A look back at 2023 with Hetz Ventures

A year of resilience, expertise, efficiency and connection

Liz Cohen

December 20, 2023

The last year can certainly be described as one of careful growth, incredible challenge, and persistent resilience. The adopted motto of 2023 became “Israel delivers - no matter what,” a sentiment sparked by the tragic events of October 7th and the incredibly difficult situation in Israel ever since. The reality is, we believe, that 2024 is the year we’ll see the Israeli tech ecosystem pushing even harder and continuing to stand up to the challenges and deliver, no matter what.

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At Hetz we are proud to look back and recognize that, despite the unimaginable challenges we have all had to face here in Israel, things are moving forward and we are optimistic about 2024. The running themes for us for the last year - resilience, expertise, connection and efficiency - stayed true, and continue to accompany us into the new year. Here’s a quick look back from our team.

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Resilience

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“ Like on our frontlines, so too in our tech industry - Israel’s up-and-coming generation is proving it can deliver .”

Judah Taub, Managing Partner

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By now we are all too aware of the unexpected turn 2023 took at the top of Q4, with the most tragic day of terrorism in Israel’s history. At the same time, what we know is that the Israeli economy was relatively strong before, and what we’ve seen on the ground is that the Israeli tech ecosystem is continuing to thrive. Israeli CEOs and founders know that more than ever, this is the time to hit their KPIs.

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The support we’ve seen from around the world is outstanding proof that Israel is as critical a tech player as ever. More than 800 VCs from around the world signed a letter of support in the early days of the war. The encouragement we’ve received from our executive network and LPs has also been fantastic to see. Meanwhile, unsurprisingly, in Israel, everyone has stepped up from the government’s fast track funding to VCs and bigger companies offering expertise, and founders themselves forging ahead, getting creative and lean with execution despite staff on military reserves.

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At Hetz we’ve spent a significant portion of Q4 supporting our portfolio, the wider tech ecosystem and the country with open office hours for founders, filling in the temporary staffing gaps for our portfolio companies, assisting with capital management and legal inquiries, offering ‘Group Hug’ consulting, and even volunteering with the war effort nationally with food packing, donations, and farming.

“Our portfolio adapts; that’s what smart startups do.”

Pavel Livshiz, General Partner

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The startup that can adjust and adapt through even the worst circumstances can make it through. We see that time and time again here, whether pre- or post October 7th. It's encouraging to know that the teams we've backed, whether in Israel or abroad, prove over and over they are creative, agile and up for any challenge.

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Meanwhile, our portfolio grew in 2023, in size and successes. This year we were excited to see the official launches of several early stage Hetz companies, including Gomboc, Silk Security, Aligned, Deepchecks, Inigo, Expanso, SuperDuperDB and Digma.

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Many earlier Hetz companies made leaps with their subsequent funding rounds this year, including Tabnine ($25M Series B), 8fig ($140M Series B) and Flox ($27M Series A). We're looking forward for more activity and advancement of our portfolios in 2024.

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Expertise

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“With deep expertise and direct access to executives, we’re helping transform innovative ideas into successful companies." ‍

Guy Fighel, Venture Partner & Head of Data Program

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In Q2, we launched the Hetz Data Program, affectionately known as SPARQL, to help founders at the ideation and early stage journey to form a successful company in the data space. It was the first of its kind program in Israel dedicated to working with entrepreneurs in this space to gain access to executives’ expertise, industry guidance and hand-picked corporate introductions.

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The program is led by Guy Fighel, who joined Hetz this year to offer his expertise as a former SVP at New Relic and entrepreneur himself. In May, he sat down with Redpoint’s Erica Brescia and Israeli data founders to discuss building data engineering companies.

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Like the Hetz Executive Network, this carefully-designed program is an opportunity to bring together startup founders and corresponding tech executives to build stronger companies in the long term.

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“Our job is to sift the value from the hype and to recognize the early seeds who have the potential to grow into category leaders.”

Yael Barsheshet, Principal

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GenAI was the buzzword of the last few quarters, and fortunately we were already in the space since 2019. That said, we saw a significant increase in dealflow in this space, and made an increased number of investments relating to AI infrastructure. Not only that, but our team created our own take on a GPT-trained startup advisory board simulator: Create Your Own Advisory Board. Read Yael’s exploration of our GenAI investment thesis.

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We also delved into newer territory: After spending the better part of the previous year investigating and building an investment thesis, in H1 2023 we made our first climate tech investment, and continue to build out a network around this sector. Read Yael’s explanation of our climate tech investment thesis.

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Efficiency

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“It’s not enough to council or advise; as investors, we gain as much from working alongside our founders.”

Anat Eitan. Partner & CFO

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It’s proven a lot more effective to sit side-by-side with our founders in order to support their teams with risk assessment, recommended frameworks, stress tests and capital management. Leveraging our own experience working at startups from early to late stage has offered added perspective.

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We spent a lot of time talking with founders - one-on-one and in a portfolio meetup setting - about startup valuations in 2023 and changing startup KPIs due to the market shift this year. In addition, we brought in Deloitte experts to guide founders on tax exposures and the optimization of tax structures until reaching profitability.

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We’ve expanded our support this year by offering increased talent support for hiring portfolio companies, especially at a time when hiring must be as strategic and targeted as possible.

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“Upgrading the way we operate internally isn’t only about increasing our efficiency, but setting an example when supporting others.”

Viki Temer, Bookkeeper

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Midway through the year, we expanded our operations team in order to revamp our in-house efficiency and make ourselves more available to support our portfolio with their own operations and finance as well.

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Connection

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“We grow by being curious - learning from our portfolio, our advisor network, and especially by experimenting ourselves.”

Liz Cohen, Head of Marketing

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Bringing our network together - whether founders, tech executives, industry experts or other investors - has been a running theme this past year. We covered much ground through portfolio meetups - discussing the state of valuations and early stage KPIs, tax optimization, how to launch on Product Hunt and support and resilience during the war. Our doors stayed open for portfolio companies holding their own community events. With happy hours in Tel Aviv and networking breakfasts abroad at RSA and AWS re:Invent, our Hetz Executive Network, portfolio, and industry peers came together to meet, connect and pursue bigger things.

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It wasn’t only about hosting, facilitating, and connecting. Our team got very hands-on throughout this year. We opened 2023 with the launch of repoInspector, Hetz’ open source GitHub repository data analyzer, and closed the year with new updates and features.

To dive into our new climate tech vertical, the team took on personal sustainability goals over the month of September with the Hetz Sustainability Challenge. And we closed out the year by building an domain expert-trained GPT for founders to simulate their own advisory boards with investors: Create Your Own Advisory Board.

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Who could forget our team becoming gaming ‘experts’ to challenge (or prank…) our portfolio company Gankster to a Call of Duty tournament?

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“Our role in the tech ecosystem is to contribute, beyond startup capital - we get hands-on across our communities.”

Alex Shine, Head of Operations

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We try to make an impact every quarter where we can and in 2023, we upped our game significantly. A few of the ways we’ve helped our communities include:

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Hetz joined the pledge of Power in Diversity to foster a more inclusive Israeli tech ecosystem.
Through Cleargiving, we’ve supported local families directly with donations.
Our team did community gardening in Tel Aviv to explore local sustainability projects.
During the war, we have been volunteering hands-on with Israeli farmers in the south.
We launched the VC Operations Forum to encourage collaboration and community among our peers.

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Of course, we are always coming up with new ways to support the Hetz portfolio - from preparing skill-building workshops, lending space for hosting their own community meetups, and sending sweet support during their busiest times - whether team hackathons or major product launches.

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Looking ahead into 2024

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We’re looking forward to seeing Israel’s resilience on display this year, along with new investment opportunities sprouting up as a result of new exposure and groundbreaking innovation during a challenging time.

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As always, Hetz is highly thesis-driven and our portfolio reflects the breakdown of our three core early stage investment focuses:

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