"We're not looking to the US. Even if your product is better than the competitors there, it's still very hard to succeed. In Europe, the market is very diverse, and there are more possibilities and opportunities," says Keeprz Ltd. CEO Liran Mayost. His remarks reflect the spirit among the Israeli start-ups which went to London to participate in this year's TeXchange program to meet British retailers.
The TeXchange program, organized by the UK Israel Tech Hub at the British Embassy, the Economic and Trade Mission at the Embassy of Israel in London, and the Israel Export and International Cooperation Institute, is designed to open doors of British retailers, which are very interested in Israeli companies that are developing retail products and apps for both e-commerce and brick-and-mortar stores.
Delegation members say that more doors are opening, and face-to-face meetings are being held with representatives of Britain's largest retailers, such as online retailer Asos.
EZface Ltd. co-founder and VP global marketing Ruth Gal says, "Britain is a fashionable market and our goal is to bring our product here. We think that there is an open mind for our product." She says that EZface, which has developed an app to stimulate a customer's facial makeup in real time without the need to actually use cosmetics, was designed in advance for the global market. She adds that Britain is the most developed market for cosmetics and fashion, and the largest e-commerce market.
Israeli companies are familiar with the US market and Silicon Valley, and until recently, ties with the British market were undeveloped. This is changing, say the participants in the TeXchange program. London is not alone, of course, but Mayost says that it is preferable to other cities, such as Berlin. "There is also innovation in Berlin," he says, "but London is better, because of the links between finance and high tech. All the worlds come together."
Mayost has gained a foothold and signed an agreement for a pilot program of Keeprz customer retention app with Jamie Oliver's restaurant chain. "The delegation was very fruitful for us and we established many business ties, some of which will undoubtedly ripen into actual activity," says Moyast. He adds that most profits come from repeat customers and therefore, most of the work is to focus on them, rather than on securing new customers.
At a meeting at 10 Downing Street to honor the delegation, said Index Ventures partner Saul Klein, "The advantage of the British retail market is that it speaks the same language as in the US, but it isn't necessary to fly a whole day to Silicon Valley. There's a market here just five hours away."
"There is a strong commitment and appreciation for Israeli industry," added Prime Minister David Cameron business, trade and innovation adviser Tim Luke. "We want strong Israeli companies to list here rather than on Nasdaq."
Tech City UK CEO Gerard Grech said, "This is the time to be in London. The number of high-companies here rose from 40,000 in 2009 to 88,000 in 2012. At Tech City, we've increased the number of participating companies from a few hundred a year to 1,400. We have all the conditions to grow and raise financing."
Kano Ltd. CEO Yonatan Raz-Fridman developed the idea for his DIY computer company while in the UK, where he has resided for over a year, together with Saul Klein. "The best thing for a global company is to build it in London," he says. "It's a multicultural city, there is easy access to finance, a central local in the world, and much easier access to Israel than from Silicon Valley, for example."
Raz-Fridman says that the reason for the paucity of Israeli companies in London, despite the strong presence of foreign companies is that Israelis don’t know about the city's opportunities. "They immediately think of Silicon Valley, but the UK has an entrepreneur visa, something that no other country has, and it's easy to raise money here," he says.
A second delegation of 12 Israeli water technology companies, including Amiad Water Systems Ltd. (AIM:AFS), Mapal Green Energy Ltd., and CuraPipe Systems Ltd., is also in London. All these companies already have foreign sales for their proprietary products. Their representatives say that the UK is thirsty for water infrastructure solutions, because while the country has a lot of rain, its infrastructures are old and water exploitation is catastrophic. Britain's privatized water companies and developed water regulations make it easy for Israeli companies to do business there.
Published by Globes [online], Israel business news - www.globes-online.com - on March 18, 2014
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