Category: Blog

Fundraising for Startups

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Fundraising for startups can be a daunting prospect and often the success or failure of your pitch comes down to your own personal performance and credibility as an entrepreneur.

If you’ve identified investors there are four key areas you need to know inside out in order to impress and really showcase your talent and ability; in short they are absolutely key to entrepreneurial performance.  Let’s examine them.

Impetus

You have to be able to demonstrate that your venture has impetus. This could be in the form of pipelined sales, user numbers, existing business partners etc.  Investors want to see traction; not the finished article, but enough potential to invest.

The Team

Your management team is key to securing any investment.  Any investor is going to need to be personally impressed by you as an individual or your management team.  If you have a team member whose talents lie in different areas to presentation or outward credibility, leave them at home!  Harsh but true; think what’s best for your business.

Know your Market

You need to know your market inside out; where you fit currently, where the growth potential is, how you intend to get there, etc.  Knowing the national spend in your field is not knowing your market; investors want to see that you are well-researched and fully immersed in your market.  Metrics are important; use them and get them right.

Money

The vast majority of investors will want you to be able to demonstrate that you can put a large enough amount of money to work and will want a significant percentage of the business to justify their scrutiny.  You need to be prepared for the fact that you are likely to be giving away somewhere in the region of 20 – 25% of your company as a minimum; 15% is a rarity and anyone looking to invest at 8% may not be serious or will be looking for a bigger cut further down the line.

Help is at Hand

At Brooks-Keret we have been developing and cultivating entrepreneurs for over five years.  Our aim is to support aspiring entrepreneurs in gaining better exposure to investors and garner helpful feedback on their ventures and their approach to gaining investment.

Our specialist panels come together once every month where startup companies from all sectors can come to pitch their ideas and tap into our wealth of experience.  We are interested to hear about what your startup’s goals are and you get the opportunity to convey these via a one hour presentation.  Our expert panel will they have questions for you; questions that every entrepreneur looking for investment should know!  The best thing is if you don’t know the answer, think of our panel as a dry run; you’ll be better prepared to wow potential investors next time.

 

_____________________________

The writer is Gil Keret , CEO at Brooks- Keret Financial Management , www.brooks-keret.co.il .

Brooks-Keret is celebrating 20 years in business

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20 years passed from our very first customer in 1995 who believed in our ability to create value through our financial services, to become the growing financial management services company we are today, with approximately 300 clients and thousand along the journey.

This year marks a major milestone for Brooks Keret as we celebrate our 20th anniversary. What began in 1995 as an idea sketched on a placemat has grown into a leading company of 100 employees who are committed to building a model company focused on your success.

We owe this achievement to the dedication of our employees, the strength of our partnerships, and the success of our customers.

We thank all of our customers and partners for helping make our vision a reality.

Brooks-Keret celebrating 20th anniversary- you are invited to watch this video.

How to Pitch to Angel Investors

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For entrepreneurs that are making a presentation to an angel investors, you will need to avoid the common mistakes that can cost you their support.
A presentation for angel investor does not need to be a pure sales pitch nor a droning rundown of data and obscure information. You will need to find the right tone in order to create a bond with them.

Here are a few tips that will help you sharpen your pitch so that you can land the services of an angel investor.

Connect with a Personal Story

Stories are by their nature simple, powerful ways to connect emotionally with this type of investor. How you started out your journey and the sacrifices made will help paint a positive picture of why you need their assistance. You don’t have to be overly dramatic, just tell your story in positive way so that you can make the connection.

Present your Story Visually

They say a picture is worth a thousand words and using images can reinforce your presentation for angle investor. When you consider that we think in images, presenting just a few photos will help engrain your story into the investor’s mind. It is a known fact that images are far more likely to be retained than just words, so find a few appropriate photos to really make your story sell.

Use Charts, Graphs and Tables for the Details

You will naturally need to present the little details, percentages and other minutia that is part of your pitch. So, use interesting graphs, tables and charts that the investor can see instead of having to hear it all from you. Of course, you can point out the different percentages and other detailed information, but presenting the information visually can really get to the point of your presentation.

Be Passionate

Your presentation will have to include your passion to help you succeed. In order for anyone to fully succeed with their business, they need the drive to accomplish their goals. An angel investor will want to see that in you. You do not have to be demonstrable in your presentation about how passionate you are, but you will need to show something beyond just saying how you feel.

Show How Your Efforts Address a Need

This is how you should wrap up your presentation by demonstrating the need for what you are trying to accomplish. All businesses, projects and endeavors have a goal which not only propels the owner and investor to success, but also how it helps others in what they are doing. This will broaden the emotional impact of your presentation for angel investor and humanize your endeavor.

Overall, if you hit the right notes then you will maximize your chances of impressing the angel investor to the point of having them push your project forward. Remember to keep it to the important points and be as succinct as possible without skimping on the important details. If you can do that, then you just may have an angel investor at your side.

Online Product or Mobile App – Which One is Better?

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2014 marked a change in internet usage trends. Cellular phones replaced the PC as a gateway to the internet. This change in usage trends affects the way we use and design online products from the ground up.

To adapt products to several screen sizes we can create a responsive platform, develop a mobile application or provide both. How will we know which is best? The answer, as always, depends on what you are developing.

The difference between a responsive or mobile adapted product and a mobile application is simple. If a product required access to the mobile’s inherent capabilities (camera, GPS etc.) than a mobile applications needs to be considered. If the product’s design and functionality is straight forward, for example a content based product (Newspapers, Blogs etc.) or even regular commercial sites with simple management requirements; you should create a responsive product.

Contrary to responsive products, when taking the application route the following needs to be taken into account:

  1. An application is a piece of software. To use it, a user must download it to his/ her device. As such, it is not exposed to indexes of traditional online search engines.
  2. An application needs to be adapted to each device type and/or operating system.
  3. An application might encounter performance issues as its performance is device related. If the owner of the mobile phone uses many applications it might affect the reaction of your application.
  4. An application’s design is completely different than a responsive design. Since most users open a profile when logging into an app, the application can provide a user biased experience. Moreover, with Push notifications, you have a direct access to the user. For example, when we receive a message on Facebook, the device alerts us of the message by raising a small circle with the sender’s image. In addition, the app can save usage habits such as credit card information, preferences, etc., which helps users get to their destination faster, and so on.

To understand what is the correct option for you, you need to take into considerations all of the above points. They will help you choose wisely.

___________________________________________

The writer is Ayelet Geva,  , Expert Product Manager, www.pmod.co.il.

Mail: ayelet@pmod.co.il

 

A Closer Look at Entrepreneur: Lior Tal – CEO RepnUp

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What gave you the idea to create RepnUp?

Today, many meaningful events in person’s life such as getting into college, getting a job, keeping a job and finding a life partner, are dependent on what they “look” like on social media. The idea to build Rep’nUp came from reading articles about college admission officers that review applicants’ social media profiles before extending admissions offers. The articles explained what types of content will lead students to get eliminated from the applicant pool. We thought that we can develop a service that will help applicants by detecting this types of content and allow them to deal with that before applying. When we solicit feedback from friends, they indicated that there are two bigger addressable markets for such service, such as users who are looking for jobs and people who engage in online dating.

What advice would you give someone who wants to make a social networking website?

Try to work from day one with multiple social media networks and not only one.

What do you spend all of your hard earned cash on?

We spend most of our budget on two fronts – R&D and M&S.

Do you think that entrepreneurialism is something that is in your blood? Or is it something that can be learned?

Most of my professional life I spent in startups. I co-founded two that were acquired by IBM and McAfee so I think it is in my blood.

Is there anyone that you look up to and model yourself on?

I look up to people like Brian Chesky, co-founder and CEO of AirBNB.com a company that created a market that was not there before and build a fast growing business around it.

What is the best advice you have ever been given?

Execution trump everything else. Eventually you’ll get a product that works more or less as you thought it would but it is all about getting to the market and succeeding in getting sales/users/partners.

What advice would you give to a Young Entrepreneur setting up their first business?

First, get a strong team around you. Investors invest mostly in teams and they are looking for an experienced and capable members.

What are your plans for the future?

We are growing at a fast rate and we need to make sure we continue to grow.

 

Find out more about RepnUp.

מבט מקרוב: טל ברנח, יזם מנוסה ומשקיע

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טל ברנח , שהיה יזם של כמה חברות במשך 17 שנה, וב–2011 החליט לעבור צד ולהתחיל להשקיע. בין היתר, הוא היה היזם של BeInSync , ואורקה אינטראקטיב .

בסך הכל הוא השקיע כאנג’ל ב–13 סטארט־אפים. 

בראיון שנערך עמו באחד מבתי הקפה בשדרות רוטשילד בתל אביב, כשסביבו שוכנות החברות שבהן השקיע, הוא מספר כי 
”ב–2011 החלטתי להתחיל ולהשקיע בחברות צעירות מאוד. השקעתי בתחומי עניין שתמיד עסקתי בהם – אינטרנט, אפליקציות ושירותים מבוססי ענן. ההשקעות היו רק בחברות שאני מתכוון להיות מעורב בהן, כדי לעזור ליזמים לבנות חברות. מתוך פאנל של מאות בקשות, פגשתי כל שנה כ–200 חברות והשקעתי ביותר מעשר. ההשקעות האופייניות של ברנח הן בשיתוף עם עוד אנשים פרטיים, והיו בסך הכל בגודל של כמה מאות אלפי דולרים ועד מיליון דולר לאחת. בציר ההשקעות שלו צעיר יחסית, אך הוא כבר הגיע לאקזיטים בחברת קרוס ריידר ובקומראנט . כמו כן, הוא היה שותף להשקעה בפיקסיה , שצמחה מאז משמעותית. חברות נוספות בפורטפוליו שלו הן קווילט , שעוסקת בניטור תעבורה של וידיאו; בימר, שפיתחה טכנולוגיה לדחיסת וידיאו והצגת איכות המקור; ו–Askem , אפליקציה המאפשרת למשתמשים להתייעץ עם הקהל הרחב לגבי תמונה ולקבל פידבק מיידי. סיד פלוס” – חברות אחרי סבב גיוס סיד אך לפני השקעה מוסדית. יותר ממחצית מהחברות שבהן השקיע כאנג’ל נמצאות בשלב רלוונטי להשקעת הקרן. בינתיים עדיין לא נבחר שם לקרן, אך ההשקעות שלה יתמקדו בחברות שכבר גייסו סבב סיד, ומראות תנועה ראשונית של צמיחה במספר המשתמשים בתחומים שבהם התמקד ברנח עד היום. ההשקעות יהיו בהיקף של 1–2 מיליון דולר, וייעשו גם באופן עצמאי וגם בשיתוף עם קרנות נוספות. הוא קורא ליזמים שאליהם מיועדת הקרן: “אם אתה רואה שהמודל עובד ויש מספיק בשר, או כשכבר זיהית את הטרנד, לך ותגייס את הסכומים הגדולים. עד אז תעבוד אתי – אתה לא צריך לרוץ לסבב ראשון”.

ההחלטה להקים את הקרן התקבלה לפני כשנה, ומאז ברנח עסק בגיוס השותפים והמשקיעים. הסגירה הראשונה שלה באוקטובר היתה על סך 20 מיליון דולר, וכעת היא השלימה את הגיוס והעלתה את גודלה ל–40 מיליון דולר. מאז הסגירה הראשונה הקרן השקיעה בשלוש חברות. “החלטתי שאני רוצה ליצור קרן השקעות שהפוקוס שלה יהיה תל אביב־ניו יורק, שזה אומר למצוא שותף אמריקאי שמוכן להפשיל שרוולים ולנסוע עם היזמים ולעזור להם. השוק נמצא בארה”ב וצריך ללוות את היזם. זה אומר גם להקים משרד בתל אביב ומשרד בניו יורק, ולתת לכל סטארט־אפ שירות מלא במטרה לאפשר לו לבנות עסק”, מסביר ברנח.

כך נוצרה השותפות עם המשרד המשפחתי (בית השקעות קטן שמנהל כספים של משפחות – במקרה הזה יהודיות) GFMI מניו יורק. בנוסף להון של ברנח והמשרד המשפחתי, צורפו משקיעים אמריקאים נוספים – חלקם בעלי קשרים רלוונטיים לתחומי העיסוק של החברות, בהם מנכ”ל פלייבוי סקוט פלנדרס, וריצ’ארד רוזנבלאט, יזם סדרתי וממייסדי מדיה מיינד. הקרן שמרה מקום למשקיעים פרטיים נוספים או מוסדיים מישראל או מארה”ב שיצטרפו להשקעות.

למה ניו יורק ולא עמק הסיליקון?

“עמק הסיליקון עמוס יותר. בניו יורק יש כיום את Silicon Alley (סמטת הסיליקון – כינוי לאיזור במנהטן שבו יש ריכוז סטארט־אפים בתחומי הניו־מדיה והאינטרנט, ע”א). זו סביבה יוצאת מן הכלל לסטארט־אפים ישראליים – כ–200 חברות ישראליות, חלקן מצליחות מאוד כמו אאוטבריין וטאבולה “.

איך שיכנעתם את המשקיעים להצטרף לקרן

“2014 עומדת להיות שנת שיא בהיי־טק הישראלי – יותר ממה שהיה השנה. לדעתי לראשונה תהיה פה יותר מחברה אחת מהבציר הצעיר של חברות אינטרנט ודומיו שיגיעו לשווי של מיליארד דולר.

זו בשורה יוצאת מן הכלל גם לתעשייה וגם למדינה. בסוף היום אנו מייצרים מקומות תעסוקה, האקזיטים מביאים הרבה מאוד מסים למדינה ואלה חדשות טובות”.

Transfer Pricing (TP)

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One of the most common methods of reducing the overall tax burden of multinational entities (MNEs) is by entering into international transactions between the companies comprising the group. Through such transactions, the MNE shifts the group’s profits from countries with high tax rates to jurisdictions where tax rates are lower. Google, for once, is diverting most of its profits to Ireland. To overcome the problem of profit shifting, many countries enacted a series of laws and regulations that require maintaining transfer pricing documentation and applying market conditions on such transactions.

What is Transfer Pricing?

Transfer Pricing (TP) is the term used to describe all aspects of transactions between related parties (a definition which differs from one jurisdiction to another). Most commonly, those inter-company transactions include:

  • the sale (transfer) of tangible property – for example for distribution purposes;
  • the utilization/transfer of intangible assets – such as for manufacturing or assembling purposes (but clients lists, for instance, are also an intangible asset for this purpose, as well as IP used for further R&D purposes by a different entity in the group);
  • the provision of services (management, marketing, R&D, tech. support, assembly/manufacturing etc.);
  • financial transactions (loans, capital notes, ESOP, guarantees, credits, etc.).

 

All inter-company transactions must be regulated in accordance with local TP rules, which mostly require: (1) a TP study, which demonstrates the arm’s length results (market price) of the tested inter-company transaction (and upon which, each relevant entity must pay its taxes); (2) an inter-company agreement based upon the outcome of the study; (3) actual implementation of the results of the study; and (4) if applicable – a TP policy (required mostly for groups of no less than 3-4 subsidiaries).

 

What is the “Right” TP Model a Company Should Implement?

The answer is complex and depends on the circumstances of each company and the different characteristics of each transaction. For each type of transaction, the local TP regulations determine a different TP method. It should be specifically noted, that the too common use of the “cost plus” model is more often than not incorrect, either in terms of the applicable TP method (which should have been different due to the characteristics of the transaction) or in terms of the “cost” and “plus” determined by the parties. For example, should options granted by the Company to employees of its subsidiaries be calculated as part of the “cost”? The answer depends on the TP model adopted and on the relationship between the parties.

Another example would be in intercompany financing matters, where not only the “arm’s length” interest rate and the loan terms need to be taken under consideration, but also the company’s capital structure. Each company has a different supply chain, IP ownership structure, functions and risks allocation among its group companies, etc. and thus the “right model” has to be carefully considered in order to abide by applicable rules.

What Are the Critical Issues When Implementing the TP Model?

The bottom line is that in order to really implement the TP model, the daily business routine between the relevant companies has to reflect every aspect of it. The financial statements have to be separated in a way that enables to trace each intercompany transaction. All inter-company transactions have to be backed-up with proper agreements and documentation, which will demonstrate to the tax authorities that the inter-company pricing is similar to (or in the range of) non-related third party transactions; or explain why it’s not.

Our experience shows that many MNEs see themselves as an unseparated unit, which can create difficulties in implementation and significant exposures.

 

What are the consequences for not implementing TP?

The main exposures are to double taxation, fines, interest, linkage, and adjustments to the group’s financials (roll back period). It should be noted that TP legislation overcomes any treaties and even allows tax authorities to re-open previously closed tax assessments. Aggressive audits and heavy fines are some of the measures tax authorities worldwide are using nowadays, and it seems they have no intention of stopping there. Additionally, wrong TP models (or the lack thereof) also bear implications on VAT and customs exposures.

Additionally, in certain countries the company’s CFO has to sign a unique form (or tick the box), stating the company is acting in accordance with the TP regulations (i.e. holding a study and acting thereby). In Israel, the obligatory form 1385 requires the description and detailed pricing of each inter-company transaction performed with related parties.

—

Bar Zvi & Ben Dov is a boutique law firm specializing inter alia in transfer pricing. The firm has been active since 2006, and has filed over 500 studies worldwide, with 100% success rate in tax audits worldwide. The firm is recommended by the Legal 500 international guide in the fields of Tax and High-Tech, has offices in Tel-Aviv and NYC, and is a partner of Transfer Pricing Associates, the world’s largest independent group of international experts in transfer pricing, providing local sign-offs in more than 60 counties.

Improve Your Marketing Efforts in 2014

BKadmin

 

Here are 7 Tips that can Help You Improve Your Marketing Efforts in 2014:

 

1. Time to Get Social

Be sure to be active on Facebook, Twitter, Instagram and Linkedin. Engage in conversation with your customers, Share their posts, like their pages and be sociable!

2. Increase Your Testimonials.

Your clients will want to read them in order to feel comfortable with their decision and know that you are the best provider.

It’s time to ask your current and past customers to write a review and say if they’ve been happy with your product or service.

3. Incorporate a Mobile Marketing Strategy

Your customers are on mobile phones. What does this mean to you?

It means more consumers are using a mobile device than ever before.

How does your site look on a mobile phone/ mobile device? Is it mobile friendly and easy for a mobile user to navigate?

Are you using  mobile coupons, QR codes, and SMS text messaging? There’s a mobile world happening, and if your business isn’t reaching the mobile consumer, you could be losing a chunk of business.

Did you know that over 84% of people use a mobile device at home? It’s not just when they’re on the go.

4. Your Marketing Materials

Today’s consumers want transparency, they want to know you, your business; business is more personal than it was before. Do you let your business’s personality shine? Does it show in your website and your marketing materials?

5.  Email Marketing

Communication with your customers and prospective customers is important!

You can send a monthly newsletter or an article that your customer would benefit from, or send a special deal; Email Marketing helps build and maintain relationships.

6.  Double Check Your Advertisements

Are you advertising on the Net? If so, make sure that the verbiage you have in your ads are ‘powerful direct response ads’ that compel the reader to contact you …and not just general information ads.

7.  Test and Measure

The key to creating effective marketing efforts is to test track and measure the effectiveness of your marketing efforts.

It’s time to evaluate what’s working and  what’s not.

 

 

How To Build A Better Budget For Your Company? Brook’s Keret Top 10 Rules.

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We are opening a new year , those who have not built a budget for 2014 , now is an excellent time to do so!

Here are our top ten rules of Brooks Keret to build a better budget :

1. It is desirable to build a monthly budget based on a quarterly period between one and three years of activity.

2. If you are building your company budget in Shekels, it is best to convert them by the average rate for the period prior to the construction budget to avoid a situation in which a change in the volatility of the exchange rate doesn’t have an impact on the extent of  your expenses.

3 . We recommend that you classify the expenses and attribute them according to the company’s operating departments, which include all relevant costs for the  departments’ activities.

4. While building the operating expenses , you must take into account all the expenses and distribute them according to categories, such as : insurance, professional expenses, travel, communications and more.

5 . When calculating salary costs , you should consider the overall employer costs, gross wages and social benefits, plus a certain percentage With respect to provisions for vacation and recreation .

6. You must take into account increases of investments in fixed assets, such as: moving offices, office improvements , electronic equipment, laboratory equipment , etc. All the above are on a cash basis.

7 . It is important to plan at least 5 % of operating expenses as unexpected expenses .

8. Assuming that this activity is distributed over several companies / projects, this should be addressed to the overall budget of the group.

9. It is customary to budget funds relative to the  number of employees in the company, such as leasing expenses, welfare expenses, work stations, gifts for employees, salary related expenses and the like.

10. When you are building a budget it is important to take into account the opening balance of net cash operating costs, reserves, and capital costs .

________________________________________________________________________________

The writer is Carmit Oron, VP of  Brooks  Keret.

E news by Dafna Rolls

BKadmin

I am often asked if cold calling really works or when to bring cold calling in-house.

Business owners can get meetings with potential clients through a variety of sources and many channels such as introductions from business partners and customers, using social media and LinkedIn. When I speak with business owners I always confirm to them that all of these strategies and avenues are great and that cold calling enhances and ensures that you approach your whole target market in a systematic way. A systematic way needs to cover all bases: getting all of the personal introductions that you can, working on your social media sourced opportunities, and at the same time, creating the list of all of your target market and starting to qualify good leads. When you create such a system you can make sure that your pipeline is always full with warm qualified leads.

How do you get started on cold calling? Start by finding and hiring the right inside sales people and creating the right bonus plan for them to achieve results (always pay a base salary plus commission so that your calling team can feel secure and meet goals). In addition, you will need to create the right tool box with all the information that needs to be sent out when a potential target shows interest. Successful cold calling relies on a strong database list, managed on a well-defined CRM program. Verify that you periodically provide your cold calling team with good updates and that you keep adding to the lead list as needed. Tracking and using a large list of well targeted leads including all recent contact with each of them is the key.

To make good of use of your time and effort you will need to understand who is the right person and the appropriate decision maker, in the target organizations that you are calling. Use this focus to structure a cold calling system and define a protocol, spend the time and generate your own training doc info. This should include:

• Phone scripts

• Typical Q&A

• Competitive data

• Email to be sent after the call

• Marketing info to attach to emails

• Qualifications – What will make a good meeting (you don’t want to waste the sales team’s time and energy on improper opportunities)

As calling starts, be sure not to send emails from a non-company email and to leave phone messages only after many attempts to reach the potential target. Always respect leads and nurture a relationship with the executive assistant.

 

How to choose the right outsourcing company for your cold calling:

• Make sure that you are the owner of the data base and that all notes taken during calling and nurturing leads have been updated.

• Speak with the callers that will represent your company and not just with the company owner.

• Can they provide you flexibility of number of meetings more/ less meetings?

• How do they work with your team?

• If they hire new person to work on your account do you need to train that person?

• Ask to speak with their costumers and ask the right questions.

 

When is it right to have our cold calling team in house or to outsource?

For every company the answer will be different but the first question is whether you will be able to manage the inside sales team? Have you done it in the past? What will be your ROI doing it in-house versus outsourcing?

There are no short cuts for getting meetings with your target market but when it is done in the right way, you will meet your target market and your costumers will be ones that you choose not just the ones that choose you. All you will need after this stage is a strong sales person that will know how to convert those meeting into sales… and this will be discussed in a different article

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This article written by Dafna Rolls Owner/founder Leads2deal

dafna@dafnarolls.com