Tzahi Wiesfeld is a seasoned, serial entrepreneur who has 25+ years building companies across the US and Israel. As General Manager of Global Startups at Microsoft, he built the Microsoft accelerator programme, expanding it globally to Bangalore, Beijing, Shanghai, Berlin, London, Paris and Seattle. He currently serves as a Vice President at Intel and General Manager of Intel Ignite – an early-stage startup program in Tel Aviv, Munich and other locations around the globe.
We recently caught up with Tzahi who shared his thoughts on successfully scaling into global markets, some of the differences between the ecosystems within Australia and Israel, as well as the emerging technology trends arising post Covid-19.
Lesson 1: Figure out your expansion strategy
Israeli companies tend to think globally from day one, while many Australian companies start locally, building business domestically before they look at growing internationally.
At Think & Grow, we’ve worked with a number of clients over the years on their international growth, helping them choose the right geography and often city to open up in and working closely with them to decide when the company is at the right stage to expand internationally.
There is a significant difference in approach between Israeli start-ups and others in terms of global aspirations as Tzahi said: “In Israel you have to show that you’re global first – that there is a big opportunity in the US and you have a list of potential customers. This is what the investors invest in.”
In comparison, Tzahi’s view on Australia is that “you have to first show you’re bringing revenues – bootstrap and then get funding.” The mindset is ‘take care of the local business and sell locally. Global is secondary – it will come later’.
Lesson 2: Immerse yourself in the culture and support available to you
Every location has a different culture, whether it be Beijing, Tel Aviv or San Francisco. Startups expanding into new countries and cultures need to keep a good part of what they do the same, but adapt specific things that are relevant and critical for the local culture.
Generally, Tzahi says that one thing he’s learned about scaling globally is that startup ecosystems are small (tens of people, not thousands). In each ecosystem, there is a lot of local patriotism – people want to see their own ecosystem succeed and therefore a common characteristic is local people willing to invest their time and effort to create a local success.
In his previous position at Microsoft, he ran Microsoft for Startups in over 110 countries, where the company itself invested over $500 million dollars per year on ‘ecosystem development’.
- On partnership and support
The key to a successful partnership is that everyone gets value out of the relationship. Ask yourself what you would want to get out of the engagement and see that you deliver to that value.
“The startup world is built on networking and connecting with others. So you should open up your network and find opportunities to expand for a potential partner. It’s never about just ‘what I can get’ - we should be looking to constantly introduce people because people want to meet other people. Having warm connections to introduce you to – potential partners and global experts – is critical.”
- On the 'pay it forward mentality'
The Israeli ecosystem has a significant ‘pay it forward’ mentality. Successful people tend to step up to share their experiences and time with founders and startups.
From an Australian perspective, we are seeing the same pay-it forward mentality with successful founders taking the time to mentor and even invest in the next generation of startups.
Tzahi, noted that ‘pay it forward’ is part of the startup culture especially in Israel where it has helped contribute to the successes of Israeli tech companies. ‘It takes a village to raise a child,’ Tzahi says. ‘It’s about building these villages with a lot of people that are willing. I can tell you, there's so much excitement in Germany and Munich specifically about what we do. And there's so much willingness of the ecosystem, the investors, repeat entrepreneurs to help and build great local success stories, that generally it's something people want to do.”
Lesson 3: Fundraise bigger and earlier
Tzahi is firmly of the view that at the moment, it’s important to raise as much money as possible, as early as you can right now. “When you're able to raise funding earlier, you can hire strong talent faster, earlier. It's a super tough market we're in right now from a talent perspective, multinationals are paying a significant amount of money and great equity for talent. For startups, it's not easy to compete for multinationals, it's not easy to compete at all.”
As Australian borders continue to remain closed, a similar situation to Tzahi’s reflection on Israel is emerging with strong talent becoming harder to find.
Key insights on Australia’s startup ecosystem
At Think & Grow, we see the Australian tech scene on the cusp of an inflection point with successful tech companies such as Canva and Atlassian to look up to; founders with experience investing and substantial amounts of funds raised by the local venture capital funds ready to deploy in the next generation of start-ups.
On Tzahi’s last visit to Australia, he found “great entrepreneurs, and some of them were not local, they came to Australia from other places”. He “saw the eagerness to build a thriving successful ecosystem, a lot of people that are willing to go a long way to help others be successful.” He found “policymakers trying to do the right thing, trying to bring programmes globally”. “It felt like Israel 15 years ago from many aspects”.
Tech trends in Israel post-Covid
Tzahi says, Israel is going through a big change and there is significant growth happening in scaleup companies. “Their investments and valuation is significantly higher and for them it's a different game than before”
There are also many tech trends being seen by him as a result of the COVID-19 pandemic:
- Education (edtech) – Classrooms were willing to change because they had no choice.
- Ehealth – Due to COVID-19, people couldn't come to a doctor’s office in person and had to do things remotely.
- Egov – the number of remote government services increased dramatically.
In addition, funding changed significantly:
- It took half the time to raise much more money during COVID than before it
- 41% of funding rounds closed without any face-to-face meetings
- 76% of funding rounds closed with only 1-10 Zoom calls.
There is the question of whether these trends will revert back. Tzahi isn’t sure they will.
“Our time before COVID-19 was insane. We travelled way too much and it was a very easy decision to bring yourself to the airport and fly across the world to meet with someone because there was no other chance of closing the deal. Well, apparently, there are other ways and you can actually meet more people over Zoom.”
He admits we don’t know yet what the future workplace will look like, and what will stay and go, but he is sure we will see some considerable change.
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