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Aleph

Empowering Others To Riseup!

Our investment in RiseUp

When Yuval Samet came to see me some six years ago to brainstorm ideas for his next company, I never imagined it would look like RiseUp. When he came back one year later with Tamara Harel-Cohen and Iftach Bar, looking for investors for their new company, he was sure Aleph wouldn’t invest, because they were only targeting the Israeli market. After all, who would want to initially target a market of only nine million people? When the three of them then said they were planning a subscription financial product targeted at the lower socioeconomic levels of society, they were sure I would walk away. Financial services businesses, after all, should target the top 20%!

We led the seed round in RiseUp some four years ago and I could not be more thrilled to partner with Yuval, Tamara and Iftach to transform financial services. They started humbly, finding product-market fit in the living rooms of single moms who were determined to rise up financially and personally. Today, RiseUp is growing fast and already making a giant financial impact on people’s lives and will have a lasting impact on the economy. You see, many financial services are broken, particularly for those who need access most. Much like Lemonade disrupted the conflicted model of insurance in which insurance companies make more money by rejecting claims in your time of misery, RiseUp will help realign banks and other financial product providers that make more money when you miss a loan payment or provide high fee products that are not in the consumers’ best interests.

This vision and company is part of a theme I have articulated over recent years called investing in humanity. It is also part of the 21st-century investment thesis I articulated in my latest book, “The Tree of Life and Prosperity,” where timeless values and principles create better and more profitable businesses. I suggested in the book that people will and should pay a premium for better products and services that are more aligned between business and customers and less conflicted in their business model than 20th-century businesses. Many thought RiseUp had lost its marbles when the founders suggested charging 45 NIS (about $12) per month to the lower socioeconomic levels of society for a service that tells you how much money you have left to spend this month. But they charge that premium and people pay willingly because it is a premium product built explicitly to serve their interests and proven to improve their cashflow and help them build savings. This business model and the data insights that come along with it enable RiseUp to deliver less expensive and more aligned financial products. They inverted the model by taking the customer’s side, the demand side, watching customers’ backs. By doing so, RiseUp has moved thousands of families out of overdraft and into savings and investments. These are net new investment dollars in the economy and a way for these families to plan for the future.

The core of RiseUp is its community. RiseUp members (remember: they pay a subscription fee) are challenging each other to save more, sharing tips and tricks and asking questions of their peers who are rising up out of overdraft. They are also voicing their hardships, challenges and, increasingly, their aspirations. They have built a covenant of trust, self-efficacy and mutual economic empowerment that is growing the pie. They are saving and investing in a smart way, together, building a coalition of economic growth and long-term family prosperity.

I think that starting in Israel, a mutually responsible society, turned out to be a feature and not a bug. This financial revolution of self-efficacy and mutual growth will eventually be exported to many other countries and can influence more sound personal economic growth globally, but its foundations are deeply Israeli. It also turns out that financial services in Israel is a much larger market than we all initially thought and the Israeli economy is growing fast. RiseUp is leading the way forward to creating a future of capitalist financial products that are good for customers and therefore for the economy and society.

Let’s all rise for RiseUp! Join the community!

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Aleph is a venture capital fund focused on partnering with great Israeli entrepreneurs to build large, meaningful companies and impactful global brands. It is a partnership of Michael Eisenberg, Eden Shochat, Yael Elad, Aaron Rosenson and Tomer Diari. Visit Jobs.aleph.vc

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Michael A. Eisenberg: Six Kids And A Full Time Job

Michael A. Eisenberg: Six Kids And A Full Time Job

VC, Israel, Internet, Family, @home, @work, @israeli, @politics, and lots kids

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