Marco, again, thank you for this
Full opportunity, and for bringing the very prestigious noah brand into israel
Thank you so again. Hi everyone my name is ronan, year i'm a. General partner of viola ventures which is the?
Early, stage arm of?
Viola, group the largest tech focused investment group in israel
And this presentation is part i think of a dialogue that, we are constantly having with the industry trying to
Understand and ask ourselves the tough questions as to where
We are what are the good things that are happening in the industry and also what are the challenges that are happening
Industry and i think that in general?
As an industry, we should be a little more?
there are there are certain challenges i think that, we are always trying to look, through the
Front window. And not through the back mirror and making sure that the innovation pace can, continue and i think that
It is not necessarily going to happen and i think that, we have to work hard in order for this entire
magnificent ecosystem to continue to thrive
And i think i would like to kind of walk you
Give you, a glimpse into our meeting rooms what are the issues that, we are discussing what are the questions that
We are asking ourselves and definitely would appreciate the feedback later later on so
ten observations one per minute
and
I'll start i'll start i'll start with the challenges so an
Abe finkelstein from from vintage in his opening presentation showed a lot of statistics as to
You know kind of the trends in the in the in the world vc industry or the world and the israeli industry as
Well there is one data point which i think that people tend to overlook, which, we think is very very important?
and and that we are seeing that although the money flows into the industries and all-time high and
Attack in general is the best return on investment in any other sector in the world actually the number of early-stage investments
In israel is declining as you can see here and this is very very consistent to what
We are seeing in other places in the world
By the way apart from europe which, is kind of still recovering from from a decade ago but in the u.s.
We are seeing the same trend, which for two consecutive years the number of new
Companies that are being funded is at a decline of about 15% year of the year this is a, major issue how
Come, why is it happening so much money in the market
You know best roi?
Ever what is happening over here and?
And this is a this is a question that we've been asking ourselves and i think that the kind of the short answer just
Because we don't have a lot of time to expand, is that we believe that?
we are
What we call in-between innovation cycles kind of the last decades main
Innovation the cloud that shows the social networks the mobile etc have reached kind of a maturity stage, while the new
Things that are coming the ai the iot the automotive etc have not matured yet
To, the point that that you know every investment is justifiable so i think that i would like to kind of you know
pose some of the question but, also see where, we think are the may be
Places in which we are going to see the entire industry going out of this kind of?
Temporary, deep back into a thriving
Industry, i think that one of the main questions that, we are asking ourselves is it solved and
i think that in general the vc industry, worldwide has long believed mainly on it
It was it management it was?
Monitoring it was devops it was development tools it was the application that, we are running over it as?
We have seen the cloud, which, is kind of you know taking over everyone has has created a
Basically, each time or each year that the large cloud, four providers are coming with, new
Services that basically making it easier to develop to develop application and are taking away, some of the need
Some of the need, for than the the
Consumers or the enterprises to manage their, own it this is a
Huge part of the industry and we are asking ourselves
Could it be that this huge part of the industry will actually decline and will fade and go away over the next
five to ten years
The next thing is because i said okay, well?
Well there are certain areas that are
Going, down but there are certainly many areas that are going up and definitely ai is one of them but, while, we but while?
We see many many companies that have the technology that have the algorithms that even have the computing power in the infrastructure to do ai
actually the ability to build very significant companies
Israel is is highly dependent on access of unique data in most early-stage companies that, we are seeing they?
Have the technology, they, don't have the data and by the way everybody is saying, well facebook have
The data and google have the data and and we say it's not so true they, have part of the data they
May, have part of the data of a user behavior
They, still don't have our healthcare data they
Still don't have our or all of our financial information data et cetera et cetera and we believe that the the he?
Ingredient of making an ai company successful is not only the ability to have some great data
Scientists and machine learning engineers but, is having access to unique data
which is becoming the number one problem of being able to create those the industry i
Think, that iot was kind of the biggest, buzzword that that, was here maybe two or three years ago but when
We are starting to when we are drilling down to what iot actually means in terms of the individual investment of the individual companies
Some major questions are come are coming so what am i selling, and what is the business model behind this am i selling a?
Low power device that's usually tend to be commoditized, and that's very low
Margin, and how do i distribute it do i do kind of a a?
Networking part that kind of the you know, the large players are already doing this so is my innovation
In the analytics that i can, provide in the cloud from obtaining all the data from the sensors could
Be but then it's a cloud investment it's not an iot investment so where exactly is the business model on behind all of those
Elements and how can the early-stage startup community can actually innovate
With the solid business model in our mind is still a question that, we are asking ourselves and having a
Important dialogue with, with, the industry
The open, source model that was supposed to take the world by storm and democratize
You know the entire software and make software available for everyone and increase the trust etc is
doing two things that, we did not anticipate, one
It's killing entire industries that used to be billions of dollars and now
You know it's very hard to
To innovate of them and i think everyone understands this i think the spark part of the other things is actually
Open source is being misused
By, some of the, major players like of the clogs of cloud, providers were actually taking the open source that
Was built by you know other startups and something else offering them the
Services they otherwise were monetizing it and a lot of the startups that have actually built
building the software made it available to the community are being kind of
you know hurt
By the open source in which the adoption is done by the large players instead by the
Individual players and individual programmers, and that's becoming, a, major, major issue
You know as to as to the future but i think again
That not everything not everything is dark and we are seeing i think part of?
Bright light i think that thing could happen over the next a few, years that, we are very excited with?
first of all as
We said it maybe the entire concept of building horizontal solution on storage applications etc is going
Away, i think that welcome vertical solutions i think that, we are already?
Only starting to do this and most of the consumer services that
We are consuming the ubers of the world etc they have all have very deep technology under that
We are not using this because of the technology, we are using this because they are providing us full service when i'm buying
When i'm paying over i'm buying a cab ride i'm not buying technology
And i'm not utilizing this technology i'm buying the actual the entire stack and the services and this is going to be a very huge
Blockchain, not in the corner in the context of cryptocurrency but in the core but in the context of it infrastructure we believe that?
presents the right philosophy
Meaning distributed architecture that, we will rethink the trust model as my, my predecessors here
Discussed and will bring you know, some new it benefits
But the actual infrastructure there is today whether it's whether it's a you know
Blockchain ori theorem or the other infrastructure are lacking a lot in their
Infrastructure performance security trust capabilities etc and therefore
We believe it's the right philosophy but a lot of innovation still needs to go into turning this into a
working model
One of the things that, we are hearing a lot, because
We like so much to innovate to innovate i think that in general, we have the tendency to kill
Industries very very quickly, big data, this is so 2013 what you're talking about you know
We are way past these kinds of things
Industry, tech industries takes a, while to mature and i think that what we're hearing, big data is coming, may be replaced with
ai that, we are only at the beginning of of trying to understand
You know making sense of data, we may have solved the problem of how to store it and how to access it really how
To, make inside out of it and you know instead of minding data mining knowledge
We are still at the beginning and this is probably a decade or two long
Journey that we'll all have to take that, we'll all have to take together
One thing that a i did bring to the world
The semiconductor industry, worldwide was basically dead basically dead moore's law
Has reached an asymptote no more
possibilities to improve computing etc but i think
We are entering a different age in which the definition of computing is going to change the autonomous car. Is going to have anywhere between
4,000 to 6,000 different chips on a single car. These needs to be different, chips that will have they will have to do
things differently
they will have to have the reliability of an airplane in order for it to be
Reliable enough to be on the street so we are seeing a
You, serg, which is definitely placed to the strengths of israel of a?
New kind of companies that is going to rethink the compute model and we can go beyond
semiconductor into even to quantum computing
And other things that are going to change the
Compute model in general and i think that you know talking about the alexus the google home of the world there is something more fundamental
Here most of our interaction with
Computing, was through keyboard, and mouse for the past 40 years, we believe that a voice and?
Video and in general and in general other means of communicating is going to be very very significant to the point that
We call it the new, operating system and that is going to completely change the world that
We are living maybe this is the right way to monetize iot we don't know
But definitely there are some interesting things so to summarize i think that
we are facing
There is a trend and we cannot ignore it early-stage investments are going down because
We believe the world is now trying to figure out?
How, do we take the, new
Technologies that are arising and actually turning them into a real business model with real customers
You know with with real companies to be built behind this, we are obviously, still going to see industries take
Long, we're, going to see still sees the benefit of the previous 20 years coming with us
But, we have to face those challenges on the other hand, we are seeing some great opportunities, we do call upon everyone
The intrapreneurs community the corporate community and everyone to work together with us to try and figure to figure out
Those questions, and make sure that, we all continue to thrive thank you very much
you
