A “Founding Father”: Hanan Brand
An Aquarium Follow-up
I first met Hanan at “Mix and Match” event hosted at the Jerusalem aquarium earlier in the summer. After hearing a bit of his story, I decided that I wanted to learn more. I reached out and spoke with him in his “day job” office in Talpiot, where he works as a Partner at Cornerstone Venture Partners.
Hanan’s MadeinJLM story
Hanan is one of the founders of MadeinJLM, an organization that built up the startup community in Jerusalem from scratch. He worked for Jerusalem Venture Partners and saw that there were very few Jerusalem companies that were pitching to the VC. Hanan was surprised because Jerusalem had all of the right components for a healthy startup ecosystem — Universities, one of the best Tech Transfer organizations (Yissum), large multinationals like Intel, Cisco, and IBM, and high quality service providers, but as he spoke to more and more companies, he understood that something was amiss. Every company said the same thing: “we feel that we are alone in the city.”
With determination, Hanan began to run events in Jerusalem specifically for the tech community to connect entrepreneurs to each other and foster a sense of collective unity and pride for establishing and growing in the city. The first series of events that he ran, “Beera-tech,” ironically took place at the “Tel Aviv Bar” in Jerusalem and drew surprising crowds of 200 people. At this event, Hanan met entrepreneurs Roy Munin and Uriel Shuraki, and together they turned this series of successful events into an ever-expanding, tight-knit network of entrepreneurs, investors, and professionals.
Playing a Dual Role
Hanan continues to play an important role in the startup ecosystem in addition to being a Chairman of MadeinJLM. As an investor at Cornerstone, he is constantly on the lookout for talent and frequently finds it in the Jerusalem ecosystem; ⅓ of Cornerstone’s entire portfolio is made up of Jerusalem-based companies.
Investment Strategy
The investment strategy that Hanan has developed is a product of his time spent in Ofer Brothers Tech Investment Arm and JVP (Jerusalem Venture Partners). Hanan specifically described Assif Stofman, Haim Eliash, Haim Kopans, and Fiona Darmon as particularly influential mentors on his professional development in the VC world.
From Hanan’s perspective, companies are easily able to raise money in their first round and in later stages when they have recurring revenues. Hanan invests in the void directly between those two points, where there is a team put together, but the company is not at an advanced stage where it can raise Series A from large funds. Cornerstone invests between $500–750k in companies to achieve “very specific milestones.” Hanan likes to see employee recruitment, increased PR, expansion to the U.S, and of course, customer and revenue growth.
U.S. Connections
Cornerstone is, at its core, a U.S. investment fund with offices in Israel, New York, and California. Because of this, it adds value to its portfolio companies by providing them with a built-in U.S. network, a crucial asset for expansion into the international market.
Portfolio Peek
DBSH: A Jerusalem-based big data company that designed a system that coordinates old and new databases. It has practical applications in banks and insurance offices in reducing risk of fraud.
SixdofSpace: A Jerusalem-based company that uses lights to track object positioning at an ultra-fast speed
User1st: A cloud-based software that makes companies’ websites more accessible to disabled populations. The recent rise in international regulations on website accessibility requirements makes the market for the company quite large.
Axonize: An IoT platform that enables companies to implement and utilize IoT sensors and systems effectively, connecting devices that transmit data to one another.
Thoughts on the Ecosystem
When I asked Hanan what he thought about the ecosystem today and its trajectory, he replied that he thinks there is a healthy balance between good startup companies and investors. “Most good companies do not struggle to raise money,” he says. To push the ecosystem forward, Hanan believes that the next step is to engage more large brands and corporations to open branches in Jerusalem. He pointed out one “success story” that happened recently, when a company called Mellanox opened a workspace in Talpiot, Jerusalem where its Jerusalemite employees can work half the days of the week. Mobileye’s huge deal with Intel was also a game-changer, showing that it is possible to have a large corporation grow and thrive in the ecosystem. Facebook and Amazon both ran developer group events in Jerusalem earlier in the year; events like these are the building blocks for promoting the next stage of the ecosystem’s development.
Firgun
One final point that Hanan emphasizes to me is that in Jerusalem, there is a lot of firgun, the Yiddish word for goodwill. People often focus on Israeli chutzpah, on the will to challenge the status quo, but in Jerusalem, people are happy for the success of others. Firgun really became part of the ecosystem in 2014, when MadeinJLM established July 17th as annual Firgun Day, a fun celebration of goodwill that took off internationally, even qualifying firgun to be included in the Oxford dictionary. Hanan sees firgun as an indispensable element of the character of the Jerusalem ecosystem, one that showcases the camaraderie of both founders and investors.
