Laly David, OurCrowd: Foodtech is well-positioned to thrive long term

“Capital has flowed into VC as global interest rates have remained low, meaning that entrepreneurs have more capital at hand to grow than ever before, yet the supply of available workers in tech hasn’t grown as fast as the capital coming in. Until this changes, the wage spiral will increase,” says Laly David, Partner, Head of Business Development at OurCrowd.

David shared her views in CTech’s exclusive investor survey conducted with participants of the Poalim Hi-Tech and Calcalist Road Show event. The event brought together dozens of startups who pitched their venture to more than 20 leading Israeli investment groups and investors.

What trends are you most excited about investing in?

Personally, I am very excited about food technologies. We’ve witnessed so much progress and milestones achieved by companies in this field over the past few years and Israel is uniquely assisting here, with significant knowledge created in Israeli academia transitioning into actual products. We invest in foodtech startups across stages, from early stage at Fresh Start, our incubator in northern Israel, through to late stage. Our portfolio includes diverse investments such as Beyond Meat, DouxMatok, ReMilk and recently Maolac.

What’s your latest, most exciting investment?

I am very excited to be investing in Moodify and joining its board of directors. Based on years of research at the Weizmann institute, Moodify has developed a unique way to communicate with our brain via scents. These active scents benefit our well-being, attention and focus. The company is on a mission to decipher and digitize scent, making it as workable and manageable as audio and video, developing technology which it licenses to Fortune 100 companies.

Which industries seem well-positioned to thrive long term? What companies are you excited about (whether in your portfolio or not), which founders?

Foodtech is an industry well-positioned to thrive long term. The combination of significant academic knowhow, experienced founders and the active presence of the world largest food conglomerates with local innovation hubs in Israel, all create fertile ground for the growth of startups in this field.

What areas are either oversaturated or would be too hard to compete in at this point for a new startup?

The Mobility space seems more saturated and difficult to compete in. The regulatory scheme is dragging behind the pace of technologies, creating a gap between R&D and revenues. It poses an extra challenge for startups to bridge this gap. The SPACs provided some remediation of this issue but the SPAC landscape seems to have changed in the last few weeks.

What are you - as an investor - looking for in an entrepreneur or a startup?

We are looking for a magical combination of execution and storytelling skills.

What is your approach to VC involvement in the management of the companies they invested in?

The relationship between investors and founders is very delicate and not one size fits all. It requires open communication, trust and transparency.

What should be the level of a fund's involvement in solving a company's HR problems?

For our portfolio companies the biggest value and expedited path to growth lies within our network of investors. Our network includes thousands of investors and thousands of executives in multinational companies who are potential buyers, investors or customers of our portfolio companies. We allocate and dedicate significant resources to strategically leverage the network and OurCrowd's worldwide crowd to introduce our portfolio companies to potentially transformative commercial opportunities across the globe. We also have a senior OurCrowd executive who is an expert in media relations and press coverage who provides incredible support to our portfolio companies.

Where will the solution to the HR crisis come from?

I believe that the Covid crisis has created a huge opportunity for the Israeli ecosystem due to the increase we are witnessing in hiring talent from the periphery. With the hybrid work environment becoming the norm – as documented by OurCrowd's quarterly High-Tech Jobs Index – this creates the opportunity for more people to work from home and be full-time employees of leading technology startups.

How long will the current upsurge in wages continue?

It’s a supply/demand dynamic. As long as the demand of capital is larger than the supply of workers, the spiral will continue. Capital has flowed into VC as global interest rates have remained low, meaning that entrepreneurs have more capital at hand to grow than ever before, yet the supply of available workers in tech hasn’t grown as fast as the capital coming in. Until this changes, the wage spiral will increase.

Is it harmful to companies, to the investors?

Yes. It’s harder for companies to hire top talent at the pace required to grow. It also means that companies usually achieve less with more capital.

How can the damage of the growing gaps between tech workers and general workers in the Israeli economy be minimized?

The benefit of the growing tech ecosystem is also the growing number of tech-adjacent jobs. Covid has created the ability for anyone in the country, no matter where they live, how many kids they have at home, or their background, to get into tech. This bridge can minimize the damage. Beyond that, active programs to educate and increase opportunities in the workforce are the answer.

Share with us your golden tip for an entrepreneur presenting a pitch.

Be super prepared. Understand the audience. Are you pitching to raise funds, are you pitching to sell services or products? Who is the decision-maker and what would make your pitch a success for him/her?