Needless to say, the fervor of Chinese investors seeking Israeli startup and investment has been growing steadily in recent years. So entrepreneurs on both side sniffed there can be some opportunities, and one of them is providing investment intelligence.
For starters, one very good database you can access in order to understand a bit more about Israeli startup is StartupNation Central. The platform is detail oriented, and sometimes even provides more accurate information about an Israeli background company compared to the freemium version of CrunchBase. Let us look at a 3D sensing technology company Vayyar as an example.
CrunchBase wrote the company business as:
StartupNation Central explained as:
In a sense, it does sound the second description is better, even including a dynamic video demo.
The second database recommended would be Zirra. Founded in 2014 in Tel-Aviv, the company claims it automatically collects and aggregates unstructured data from myriad public and private information sources, then applies NLP and machine learning to produce different kinds of company analysis reports, such as company snapshot report, premium insight report or due diligence plus expert opinions.
If we use Vayyar as an example again, then the free information provided by Zirra as follows:
–Key People & Funding
And in a paid report done by Zirra, the analysis often goes much deeper and provides insights such as:
- HR Situation and Review
- Investor Position
- Investment History
- Inside Scoops
- Market Forecast & Exit Indicators
- Competitive Position
- Business & Marketing Strategy
Now China has its own version of StartupNation Central+Zirra, except that all content will be put into the Chinese language. The company is called Kaipule (link).
Here comes a video demo of Kaipule:
If we compare two paid reports from Zirra and Kaipule, the structure and content are essentially very similar. For instance, in the video, Kaipule mentioned K score smart rating system, but Zirra offers Zirra’s rating as well. So it begs the question what is the added value of Kaipule, aside from the language translation? The younger generations of Chinese investors are usually English fluent, so what is the point of using Kaipule, rather than Zirra?
The trick is any company with web crawling technology can extract open data on the public domain and generate some analyses. They are useful but not top notch. What is truly invaluable is those data are unavailable publicly or simply remain hidden in private. The scenario is often applicable to early stage startups under the radar. Leveraging its team in Israel, Kaipule said they are able to conduct one to one face to face interview with Israeli startup or in-depth offline investigation tailored to the demands of Chinese investors.
Kaipule showed a case study on an Israeli startup Hexa, specializing in 3D modeling for e-commerce, which by the way if you search on Zirra, the result is null. Kaipule not only demonstrated Hexa’s competitive landscape in the west (based on Hexa’s interview feedbacks) but also added its own evaluation on Hexa’s competitors and market positioning in the Chinese market. Furthermore, Kaipule highlighted what kinds of business opportunity and partnership Hexa is specifically looking in China. So these are the values Kaipule is hoping to bring to the table for the two sides. They said they want to act as a perfect matchmaker to link Chinese investor and Israeli entrepreneurs.
Though Kaipule told it has already curated at least 6,000 Israeli startups, this database is still in beta test stage and not officially launched yet. Thus the pricing strategy of the database has not been revealed yet. Kaipule’s China CEO showed a bit concern that many Chinese users often do not have the habit of paying for the intelligence report. Or even some have the budget, they might prefer to employ their in-house team to build their own knowledge base. For instance, recently a local media interviewed a Chinese VC firm Glory Ventures (link) which is very active in Israeli startup investment, focusing on some of the Israeli’s leading technologies, i.e. robot advisor, AR optical module, satellite communication, sensors etc. The founders of Glory Ventures worked for Infinity Group (a prestigious Israeli-Chinese private equity fund) in the past and established a profound network in Israel. Since 2015, they said they have done lots of shoe-leather grunt works and on site research in Israel by themselves in order to pick the winner in their focused sectors. So investor like Glory Ventures probably is not a typical buyer of Kaipule’s intelligence report.
The problem remains how to fully monetize Kaipule’s business model.
Author: Cecilia Wu