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00:00:01
"If you can choose between being kind or being right choose kind" said our little Lapin
149 Plays1 year ago
When you're moving as a family, the only common denominator you have is the family, so you stick together and you make sure that everybody goes through the experience in the smoothest way possible.
20 YEARS IN PERSPECTIVE:
Quite a ride, it brought me through 5 different locations (Switzerland, France, Spain, Andora, Bulgaria and now Israel), 9 or 10 different positions and all with this desire, this intent to actually revolutionize to some extent a quite old and legacy industry and move it into something closer to the twenty first century.
We've always wanted to be kept on our feet, to put ourselves in challenging situations, facing new unknowns over time probably in order to avoid complacency and comfort of just having a very, well-organed life.
The more the company was offering new locations, the more we felt it was just not the right thing to do. And the right thing to do was to stay here, to live in Israel, to become Israelis, to develop our kids here in this country.
The biggest challenge has been to advocate for this smoke-free world as part of Philip Morris, to come in as a representative of the largest, you could say, death enabler from some perspective of avoidable death, by selling cigarettes and being listened to and considered by anti-tobacco activists, by political stakeholders, by community leaders has been very challenging and quite painful and quite tough at times.
One of the biggest personal changes was also to manage our parents from a remote perspective, parents who are getting older and don't have their grandkids around them.
I had a stint at startup and eventually things weren't exactly the way I was expecting them to be. I found it to be way more complex than I guess I naively thought and actually quite cynical. Overall I understood what it takes to be an entrepreneur and to be part of a startup and to manage it and it turned out that it was not really my thing, so it was a great experience but it didn't really hit my DNA in the way I thought it would.
What I'm doing at Catalyst Investments is actually offering selling or setting up a platform in the form of a venture capital fund for corporates that want to create a portfolio of startups in Israeli innovation.
ON TOPIC: All things Israel, start-up scene, ecosystem, Israeli culture
You have now more than 90 unicorns out of Israel, which is the highest number for a single country in the world, number of startups per capita and investments.
I think it's the country that invests the highest percentage of GDP into education, over nine percent of Israel’s GDP is going to education.
Israel had always been a bit of a dream destination, something that I was, we were very keen in experiencing.
[Israel] is still a pilot project as a country, it's a 75 year old country made of a melting pot of people that have immigrated from over 80 countries so it's still all in development.
The Israeli Innovation Authority is really fuelling and funding not only with money, but also with support and with networking capabilities the entrepreneurs and their ventures.
There's more 380 VCs present in Israel providing funding.
All THINGS INSEAD AND GIVING BACK
INSEAD is so intimately linked to most of the things that have happened to me. It's not only about giving back to be connected and to participate and to be active about it.
I don't see INSEAD as just a place where we learn things, or we developed a great network and friendships. It's really a foundation step in what has happened to me and my family over the past twenty years.
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Transcript
Introduction to Republic of Insead Podcast
00:00:00
Speaker
This is Republic of Insead, the 20 years later O3D podcast edition. I am Milena Ivanova and will be your host in this limited series. So, here we are, 20 years later, hopefully all the wiser, naturally smarter and as charming as ever. There were 432 of us in the O3D vintage.
00:00:25
Speaker
And certainly there are 432 unique and very interesting personal and professional stories to tell. While I cannot physically cover all, I have tried to make a selection of stories that will keep you interested and curious and will hopefully convince you to join us on campus for reunion. Welcome to the Republic of Insead Podcast Edition and enjoy the show.
Quirky Stories and Adventurous Spirit
00:00:50
Speaker
Et Voila! Our little lapin! One of the most helpful guys I have ever met. He was the only one to help me throw a beautiful iron bed out of my window. And his assistant setting up parties and dealing with burglars was invaluable. Only bunny that could tell the difference between crystal and Dom Perignon by smell.
00:01:13
Speaker
And who would believe a bunny like that likes fine arts? But there's another side to that little bunny. At the ruche party, the sicko dyed his hair red and went insane dancing with drag queens and chugging champagne from the bottle. In another instance, our friend was on a ding ding with a Frenchman and a Brit off the coast of Corsica trying to raid other sailboats at 4am.
00:01:43
Speaker
Of course, this was after drinking high-end Swiss pear liqueur. More like some bunny that rocks the party if you ask me. End of quotations.
Guest Introduction and Playful Memories
00:01:54
Speaker
This is my guest today, ladies and gentlemen. Have no idea if you know who I'm talking about, but he was a teammate of mine in P3, I believe. So I know something about that bunny, but I didn't know about the Dom Perignon and the Crystal. So welcome to the Republic of Insead podcast, first of all.
00:02:13
Speaker
Second, any reasonable explanations on the above, like the throwing out an iron bed out the window? Who wrote your profile? Do you remember? Do you know who this person was? Yeah, of course, of course. Who was it? Who is it? It was certainly Vip, Vip, my good old housemate at... What was the name of that? Bois Millet, right? That was the name of this kind of a house slash chateau.
00:02:40
Speaker
That was a good 30 minute drive from inside from Fontainebleau. Quite a dangerous drive if you ask me during some of the party nights. But we had a blast there and indeed he inherited one of the smaller rooms and we had to kind of refurbish it and there was this legacy old iron super heavy bed that we just couldn't move out of the door and the staircase so there was only one way out and I was through the window.
00:03:09
Speaker
Such a great lad. Do you still drink dolmen crystal? No, no, no, no. That was all part of the reputation. I was trying to instill it in CN, but people can just see through it right now. All right. There you go. Well, welcome and let's start.
20-Year Career at Philip Morris
00:03:28
Speaker
Tell us where you've been the last 20 years and what are you up to?
00:03:33
Speaker
Wow, 20 years. Well, I think as everybody mentioned on these podcasts, I mean, 20 years just flies. I mean, you know, we've been having on and off conversations over these 20 years, right, Milena? Because we've been keeping in touch quite frequently. So this feels just like one other of these catch-ups.
00:03:51
Speaker
And I've been following what you've been up to and all the adventures you've been going through. And I must say that what you're doing for inside and for the community is really commendable with the fun, with the endowment, with these podcasts, with the organizing sessions and getting us connected and together, the WhatsApp group and whatnot. I think it's really brilliant. And thank you so much for doing that. Look, over the past 20 years, what have I been up to?
00:04:21
Speaker
Well, essentially I've been trying, I guess, to do something that I could feel was meaningful. So somehow getting some sense of purpose and being present and active on a subject that could actually make a difference. And that's why, surprisingly, I ended up working 16 years at Philip Morris
00:04:45
Speaker
the cigarette maker, which sounds a bit counterproductive or intuitive. And if you ask me today, it still feels so. But I must say that it was quite spot on in terms of that desire to work on something that could really make an impact. Because indeed, out of the 1 billion smokers out there, if we can provide them with a solution that helps them move out of inhaling smoke and therefore improving their life
00:05:16
Speaker
lifestyle, daily life and overall longevity that I found was a very interesting endeavor to pursue. And I worked for them all the way up to 2019, 2020, so no longer with them anymore. But it was quite a ride. It brought me through five different locations, nine or 10 different positions. And all with this
00:05:39
Speaker
this desire and this intent to actually revolutionize to some extent a quite old and legacy industry and move it into something closer to the 21st century and actually transforming it or turning into
00:05:58
Speaker
I wouldn't go so far as to say a force for good because that would be a bit of a stretch, but let's say a contributor to overall public health, which sounds quite a dichotomy, but actually, you know, one billion smokers, if you can improve their
00:06:16
Speaker
their expectancy and their longevity, that's higher than the combined impact of many vaccines and other solutions that have been derived. So it was a great ride, a lot of fun. It brought me through Switzerland, France, Spain, Andorra, Bulgaria, your home country. Exactly. I was waiting. Well, we had a blast in, when was it, 2012, 13, 14, and then finally to Israel.
00:06:44
Speaker
where I came here, which is where I live now, to lead the Israeli market and where we decided to stay and live, but we'll talk more about that later.
Transition to Venture Capital
00:06:57
Speaker
Then I had a stint at startups working for a company that is developing a novel alternative biodegradable and water-soluble plastic.
00:07:09
Speaker
So to solve the problems of marine and ocean plastic pollutions. So a very hot topic, very much in need, quite complex to realize indeed with the great experience and a lot of learnings there. And then I decided to combine this experience from VC to
00:07:32
Speaker
that I got through the startup experience, but also through my work at Philip Morris when I was interacting with the startups themselves.
00:07:40
Speaker
the corporate aspect and putting that all together to join the world of VC, which is what I'm doing now, and help corporates actually create and manage a portfolio of startups or growth companies here in Israel to equip them with the technologies and innovations that they need for their strategic purposes, their growth, their operating hurdles or the likes.
00:08:07
Speaker
So quite exciting and indeed putting together a bit of all the experience I've accumulated over these 20 years.
00:08:14
Speaker
And family-wise? And family-wise, I've been quite active, too. Well, actually, my wife has been more so with her four kids, born a bit in all of the different locations where we've been living. So in Switzerland, in Spain, in Bulgaria. And yeah, the youngest is 10. The oldest is 18. Started the army here in Israel. She signed up for two years and eight months. So quite a new adventure for the whole family,
Family Life and Multicultural Experiences
00:08:40
Speaker
too. But very proud of all of them and doing great here.
00:08:44
Speaker
All right. So how, so you said you moved to Israel 2018 or 2014, 14. Okay. So it's almost 10 years now. Yeah. It's like a good nine years. Yeah. So
00:08:59
Speaker
Let's talk a little bit Israel because you have now, you've gotten involved with the startup scene and you came as an expert, but now you're a local, you've taken the citizenship. So a bit of an outsider becoming an insider. So how do you see, how, why did you decide to actually stay there? That's a good question. That's the question. Well, I guess before that,
00:09:28
Speaker
I could say that we've always, when I say we, is with my wife and a bit with the kids to some extent, but we've always wanted to be kept on our feet, to put ourselves in challenging situations,
00:09:42
Speaker
facing new unknowns over time, probably in order to avoid complacency and comfort of just having a very well organized life. And there's nothing wrong about that. It's just, you know, maybe that was not for us at that stage in time. Maybe it will become in the future, but for the time not.
00:10:05
Speaker
And the more we did that, moving from country to country and experiencing new cultures and having to set everything up from scratch again, from the admin side to social networks.
Integrating into Israeli Culture
00:10:18
Speaker
has always kept us as I said on our feet and kept us young to some extent and quite tight as a family also because when you're moving as a family the only common denominator you have is the family so you stick together and you make sure that everybody goes through the experience in the smoothest ways possible so
00:10:39
Speaker
So, it's been very, very good as a solution for our, I would say, for our family development and from a professional learning and personal growth too. So, Israel had always been a bit of a, yeah, something about, I don't know if you could call it a dream or an inspiration, but something that I was, we were very keen in experiencing, but not as tourists, which is something we have been doing quite, quite often, but really living there.
00:11:07
Speaker
And I had put my hand up, let's say, when there's a good opening there, I'd like to be considered for the position. And that indeed happened. So super happy to arrive in 2014. But it's true, we arrived with this mindset of expat. OK, look, we're coming. It's for work. We'll settle. We'll see how it goes. And we'll keep our options open.
00:11:32
Speaker
and we'll figure it out. And it's true that over time, in a couple of years, we integrated here. It's not an easy environment to integrate, it's quite a tough culture mindset, but very lovable and we really found this place to be our new home. So when it was yet time,
00:11:52
Speaker
for us, for me to move out as an expat because you know these large corporates, they don't leave expats in places for many years. So after three years, we started to have a conversation which led into the fourth year of finalizing it. And the more the company was offering new locations, the more we felt it was just not the right thing to do.
00:12:14
Speaker
And the right thing to do was to stay here, to live in Israel, to become Israelis, to develop our kids here in this country. And that led actually to an actual very smooth and in good terms separations from Philip Morris. And that's how we decided finally in 1920 to fully immigrate into Israel, get our passports and become really Israeli citizens.
00:12:44
Speaker
All right. And now your daughter, as you said, is in the army. So that's right. That's it. So yeah, I mean, now the objective is to get the, you know, the kids.
00:12:54
Speaker
fully localised, I would say, because this is their home country now. We're keeping ties to Switzerland. We have our mothers there, my wife's mother and my mother-in-law and mine. And we go quite often, of course, with friends and more distant family, because we are, maybe from a nature perspective, a bit more Swiss than Israelis. But I think it's a nice mix, because the two mindsets are quite diametrically opposed.
00:13:21
Speaker
And seeing one from the other's angle is quite fun and quite enlightening at times. And I think we can jump from one style to the other in a manner that brings us the most out of it.
Israel's Startup Ecosystem
00:13:38
Speaker
One of the things that have really contributed to making us love Israel and wanting to be here is this energy, this
00:13:46
Speaker
constant desire of people to move forward to do things, to fix problems, to find solutions, to carve out opportunities out of hardship.
00:13:58
Speaker
And that spirit, that combative spirit, that pioneer spirit, I think is still very, very present and is felt on a daily basis. And we find it extremely enticing. It's something that stimulates us. It's something that makes you want to get up in the morning and do things and circumvent obstacles and just figure out how to do things you don't know how to do. So a lot of learning, a lot of
00:14:27
Speaker
putting yourself back into questioning, into perspective and feeling quite alive, which is a great feeling to have, I must say. And what did you say have been the biggest challenges in the last 20 years?
00:14:45
Speaker
personal or professional? Okay, so professionally, well, yeah, professionally, I mean, the biggest challenge has been to advocate for this smoke-free world as part of Philip Morris. I mean, to come in as a representative of the largest, you could say, death
00:15:02
Speaker
enabler from some perspective of avoidable death by selling cigarettes and being listened to and considered by anti-tobacco activists, by political stakeholders, by community leaders has been very challenging and quite painful and quite tough at times. Yet nonetheless, in many cases, I have been very positively, let's say, surprised to see that after
00:15:31
Speaker
And not so long conversation and discussion, you know, five, 10 minutes, 15 minutes of debating the merits of the approach the company has about solving the problem of smoke by providing smokers an alternative rather than just telling them you can't, you shouldn't, you mustn't.
00:15:51
Speaker
um and and deriving a good business and profitability out of it so to make something that is compelling for for the company overall yeah you you see that people actually stop listening and start thinking and start uh you know gradually being
00:16:09
Speaker
more or less in agreement with the logic. They might still not like you or despise the company, but the logic is quite sound and you do see people being swayed into a more
00:16:22
Speaker
neutral ground from negative to neutral and some to positive. And this is how the public debate has started and has been fueled. And I must say that it was a great challenge, but it came with a lot of satisfaction. I've been giving a lot of keynote speeches at universities, at tech conferences, at whatnot, to share this idea, this philosophy and this logic.
00:16:45
Speaker
And the overall response has been quite positive and that has been very motivating as well as when there were personal situations of people who come to you and tell you, wow, this product, since I'm using it, my life has changed.
00:17:06
Speaker
my wife doesn't ostracize me and kicks me out to go smoking on the balcony. So you have a lot of positive feedback and again this famous sense of purpose or usefulness is something that you feel on a regular basis and I must say that is very motivating and very useful. So that was a big challenge but a challenge that
00:17:29
Speaker
that I learned to deal with. That's on the professional side. On the personal side, well, integrating in Israel was not easy, because again, it's quite a tough country and you need to fight your way through things and not take no for granted and just show resilience and perseverance to get things done.
00:17:52
Speaker
But I would say that one of the biggest personal changes was also to manage our parents from a remote perspective, parents who are getting older and don't have their grandkids around with them. That's a bit difficult and a bit painful. But we're managing as well as we can. Yeah. So let's talk your transitioning from corporate to venture.
Creating a VC Fund for Israeli Startups
00:18:21
Speaker
And maybe you can explain a bit more about what you're actually trying to do now, to build. And then we go into a bit more detail. Okay. So, I mean, I think this all started when I was working as I was heading Philip Morris here in Israel and it was
00:18:41
Speaker
really arriving at the time where these new products, these smokeless tobacco products were being made available, so out of our Indian lab into marketing the conditions, or more stability conditions. And it was clear for me that Israel was a great place for the group to launch.
00:19:03
Speaker
do a proxy out of because of the different characteristics of the country. We have different types of populations, you know, from after all the lot of Jews to Arab Israelis to the general population, to ex-Soviet block immigrants in a small and controlled environment. So, you know, I advocated for the country to be one of the first launch markets and that turned out to be the case. And then the second thing was that while managing
00:19:32
Speaker
manufacturing marketing cigarettes or something that the group was extremely good at having done that for decades and decades and an extremely efficient and effective manner suddenly facing new products that needed complete new set of. Support explanation.
00:19:51
Speaker
handholding of consumers, new retailer channels, new routes to market, the new strategies, new marketing and communication, the use of new digital channels and tools. All of that was fairly new and therefore I was surprised to see to what extent the group was not leveraging the innovation that was available around us, this whole tech ecosystem.
00:20:15
Speaker
And so that's the second thing I advocated for, creating a blueprint to actually tap into this ecosystem in a more organized way. And that led actually to the opening of an innovation outpost here in Tel Aviv, which I opened and inaugurated in 2017 to actually create a bridge between the Philip Morris corporate world and the startup.
00:20:40
Speaker
So that was just the beginning of the interaction with these type of companies. But when we really started to work with them, that's when I saw all the complexity and the issues that large corporates such as Philip Morris have when they have to deal with startups in terms of, of course, mindset, in terms of speed, in terms of compliance, in terms of requirements, in terms of decision making, in terms of
00:21:03
Speaker
in terms of putting together the people to work on a POC or R&D people together with the tech guys and the CTOs of the startups. And it became quite painful to some extent to see how complex all of this had become and that promoted the need to actually revisit
00:21:26
Speaker
the internal processes to make all of this thing lighter and more agile and leaner and that was a good platform to bring leanness into Philip Morris in order to interact with this. So I had a lot of interactions with these startups and I must say that it was always fascinating to talk to these entrepreneurs which have all these ideas which are so passionate about the issue they're trying to address and how they want to go about it and their personal story that is usually blended into the overall
00:21:55
Speaker
scheme and very rejuvenating and exhilarating to be in contact with these people. That's what made me want actually to go towards that direction and to be part of that thrilling, let's say, kind of environment. And that's why after Philip Morris, I
00:22:15
Speaker
I had a stint at startup, at the startup that I mentioned previously, the water-soluble biodegradable plastic. That was a great experience. I was voting as the CEO of the company, and I discovered what's working for a startup, a small startup. It was, let's say, post seed, but yeah, mid-size seed. And all the complexity
00:22:43
Speaker
that it had to do. There was a lot of stereotypes that I thought I would be witnessing at startups and eventually things weren't exactly the way I were expecting them to be. I found it to be way more complex than I thought, I guess, naively thought and actually quite
00:23:11
Speaker
quite cynical to some extent. And that's why overall I understood what it takes to be an entrepreneur and to be part of a startup and to manage it. And it turned out that it was not really my thing. So it was a great experience, but it didn't really hit my DNA in the way I thought it would.
00:23:35
Speaker
But I leveraged the experience to then move on to VC, which was going to be at the intersection between
00:23:42
Speaker
the financing on the one side, the technology on the other, and putting that together, leveraging my experience from corporate, because what I'm doing at Catalyst Investments is actually offering, selling, setting up a platform in the form of a venture capital fund for corporates that want to create a portfolio of startups in Israel, of Israeli innovation.
00:24:06
Speaker
So I create a dedicated fund like an externalized CVC, if you will, for the corporate to invest in Israel without having to go through all the pain and suffering of the deal by deal and deal flow.
00:24:25
Speaker
figuring out and making so it's kind of a turnkey solution that enables them to invest in a slightly remote manner but according to the the verticals that are of interest to them and according to the investment strategy that we define together and we run this fund like a normal fund so we're incentivized on of course the exits and the financial return but what they are in for is the innovation and the technology so we get the most of them the most of both worlds I would say
00:24:53
Speaker
So what is special about Israeli startups seeing the ecosystem? What makes it special? I mean, we hear constantly about Israel, the size of the country versus the startup seeing it's disproportionate, right? A lot bigger countries couldn't
00:25:17
Speaker
have one tenth of what is in Israel. So what makes it special? What's the magic sauce in your view? I think there are several parameters that make it special. I mean, they're not unique. There are plenty of startup ecosystems and Israel is one of them, but it has been working out quite well for various reasons. I could mention that one of the things is that there's a
00:25:44
Speaker
And Israel is, at the end of the day, it's still a pilot project as a country. It's a 75-year-old country made of a melting pot of people that have immigrated from over 80 countries. So it's still all in development. And the one thing that has been consolidating, let's say, the foundation of the society is education.
00:26:06
Speaker
And I would say, therefore, that this is the first pillar whereby the government, the state, is putting a lot of investment into education to not only normalize the education level of the country, but bring it to one of the highest in the world. And I think it's the country that invests the highest percentage of GDP into education over 9%
00:26:27
Speaker
of Israelis GDP is going to education into education into R&D, which also is an extremely high percentage of GDP around 4.5%. And, you know, so there's no surprise that out all of these great research centers, university, there are great thinkers and researchers and engineers, 12 Nobel prices in Israel.
00:26:49
Speaker
and top universities recognize globally. So the education is one pillar of the mix. The second one I would say is the government support. A lot of institutional money going into R&D, into incubators, into startups from the Israeli Innovation Authority that is really fueling and funding, not only with money but also with support and with networking capabilities, the entrepreneurs and their ventures.
00:27:18
Speaker
The defense industry that's something that is specific to Israel where the defense industry is extremely well developed a lot of the technologies that.
00:27:28
Speaker
are made available through the startup ecosystem, are actually originate from the military and defense industry out of a need for constantly finding new ways to anticipate, avoid divert threats of neighboring countries or within the country. Again, there are very impressive tracks, training and talent management tracks for soldiers which come out of the military service.
00:27:57
Speaker
and usually go to the tech sector and found their startups there. The tech sector is extremely developed. Essentially, it was born more out of a B2B kind of approach, but over the past 10 years, 12 years, it has branched out a lot in B2C, so you have now really
00:28:15
Speaker
verticals that are covering quite a wide spectrum of types of business models and you know strongholds of course in cyber security but also in digital health in automotive in smart cities in iot in climate tech sustainability food tech fintech are very big also here and i think it all has to do with the fact that israel is a country that doesn't have natural resources so that it's only resources in the middle of this
00:28:42
Speaker
desertic area has been its brain power and knowledge and talent. And that's what it has been leveraging. Of course, access to financing. Israel has a great access to financing from B.C. internationally. There's around 380 B.C.s present in Israel providing funding, plus, as I said, government support and international institutional support.
00:29:08
Speaker
And to close this, let's say, magic final touch or ingredient in the recipe of that success, I think it has to do with what we were discussing previously, which is this kind of culture. The Israeli culture, which is a mix of Jewish culture,
00:29:26
Speaker
based on a lot of questioning and interrogation about how the world works and the Bible and God and place of human beings on this planet and the philosophical aspect of all of that. So a lot of constant questioning, but also this desire to constantly improve, find solutions, break down walls, make things happen in general
00:29:52
Speaker
is something that is driving these entrepreneurs, the Israelis in general, but these entrepreneurs forward at a great pace and the resilience and the perseverance in the face of...
00:30:02
Speaker
the geopolitical situation or simply the toughness of the daily life, because it's not easy on a daily basis, despite the great weather and the food and the fun and the social and whatnot. I mean, it's still quite a tough environment. The cost of living is extremely high. Salaries are not that great. So, you know, it's tough to make a living. And that's also something that is
00:30:25
Speaker
provoking or prompting many people, you know, when they come out of university or out of the military to say, you know, what should I do? Should I take a nine to five type of job that is poorly paid or just, you know, invest two, three, four years into trying something out? And if it works, great, you know, bingo. And if not, OK, you do something else. So a lot of people are indeed going into the entrepreneur and ship
00:30:54
Speaker
a field to try it out, and they have this baggage, they have this mindset, this perseverance, this drive forward, this chutzpah, and they go for it. And out of the mass, you have now more than 90 unicorns out of Israel, which is the highest number for a single country in the world, a number of startups per capita, and investments. So I guess it's a bit of a mix of all of that, and that's what makes it extremely
00:31:23
Speaker
extremely interesting in a small geography so everyone knows everyone and therefore the networking capabilities and the capacity to attract talent and recruit people is something that happens quite fast and quite smoothly which is as we all know critical for a company to be successful. Great and so managing the corporate
00:31:49
Speaker
VC out Outside is what you're gonna be doing or you are what is the what is the? Target what do you want to build in terms of size? What are the economics of the business in general? How does it work? What is your holding period or of your clients? so just like an overview of the structure and
00:32:14
Speaker
Right. So corporates, I mean, we're talking about global corporates that, you know, that have sufficient funds to invest in Israel also on top of, of course, all the locations that they're investing into. So they're looking at creating a portfolio of, you could say, around 12 to 18, say 15 on average startups in the vertical that is of their interest or verticals eventually.
00:32:42
Speaker
So usually it's quite early stage investments because the more mature and late stage they go direct and they do their own investments into these companies. So this portfolio of let's say more early stage companies investing in 12, 15, something like that. Usually what I tell them is that they need a budget of 30 million. So we create a fund dedicated for them for 30 to 50 million dollars. So that enables them to invest highly in early stage only with
00:33:12
Speaker
50 or even 60 percent of top-ups when needed and in some cases also investing into B or C rounds if there is a company of specific interest that they want to work with. And the interest for them is that they're putting their money, I mean through us, into different ventures that in some cases they wouldn't be able to
00:33:37
Speaker
get approval for in turn going to go to their whoever senior management or the people in charge of approving these investments. It's not a given that they would accept this type of investment because I've seen how it works in corporate. A lot of the decision making is made by people who are usually employees and therefore incentivized on their annual objectives.
00:34:03
Speaker
And it's difficult to be incentivized on an investment into a startup, which is a 10 plus year eventually investment in order to really witness the fruits of that investment. So if it's not for the 10, 15 years, then it has to be for something else, which is the immediate strategic fit of the technology. So they can say, look, this company has developed something that we can use as part of our XYZ product slash service offering.
00:34:32
Speaker
On the one hand, they're reluctant to invest into a more long term, let's say, horizon three type of, even two or three type of investment. And on the other hand, they prefer investing into things that have an immediate application, which is good. But when you say immediate, that means that you don't leave yourself a lot of space for things that are a bit less.
00:34:55
Speaker
controllable, understandable and and and seasonable immediately. And that's why this creates a good platform for them to have a bit of a sandbox to play with.
00:35:07
Speaker
And then it's small tickets that are put in the companies. I mean, we lead the rounds, usually taking a board seat to help the company grow and develop. And then the corporate comes here as a strategic partner for the startup. So they start working together, which is mutually beneficial.
00:35:26
Speaker
and of course it accelerates the growth of the startup and it's good for its reputation to have a strategic partner behind it but on the other hand the strategic partner is not on their cap table directly because it's through the fund which also helps them out in order to feel more free let's say from a decision-making perspective and an industry focus and if things work out well then you know then we put more and
00:35:48
Speaker
the future rounds and at some point the idea is that the corporate ends up acquiring and that would make sense, that would be the perfect scenario. Acquiring one, two, three years, several companies of the portfolio and so that create exits. So the timeline of the fun if you will normally is
00:36:06
Speaker
It's eight years plus one plus one, so 10 years in total. But in some cases, some companies prefer going into a more evergreen kind of structure, which enables the funders to continue and to live through, ideally, the life of the startup until there's an exit or there's a clear use case of that technology and rotate the funds throughout a longer investment period.
VC Fund Structure and Corporate Strategy
00:36:34
Speaker
That's a bit how it works. Yeah. And you're looking at how many of these? Look, if we can have ideally three, four would be a good start. Up to 100 million. Yeah, that creates a size that is good enough to manage. And of course, it has to be based on an exclusivity type of frame.
00:36:57
Speaker
because you don't want to have corporates that are competitors having their own fund. We couldn't manage, of course, competing funds in competing verticals or competing industries. So, of course, there's a price to pay for the exclusivity on both sides of the table.
00:37:14
Speaker
super well good luck with that fingers crossed much better to be honest than the smoking bit okay I'm a former smoker you still smoke I remember you
00:37:29
Speaker
All right, so speaking of INSEAD friends and all that, the INSEAD connection for you, how has it worked out all these years? And obviously with regards to my other interests being raising funds for our endowment, I do have to say that you have always been a big supporter of me.
00:37:50
Speaker
So very regular and thank you for that. Eight out of 20 years you've been chipping in and you are a green pin holder, so thank you for that. But tell me what are the INSEAD connections and then how you think about INSEAD, how you think about giving and giving back to INSEAD in particular.
Impact of Insead and Giving Back
00:38:10
Speaker
Well, INSEAD is so intimately linked to
00:38:16
Speaker
most of the things that have happened to me that it's only but natural to, it's not only about giving back, but to be connected and to participate and to be active about it. You know, if I think about this coming here to Israel, which was this type of dream and now has become our new reality is thanks to Philip Morris and Philip Morris is thanks to insert. So, you know, there's a lot of what we're living today that is really
00:38:45
Speaker
due to the possibilities and the opportunities that the school has given me. So I don't see Encierna as just a place where we learn things or we develop a great network and friendships. It's really a foundation step in what has happened to
00:39:03
Speaker
to me and my family over the past 20 years. What can I say? I've been very connected in general with the community in the different countries where I was living. And here in Israel, there's a great group of alumni coming up with initiatives on a regular basis. And I'm happy to be part of these initiatives.
00:39:23
Speaker
There's a new initiative now that I'm going to be part of the working group for promoting a woman in leadership position inside the alumni women in leadership position here in Israel. So that's going to be a very interesting new endeavor. And there's been a lot of events organized also by Ziv Carmen. Remember Ziv, who was our mom? Oh, yeah.
00:39:47
Speaker
As an Israeli, he's very active on promoting Israel vis-a-vis INSEAD, has been bringing here numerous delegations of GMBAs or students, and we have participating, maybe hosting one of their events soon. And every time Elian was here, there were events and
00:40:09
Speaker
one-on-ones and discussions of how could we help INSEAD more from the Israeli perspective, how could INSEAD leverage Israel more, very interesting discussions that led to several initiatives. So I think that's very important just to be part of what's going on and helping anyway. And giving is the easiest thing possible, I guess.
00:40:32
Speaker
The most important thing is to try to give on a regular basis. So I've tried maybe not every year, but in general. And of course, the larger the donations, the better. But it's probably more important to give on a regular basis than to do a one time big one. I don't know what you think about it.
00:40:54
Speaker
I think over time it proves a more solid and meaningful connection and follow up with the school. So that's how we see it. We still have lots of room to grow. If everyone gave a hundred bucks a year for the 20 years we've been there, we would have a lot more actually than we do have.
00:41:19
Speaker
Yeah, it's surprising that not everybody gives because it's true that I don't know. Maybe one of my theories is that giving a small amount is something that people don't feel comfortable with. First of all, because they know they could give a bigger one or a higher one. And so maybe they're like refraining. I don't know. But you're right. 100, 200, 300 is not a lot per year. Yeah.
00:41:44
Speaker
but makes a difference. So I cannot encourage people to put even small tickets, but on a regular basis every year doing an automatic pledge. I think that that's great. Well, thank you for doing the job. Well, I'm trying to help out, you know.
00:41:58
Speaker
A hundred bucks a year all throughout. But a thousand, ten thousand and fifty is even better a year too. Of course, yes please, yes. Well thank you, thank you for your generosity and for your discipline, which I guess comes from your Swiss side, right? On time, regular, things work like the Swiss clock. But I must say that the fact that you reminded me every couple of years is also useful.
00:42:28
Speaker
Yeah, there you go. Therefore, we have a podcast now. So I keep on finding inventive, creative ways to keep people's attention. So thank you for listening, everyone. Thank you. I hope you're enjoying it and do give back if you can, when you can. Now, we move to the last part. Quick round of questions. If you're ready, I start.
Proudest Achievement: Settling in Israel
00:42:52
Speaker
Proudest achievement. Proudest achievement. Moving, settling in and living in Israel.
00:42:57
Speaker
Success for you is? Success is putting yourself in mindset and in a situation that enables you to seize opportunities as they come. Happiness is? Happiness is seeing the comical angle in any situation. Biggest regret?
00:43:21
Speaker
the biggest regret. I missed communication opportunities with my father before he passed away. Second person who says that. Really? Yeah. I think different generations, different communication styles. Life is short. Life is short. You should not forget this. What keeps you awake at night? I guess it's
00:43:44
Speaker
figuring out how to help my kids confront this everly more complex world they're going to be living in and having to to thrive in because I must say that it looks quite tough out there compared to when you know we probably graduated from high school or even university or even INSEAD but maybe it's just you know
00:44:09
Speaker
just the way things evolve, it just always looks more difficult than what we know has happened. But yeah, some of the aspects of our current society in general are a bit worrisome, but there's also a lot of positive expectations around that, so it's a balance. Wish you had known or someone had told you? Something that I was told
00:44:34
Speaker
A while ago, but I wish I had been told that more firmly earlier is simply, if you can choose between being kind or being right, choose kind. I like that. If you had to do it all over again, what would you change? I think I would have studied something different at university because I studied business economics, which at the end of the day, you all learned at INSEAD.
Approach to Retirement
00:45:01
Speaker
might as well do something different and then top it up with an MBA. Yeah, that's smart. All these engineers we had, right? Yeah, engineering, or even why not something completely, I don't know, something different. Retirement, ever or never? I guess retirement as a specific moment in time where suddenly you say, and now I'm retiring and therefore I'm stopping this, that this, certainly never. But
00:45:30
Speaker
And a gradual phasing out of things, a change of rhythm and intensity over time, I think, makes sense. And shift of priorities towards things of higher interests, or who knows, maybe in time more noble, even better, why not? If you had to pick one book, everyone should read. Glucose Revolution. Okay, that's a new one.
00:45:57
Speaker
I mean look i think nowadays maybe because we're aging but it's all about quality of life and longevity and understanding how.
00:46:09
Speaker
glycemic peaks impact inflammation, which causes most of the issues in our body over time is fundamental to try to lead a better, more healthier life going forward. And what I like about the book is that it comes down, it really boils down quite a chunk of science into something fairly digestible with solutions that are very pragmatic,
00:46:34
Speaker
easy to implement without having to sacrifice any of your real dietary constraints. And so that resonated a lot with me. And yeah, I really recommend it. Most admired public person. Let's go with Jerry Seinfeld. The most despised public person. The film, the philanthropy, the witness. The most despised one, Kanye West.
00:47:02
Speaker
Last one, are you coming to reunion? Of course! Of course! Do bring some champagne, all right?
00:47:12
Speaker
That's great. So it's October 6th, 2023 in Fontainebleau this time and the Gala at the Chateau on October 7th. And this was, I can finally say officially, a conversation with Daniel Elphin, Lola Pan, a senior partner at Catalyst Investments in Tel Aviv, Israel these days. Thank you so much for your time, Daniel, and for your generosity and for helping
00:47:39
Speaker
My job gets easier, hopefully. And I'll see you in 20. Thank you so much, Mila, for this great chat and for everything you're doing and looking forward to seeing everyone in a take care. Thank you. You were listening to the Republic of Incia 20 years later, all 3D podcast edition.
00:47:58
Speaker
It is my hope to remind everyone what an interesting and, dare I say, colorful bunch of people we are and how much we can contribute to each other, be it through ideas, knowledge, or mere inspiration. The podcast is inspired by the original Republic of India yearbook, produced on paper 20 years ago by Oliver Bradley and team. Thank you, Ollie and team, for this contribution to our class's memory and for letting me continue in the tradition, title and inspiration included.
00:48:27
Speaker
Creator and author of the Republic of Incia 20 Years Later O3D Podcast Edition, M.I. Milena Ivanova. Original music by Peter Dondakov would help from their film's productions. Stay tuned for more and remember to book your tickets for the 20-year reunion in Fontainebleau October 6th, 8th, 2023. Thank you for listening.