– New entrepreneurs aim for sustainable growth over quick exits. – BioCatch valued at $1.3 billion after Permira acquisition. – Significant increase in company valuations; from $30M to $400M deals. – Permira prioritizes long-term investments and innovative solutions. – Leadership emphasizes importance of alignment in vision and strategy.
A new wave of Israeli entrepreneurs is striving to create companies with lasting impact rather than quick profits. Gadi Mazor, CEO of BioCatch, emphasizes this shift at the Tech TLV conference, stating, “There’s a generation of startup founders and managers… with ambitions to build companies for the long term.” The differing market landscape is shown through a significant valuation increase of companies, with recent transactions averaging $400 million or more, contrasting with historical sales around $30 million.
Ran Maidan from investment firm Permira highlighted that the company sought innovative solutions to fraud-related issues and endorsed BioCatch’s mission. Permira acquired a majority stake in BioCatch, after initially investing through a secondary transaction. “We look for a large and growing market… and BioCatch does exactly that,” stated Maidan, emphasizing their criteria for investment.
In discussing the acquisition process, Maidan revealed that the search for a suitable investment began in 2021 due to rising global fraud challenges. Although Mazor initially declined a $50 million offer, he later recognized that aligning with Permira was pivotal for scaling BioCatch more effectively.
Permira’s investment philosophy centers around sourcing companies that possess outstanding leaders and innovative products, with emphasis on long-term growth. Maidan stated, “You can’t take a company public with annual revenues under $400 million,” indicating that BioCatch aims for substantial financial growth before any public offering.
Mazor clarified that the partnership with Permira represented a pivotal phase in their journey rather than merely an exit strategy, highlighting the alignment in their vision for sustainable growth versus short-term gains. He stated: “We wanted a partner aligned with our vision of growth… not to flip it for a quick profit in two years.”
The conversation also explored leadership insights, with Maidan outlining his principles, emphasizing the necessity for a CEO’s focus on long-term strategy. Mazor shared that Permira’s values were compatible with BioCatch’s direction, confirming the importance of mutual understanding in a partnership.
Observing the Israeli high-tech landscape, Mazor noted a dramatic evolution in exit strategies, reflecting societal ambitions. “Fifteen years ago, companies were sold for $30 million. Today, deals are reaching $400 million or more… our challenge is no longer about founders looking to sell too quickly.”
The article discusses a transformative era in the Israeli entrepreneurial landscape, where a new generation of founders is focusing on creating enduring companies rather than pursuing immediate financial exits. Insights come from leaders at BioCatch and Permira, a prominent investment firm. It emphasizes the significant changes in company valuations and exit strategies over the last fifteen years, underpinning a cultural shift towards long-term growth and sustainability.
In summary, the shift toward long-term entrepreneurship has been highlighted through key insights from Israeli leaders in the tech industry. BioCatch’s partnership with Permira represents a commitment to sustainable growth and innovation in response to market demands. The evolving landscape signals a collective ambition among founders to build lasting enterprises with significant social impact rather than seeking quick exits.
Original Source: www.calcalistech.com
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