that have a strong technical background and can lead the technological side of a startup.
At StageOne Ventures we are looking for early stage ventures that have a brilliant solution, backed by strong technology, for a real problem enterprises and companies are facing. We want to invest in startups that will grow and succeed, but also bring something unique to the table.
We assist entrepreneurs during their entire journey, from the beginning to building their business, scaling and hopefully until they exit. This means the relationship with our founders needs to be solid. As a VC we always remember that we do not sit in the driver’s seat but next to it. I believe our passion, strong commitment, extensive industry experience and vast personal networks, allow us to offer our portfolio companies the best possible support.
5. What are the most common issue startups have when they pitch for funding and how can they resolve it?
I think that most startups forget to put themselves in the investor’s shoes. They are so focused on what they want to do and present, that many times they fail to get their message through. An entrepreneur also needs to remember that the VC might have seen a similar solution to theirs more than once, so they need to be on their A game when it comes to differentiation and knowing the market.
If I cannot understand the need and the solution, how will your customers understand it?
It is helpful to present the need and solution using different use cases, this will help display that your solution is solving a real problem.
Sometimes entrepreneurs forget to differentiate themselves, whether technologically or conceptually, and they do not always listen to the questions they are asked, and answer with the information they want to provide instead.
The worst thing is to arrive not prepared to meetings. A VC has a limited amount of time and meets hundreds of companies every year, so before you come to the meeting learn about the VC, who is part of the team and in which companies they have invested before.
Speak to a few of their portfolio companies and make sure they are the right fit for you. Remember, you are asking someone to join your journey, you should know who you travel with. These things are super important. It says a lot about the team and their capabilities, and we always take them under consideration when we invest.
6. What advice would you give to young budding entrepreneurs?
The best advice I can give is to pick your partners and co-founders for this journey very carefully. You are going to be in this together for a long time, a lot of it will be stressful and difficult.
I always say it is even harder than dating. If you are not technical and looking for a technical person, make sure that this person is up for the job. From my experience, finding a CTO after the first CTO left is very hard and sometime it is too late – you already have a product that needs maintenance, especially if you already have customers, and technical employees that need guidance by someone experienced.
I also advise to ask yourself the toughest questions and challenge yourself, take criticism and learn from it, because investors and customers will challenge you, and you want to be able to give them the best answers. Keep an eye on your current and future competitors and treat competition as a good thing (as long as you are able to deal with it).