Author: David Stark

Not just another acquisition headline

If you are like me — an innovation and entrepreneurship enthusiast — then you get excited when you read headlines about the latest acquisition of a startup by a large multinational corporation. You get excited on behalf of the startup’s founders and team that they have reached the culmination of what must have been an incredible journey. You get excited about the possibility that the integration will go well, and that with the large company’s resources behind it, the startup’s technology can soar to new heights. If the company being acquired is local, you get excited about what this means for your tech ecosystem: more talented, experienced employees and management now available to help the next wave of local startups scale, and potentially more capital flowing in now that investors are paying a little bit closer attention. Most people, however, read the headline, process it, and move on. This is understandable given what little impact the merger or acquisition will have on their lives or on the lives of anyone they know. While they may be happy for the presumed financial success of the startup’s...

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The First “Law” of Venture Capital

In technology, change tends to be revolutionary not evolutionary. So you need to force yourself to place big bets on the future. -Larry Page Power Law Curve There is a tendency among less experienced early stage investors to think that the distribution of venture returns is linear — portfolio companies have an equal opportunity of failing, plateauing or growing. In reality, however, venture returns are incredibly skewed within a fund’s portfolio (as well as across venture funds). As Peter Thiel and others have discussed at length, the actual distribution follows a power law, with a few winners accounting for more returns than all others combined. Understanding the power law curve is essential to being a good venture investor, a difficult task given that most of us are accustomed to thinking linearly in our daily lives. Thiel attributes this curve to the compounding power of exponential growth that is typical of successful venture investments: Successful businesses tend to have an exponential arc to them. Maybe they grow at 50% a year and it compounds for a number of years. It...

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Impact Investing 101: How to generate social and environmental impact alongside financial return

What is impact investing, anyway? It is becoming increasingly apparent that private enterprise can play an important role in solving critical social and environmental challenges. Investors realize that these companies can have a meaningful impact on the world while delivering financial returns at the same time, enabling investors to “do good while doing well.” This has given rise to a large, growing movement known as impact investing. Impact investments are investments made into companies, organizations, and funds with the intention to generate measurable social and environmental impact alongside a financial return. Impact investments provide capital to support companies aiming to solve some of the world’s greatest challenges. Typical sector targets for impact investment are: sustainable agriculture and development, affordable housing, affordable and accessible healthcare, education, microfinance and financial inclusion, and clean technology. My interest in impact investing stems from a variety of personal and professional experiences over the past couple of years. The initial spark was lit when I heard Sir Ronald Cohen speak about the subject around two years ago at an event in Israel (he believes social impact investing will be the...

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“Tear down this wall!” How crowdfunding is changing the world

One of the greatest benefits of the internet age has been the breaking down of barriers. Internet based real-time communication has broken down barriers of distance, social networks have eliminated the constraints of first degree relationships, online marketplaces have removed the layers of middlemen between vendors and consumers, cloud computing has lowered the cost hurdle of developing and deploying software, the blockchain promises to circumvent centralized intermediaries and the inherent global reach of the internet (2.8+ billion users) has made barriers to content distribution a thing of the past. Crowdfunding is one of the latest internet trends that follows in this spirit. Capital has historically been one of the most difficult things to access for large percentages of the population. Most individuals are repeatedly unsuccessful in their attempts to secure a loan to cover personal expenses, raise money to expand a small business, or bring in external funding to help get an innovative idea off the ground, running into walls at every turn. These walls come in many forms (geographic or demographic disadvantage, lack of influential relationships, cost, etc.),...

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10 Israeli startups that electrified investors at CES 2015

Silicon Wadi has relocated to Las Vegas this week, as numerous Israeli startups are giving CES 2015 attendees a taste of what the Startup Nation is all about. Here are 10 Israeli startups that caught my attention at CES 2015: VocalZoom Ever wonder what it would be like to have voice recognition that actually works in real world, noisy environments? VocalZoom* combines an optical sensor (which measures the micro-vibrations on your face with an eye-safe laser) with an acoustic microphone to drastically improve the accuracy of voice recognition, unaffected by external noise. Status: VocalZoom announced at CES that its short-range optical sensor + microphone (called the SEEON) will be available in the final form factor for its OEM partners beginning in Q3 2015. CES Quote: “Customers are starting to understand the depth of the innovation and the disruptive performance that VocalZoom’s technology can offer. For IoT, home automation, autonomous cars, etc. the interface of choice will be voice, and nothing today can operate at the expected level.” Umoove While VocalZoom is all in on voice as the next big...

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