Ex-Viola partner Danny Cohen launches Sticker Ventures to back Israeli B2C
New $50M fund aims to revive a sector Cohen says local investors have overlooked for too long.
Danny Cohen, a former partner at Viola Ventures, is embarking on a new journey with the launch of an independent venture capital fund called Sticker Ventures. The new fund will focus on investments in companies that develop products and services directly for consumers (B2C), a sector Cohen says suffers from excessive neglect in Israel.
The fund, which is expected to manage $50 million, has already secured its first closing of about half that amount. Oren Charnoff will join Cohen as a partner. Cohen told Calcalist that he was looking for a younger partner with an American background and hands-on experience, and Chernoff was the perfect fit. Oren, 33, immigrated to Israel in 2018 from Maryland. He worked at a family office in New York and later at the venture capital fund Hanaco Ventures for several years. He also founded a startup in the e-commerce software sector and successfully sold the company after two years. “I approached him while he was on sabbatical from the company and immediately saw the potential in our collaboration,” Cohen says.
In an interview with Calcalist, Cohen explains, “I started my journey with a bachelor’s degree in computer science and psychology from Scitex, and went on to do an MBA at INSEAD. From there, I worked at companies like Commtouch and Gemini, where I was a partner until 2012. After that, I spent three years in Silicon Valley and was the first Israeli to participate in the Kauffman Fellows Program. During that time, I was involved with companies like Outbrain, Adap.tv, and Minute Media. From 2013 until recently, I was a partner at Viola Ventures, where I took part in successful investments like Lightricks, Tapingo (sold to Grubhub), Origami, and VGames. Now, I feel it’s time to embark on a new path and build a fund that focuses on an area I strongly believe in, B2C.”
Sticker Ventures is expected to manage $50 million and has already completed an initial closing of about half that sum. Asked why he chose to focus on the B2C sector, which is traditionally less popular among Israeli investors, Cohen says: “It’s simple, the facts speak for themselves. Look at eToro’s $5 billion IPO, it’s a B2C company. Last year, we saw three exits over $1 billion: Resident (a mattress company) and SuperPlay (a gaming company). In 2023, Il Makiage (Oddity) also achieved a major exit. Israel is proving its strength in B2C, yet many investors shy away from it.”
Why do you think there’s fear around B2C investments in Israel?
“Investors are afraid because they don’t fully understand what drives success in this industry. There’s a perception that tastes change quickly and customers churn easily. But the beauty of the consumer world is that it’s all driven by data, and this data is often higher quality and more accurate than what exists in B2B. B2C is rooted in marketing, and that’s its strength. People used to say marketing wasn’t Israel’s forte, but now it’s all about performance marketing. Companies in adtech and gaming have shown everyone how to do it well.”
Do you think Israel is producing enough companies that know how to succeed in B2C?
“Absolutely. There’s no shortage of opportunities, partly because there’s less competition here. Hundreds of new companies are emerging in these areas. The consumer sector flourished with the rise of the internet, then mobile, and now AI is creating massive shifts in consumer behavior, like people moving away from Google. We expect to see huge opportunities. There’s now a consumer AI solution for every niche you can imagine, personalized financial advice, for example, or AI-powered virtual mental health support.
“Beyond that, former executives from companies like Meta, TikTok, and Google are driving this sector forward. Every successful B2C startup is a new marketing budget for these big platforms, so they strongly support them. There are also consumer-focused cybersecurity companies like Guardio, showing the range of possibilities.”
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What kinds of investments will the fund make, and what’s the business model for successful B2C companies?
“We’ll invest in early stages, Pre-Seed, Seed, and Series A, depending on the category. Our goal is to find companies operating in large markets that can make significant changes. We’re looking at AI-driven consumer products as well as physical products. There are dozens of Israeli startups building physical goods, from fashion and cosmetics to food supplements and nutrition.
“It’s important to understand that in B2C, there are no fantasy multiples like in B2B. If a company sells $1 million in products, it can’t be sold for $300 million. To reach a $100 million valuation, you need to sell a lot more, and valuations are more closely tied to revenue. Still, the last two Israeli IPOs were B2C companies, which shows that you can build big companies in this space.”
Are foreign funds showing more interest in Israeli B2C startups?
“Absolutely. More and more funds want to look at Israel’s consumer sector and join us. We want to be a bridge between global capital and Israeli startups. Four American funds specializing in this field have already invested in our fund, and about ten more are interested in investing in Israeli B2C companies through us. We’ll invest most of our capital here in Israel.”
Is there still a perception that consumer companies need to be based in the United States to succeed?
“I think that perception is becoming less and less relevant. Companies like Lemonade, Wix, Lightricks, and Fiverr are all run from Israel. In general, you don’t need to be based in America if you’re not in direct, day-to-day contact with your customers. There is value in being close to your target market, but it’s no longer as essential as it once was.
“In the consumer space, Israeli marketing professionals actually have a significant advantage and a deep understanding of the global market. The wave of consumer-focused innovation is already here, and I feel this sector is gaining real momentum. I believe we’ll be able to create a meaningful push for the consumer sector in Israel, similar to what we see in much of the U.S. high-tech industry.
“In our first fund, we plan to make 25 to 30 investments, starting with small checks and increasing our investment in a few standout companies.”
