Company Culture Matters Just as Much as the Technology, Says Venture Capitalist

The current trend of growth companies—companies focused on growing their revenue and customer base—started in the U.S. in 2008-2009, and in Israel three to four years later, according to Aaron Mankovski, managing general partner at Pitango Venture Capital. Mankovski spoke about growth and profitability at Calcalist’s investor event It Tech Two to Tango, held at the Tel Aviv events space of LABS, located at the Azrieli Sarona Tower.

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In Israel, there are many companies with high valuations, Mankovski said, but the focus should be elsewhere. “We have the highest number ever of companies with over $100 million in revenues,” he said. “In Pitango we have seven of those—we have never had such a number, and I think the industry hasn't either.”

Going from several employees or several tens of employees to a company numbering several hundred poses a few specific challenges, Mankovski said. It is not just about the revenues, ha said. ”One of the real challenges is creating a company culture. This is something that can kill your growth, and the company, if you can’t manage it.”  

Great technology is not enough on its own, Mankovski said. To court growth from the very beginning, you need to bring experienced people who know how to scale up a company and set up a good business strategy for management positions early on, he added.

In terms of Israel’s global position, while Israel may be a small market, its geographical location offers advantages, Mankovski said. “We are 10 hours from Hong Kong, 10 hours from New York, four hours from Europe,” he said, adding that while Asia is a more difficult market, it is a big one. Israeli entrepreneurs are often focused on the U.S., at least initially, but they need to think globally, he said.