Let’s face it — Israel has earned it’s “Startups Nation” title due to the B2B tech company concept.
The most common use case generally stars a group of friends, fresh out of the army, getting together to commercializing and monetize their technological knowledge and expertise in order to solve everyday corporate problems. After the first kickoff, sales and marketing teams smell a potential slam dunk, jump on board the new opportunity and — you guessed it — pitch it hard to US-based corporates!
That was the natural order of things when it came to Israeli startups making it big, and it made sense. For a while.
Over the past few years, we have been witnessing a major shift in the game. Now, more and more entrepreneurs are trying to build B2C businesses, operating out of Israel. Me, being the ever-so curious being that I am, decided to venture on a journey to find out why and how that is. My reasons for doing this are fivefold:
- The consumer market is a massive one (its 3 times the size of the technology market). If we disrupt the ‘natural’ order of it and create a new way of doing things — the sky’s the limit.
- The major success of other Israeli B2C companies has brought knowledge, expertise and confidence in the notion that it’s doable.
- Israel is a performance marketing empire, thanks to gaming, forex, and other online-based businesses.
- B2C is fun! Real people, a direct response to your marketing activities, and a chance to create a brand from scratch! It’s like giving birth to your dream.
- We live in a historical time where new brands can roll out anywhere, anytime. And there is nothing stronger than brand equity.
Now that we’ve agreed on the irrefutable fact that the Israeli B2C ecosystem is strong, healthy and has its footprint in almost EVERY VERTICAL, let’s break down the companies who are making it all happen (AKA, brands everyone can take notes from):
* I’ve been working on this post for some time now and most of the data is taken from online reports. If you stumble upon any inaccuracies, you’re more than welcome to comment and let me know!
Vertical: Auto-tech / Transportation
1. Waze (GPS navigation app, $1.1B acquisition)
This social navigation app went from “who’s ever going to invest in this sh*t?!” to one of Google’s biggest acquisitions — a whopping 1.1B dollar deal. No one thought that a consumer brand and thrive based in Israel, but along came Waze and really opened up the gate for other brands to do the same.
2. Gett (On-demand transportation service, $1.5B in valuation)
GetTaxi (or now, simply Gett) is our local version of the ride-sharing phenomenon taking over the world. Due to Mega investments from VW, a couple of acquisition deals and a now $1.5B in valuation, Gett is a star in our list of unicorn Israeli brands. So, Uber, who?
3. Via (On-demand shared transportation service, $400M in financing)
Only a true Tel-Avivian who had to suffer through the pains of local transports could have come up with this idea! Via’s super complex tech + brand equity that suits the life of the average New Yorker earned it an astonishing $400M in financing.
5. Moovit (#1 Urban transit app, raised $130M)
Moovit claims that by 2021, more than 1 Billion users will use Moovit to plan their inner-city trips. The company was founded back in 2012 and today, alongside another $50M investment made by Intel, holds the complementary title: “Waze for bus passengers”.
5. Engie (A device that helps you maintain your car, $4M Series A)
Engie offers any driver to take full control of their vehicle both on the road and in the shop. It’s a simple device that connects to any car, and reports back if any problems were spotted. Bonus: it also connects you with a recommended mechanic in your area! The company has raised $3.5M and is currently operating in Israel and Brazil.
Vertical: B2MicroSMB’s
6. Wix (Saas for micro-smb’s. IPO’d in a $600M in valuation)
The oh-so-famous DIY website builder that IPO’d in $600M valuation became a global leader. They’re not only a B2C company but a B2smb. Well, now that I think about it… is there really a difference between the two? That sounds like a great topic for a different post ;).
7. Fundbox (Online credit services, raised over $100M)
The B2SMB’s startup offers business owners a line of credit in a digital and super slick way. Yes, I said the business owner and not a consumer (calm down!) and I stand by them making this list. if you’re building a brand that goes after the end-user — it’s a consumer brand (and after raising $100M — it’s a big one!),
8. BlueVine (Credit services, raised over $500M)
Thank you banks, we’ll take it from here! Blue Vine offers business funding the way business funding should be way into 2019. No more begging a sleepy teller for a loan. BV provides small businesses access to capital when they need it. BV has raised more than $500M.
9. Next Insurance (Insurance, $130M in series B)
Next Insurance is basically Smb’s insurance made easy. NI has been around for just 3 years, and have already raised over $130M! And again, it’s a b2smb’s game, but we all get by now that if you build a brand that targets the end-user — you’re a B2C company. Congrats!
10. Tailor Brands (Automated logo and branding, $20M, Series B)
Such a cool and in-demand service! Tailor Brands helps small business owners with good, solid branding services, all done by an algorithm. One has to wonder — can a computer really replace hard-working creative folks? Well, their investors, who poured over $20M into the company — certainly think so.
11. Guesty (Saas for property management companies, series B)
Guesty simplifies all aspects of property management companies, offering an end-to-end solution that simplifies every aspect of the short-term rental business. The company is a Y Combinator alumni that have raised over $25M and on its way to complete a home run for its investors.
12. Honeybook (Business manager for creatives, $28M series C)
HoneyBook is a favorite of mine. A saas-based solution designed especially for solopreneurs and small business owners. Honeybook offers a very simple deal: You’ll do you (AKA, own your business and handle the creative side of things) and they’ll help with everything else, from marketing to booking and billing.
13. Monday (Workplace collaboration tool, $150M in series D funding, $1.9B in valuation)
Founded in 2012, monday.com is quickly becoming a staple among local and international companies looking for a better way to work together. The Israeli collaboration platform has raised $150 million in a Series D round of funding, bringing its total value to $1.9B to this date.
Vertical: CPG and E-commerce
14. SodaStream (CPG $3.2B in acquisition)
Ok, ok, I know what you guys are thinking. SodaStream is not a tech product nor a DTC, and I agree, but.. so fuck*ng what? It’s an Israeli based consumer product that exited twice. First, a $600M IPO and then again with a $3.2B acquisition deal by PepsiCo. Boom!
15. Maapilim (DTC, CPG, wellness, $4M Series A)
Maapilim offers handcrafted products for men, created with natural ingredients from the Mediterranean. Major Disclaimer: I’m in love with this company as if it were my own. Moving on. Maapilim with founded in Jonathan’s (co-founder) kitchen. His passion for smells, tastes, and marketing led him to launch the first Israel-based global wellness and grooming DTC brand.
16. GlassesUSA (DTC, fashion, lifestyle, Health, $12M series B)
Q: How does an Israel-based online retailer earn a huge amount of market share in the glasses and prescriptions domain? Simple A: Israelis are just good at creating and disrupting businesses and winning markets. B2B, B2C, B2G, you name it. And GlassesUSA is a great example of that.
17. Kidbox (Subscription boxes, apparel, $15M series B)
Welcome to the world of the subscription economy! Where consumers pay a fixed price each month and get a box full of goodies delivered straight to their doorstep. In Kidbox’s case (which has raised $15M) you’ll get super cool apparel, custom made for your child’s age and style.
18. Mixtiles (Home styling, $13M in financing)
One of the first and most successful consumer/commerce stories to come out of Israel. Mixtiles offers to turn your photos into affordable, stunning wall art. People are crazy about this product, and the founding team is crazy about its growth.
19. Brayola (Online lingerie retailer, $13.6M in funding)
With Brayola, any woman can find online perfectly fitting bras without having to try them on. The company’s idea is simple yet genius: use crowdsourcing to build a recommendation engine based on Brayola’s community.
20. Boxy Charm (Customized beauty membership)
Unlike their competitors, Boxy Charm prides itself on a monthly subscription of 4–5 full-size and luxury size well-known cosmetic products. After receiving an investment from the private-equity firm KarpReilly, LLC back in 2016, BC experienced a massive of 300%, positioning them as leaders in the subscription box industry and disrupting the $2B beauty industry.
21. Mynamenecklace (Owned by Tenen group)
So, everyone knows that when it comes to jewelry, nothing beats a one-of-a-kind piece. MyNameNecklace took that notion one step further and offered consumers a chance to take part in the design process, adding an even more personal touch to the finished bling.
Vertical: Food Delivery
21. Eat24 (Online delivery service, $150M acquisition)
Definitely my favorite story about a group of friends that built an online ordering business, bootstrapping it until the epic $150M acquisition by Yel came knocking. Creativity, hustling and classic Israeli boldness. Match made in heaven.
22. Tapingo (Online delivery service, $150M acquisition)
Another Israeli based online ordering success. The buyer was Grubhub, and the deal was reported to be $150M. The company’s mission is to: “help students become even lazier and cut the dreaded college cafeteria queue”. (free translation).
Vertical: Gaming
23. Playtika (Gaming, $4.4B in acquisition)
So much has been said about this company, so not much else is needed. The company performed so well, and it has been acquired twice: The first time $80M after just one year of activity, and the second time it was a little bit bigger acquisition… $4.4B bigger.
24. Plarium (Gaming, $500M in acquisition)
Plarium is a small family business that grew into a strategic games publishing powerhouse. They’ve been acquired for $500M by Aristocrat, an Australian casino company seeking to expand into the mobile games business. Well played Plarium.
25. Jelly button (acquired by Playtika)
We used to think gaming in Israel = forex and casino games, but the guys from JB prove casual games can come out of Israel as well. Their 1st game, the Pirate Kings, took Asia by storm, and that was what led Playtika to take the team and make it their own.
26. 888 (Gaming, IPO’d in $1B in valuation)
The mother and father of the Israeli gaming industry. This company was valued at $1B from the London Stock exchange back in 2005 and is now behind some of the best executives, entrepreneurs, and companies to come out from Israel.
Vertical: Consumer tech product
26. Vi (AI powered personal trainer, $40M series B)
This AI-based personal trainer makes people do things they’ve never dreamt of. Vi studies your capabilities, weaknesses, and aspirations and helps you reach your goals. It strives to become your key to success, and with $40M to back them up, they do so in superb design and technology.
27. Lumen (Metabolism Measurement Device, almost $9M in funding)
Lumen enables anyone, in a single breath, to see if their body is burning fat or carbs and what to do about it. This cool device has the right buzzwords: DTC and digital health, the company has a killer team and $8M in funding.
28. Intuition Robotics (Digital companion technology, $22M)
A proactive Artificial Intelligence-driven social robot, designed to encourage an active and engaged lifestyle by suggesting nearby activities and making it easier than ever to connect with loved ones. The company has raised over $20M and will launch their product soon.
29. Healthy (Home-based urinalysis, Raised $60M in series C)
Healthy is changing the health services game, big time. The digital healthcare startup is leveraging AI to bring professional-grade medical imaging to the homes of those with kidney disease by presenting the only FDA-cleared and CE-approved at-home urine test. To this date, they have raised over $60M is series C funding.
Vertical: Marketplaces
30. Fiverr (Digital marketplace for online services, IPO’d in $600M valuation)
What would you do to $5? Edit this post? Design a logo for it? Apparently so would a lot of other people! This platform is now the biggest marketplace to digital services, connecting freelancers and entrepreneurs with business owners. They raised over $100M and recently went public with a $1B valuation on the 3rd day of trading.
31. Puls (On-demand in-home repair, $100M in financing)
Puls provides fast-response, in-home repair, and installation for smartphones and smart homes, through a network of skilled technicians. Almost $100M helped this marketplace/on-demand/smart home/gig economy great consumer story to be.
32. Zeek (Leading marketplace for selling and buying gift-cards)
Zeek enables users to sell their unused gift cards in a discount to other users so somebody will use this voucher. Zeek changed the perception regarding gift cards — explaining its real money that shouldn’t be wasted, and became the UK’s market leader.
33. Missbeez (On-demand beauty services)
Misbeez offers busy, modern women a variety of lifestyle & beauty services to their homes or offices 24/7. Missbeez’s mission isn’t just about beauty, but more about women empowering women and supporting their independent careers.
34. Worthy (Online marketplace for luxury goods, raised $8M in series B)
Calling all bling lovers. Worthy is an online marketplace for selling and buying pre-owned diamonds and gems. With a motto like “All We Want From You Is To Sit Back, Relax, And Watch The Offers Roll In”, it’s no wonder they raised $8 million in Series B funding.
Vertical: Real estate/ travel / hospitality
35. Selina (Co-vacationing/working, over $200M in financing)
These guys really hit a home run with this one. Selina is by far the coolest vacationing/working nomad experience in the form of an on-trend hotel chain! It’s super millennial and fun (maybe that’s why they raised $180M) and totally value-for-money.
36. Mindspace (Co-working space brand, $35M series B)
Yet another co-working space? Not if you ask the founders. The company has offices in over 10 cities (and counting), thanks to the $35M in funding and a trend, that although it feels worn out, it is only getting started.
37. Venn (Co-living company)
Venn targets cool areas near big cities, build buildings to live in, bars to hang out at and other everyday must-have services (like laundry, commute stations, co-working spaces, gyms, etc.) and invited young professional crowds to come and populate their new “town”. All you have to do is move, Venn will take care of the rest.
38. Meet in Place (Co-meeting space)
Meet in Place is sort of like the WeWork for meetings. They offer a rent-by-the-hour trendy designed, fully-equipped meeting room for any professional purpose. It’s gorgeous, convenient and cost-effective. What’s not to love?
Vertical: Education
39. JoyTunes (Music learning service $17M, Series B)
This company’s motto is “anyone can play,” and their products encourage millions of people to achieve their musical dreams. After struggling as a B2B company, they started targeting consumers, and have been thriving ever since.
40. Jolt (Co-learning brand, $10M series A)
Jolt is reinventing the way adults learn new skills by creating a global community of learners and by cultivating innovative learning spaces. Professionals can easily learn how to future-proof their careers from world-class experts spanning different fields. They ended up raising over $10M.
Vertical: Media, Content, Publishing
41. 5min (Videopedia for life, acquired by AOL in 2007)
Probably the first-ever Israeli B3C exist, 5min syndicates how-to and instructional videos to other sites. Pre-acquisition, company data stated that they have over 200,000 clips, generating 110M views a month and spanning across 800 different sites.
42. Minute media (Owner of 90min, 12up and other publishers, $78M)
Minute Media has created the industry’s leading digital publishing platform, encouraging fans to create, publish and distribute endless content around the world. The concept works as they own and operate over five different sites and became one of the biggest global online publishers to this day.
43. IMGN Media (Content platform, social media, $6M)
IMGN is a tech-media company building content brands for multicultural and niche audiences. The team and their super-smart tech curate and create popular IG channels and partner with the biggest brands out there today.
44. Roundforest (online shopping-assistance. Bootstrap startup)
The Israel-based company is out to transform the way users buy and brands sell by using data analysis and predictive analytics technologies to showcase products tailored to the shopper’s needs. Oh, and they also deserve a round of applause for being one of those unicorn companies who were able to avoid VC funding (AKA, bootstrapping) and prove to us all — it’s hard but doable.
Vertical: Insurance, DNA, Fintech, Design, Utilities
45. Lemonade (On-demand insurance, over $450M in financing)
This company attempts to do the impossible: to break the paradigm of Insurance (AKA, a total nightmare). Lemonade developed a super-fast, easy-to-use product designed for the short attention span and zero small-letters-tolerance of millennials. It has been around for 3 years now and has already raised $180M. Given how quick and aggressive they’re being in their plan to conquer the market — I’m pretty sure we’ll hear a lot more from them soon.
46. MyHeritage (DNA company, a leader in the “roots” industry)
MyHeritage started out as a super-techy family tree builder (like the one we made in 7th grade!) and the perfect reminder for when you forget your grandma’s birthday. Today, after $50M in financing and a product in the DNA tests space, the future of this company is even more interesting than the past they explore.
47. eToro (Social investing platform, $222M in financing)
The successful social trading and investment giant became even bigger when it enabled users to buy and sell crypto assets with the tap of a button. The company has raised $222M, and that’s without branching into the US market. My guess? The best is yet to come for these guys.
48. Lightricks (Photo editing, raised $70M)
This one is also a favorite of mine. Basically, a group of Israeli geniuses got together and created a photo editing app that’s like Photoshop for mobile. They showed the world that being creative with your phone is super easy and fun while being the biggest bootstrap success story to come out of Jerusalem.
49. Any.do (Productivity tool, $6M)
One of the first and most popular productivity tools out there, Any.do is an award-winning app that helps users to stay organized and get stuff done. This great and innovative product (version 1 was released in 2011) is similar to the common Israeli entrepreneur: techie, efficient, super slick and gets shit done. Fast.
50. Houseparty (Video chat app, acquired by Epic Games / Fortnite, $70M )
Houseparty is probably the most millennial concept to come out of Israel. What started as a live video tool, is not a face-to-face social network, trying to become more Fortnite, less Facebook. It’s brands like Houseparty (Yevvo, Meerkat and Air) that are causing the major league players to sh*t their pants.
Shall we summarise?
B2C startups can be created in Israel and become extremely successful. Why is that? Because:
Know any other great B2C companies? Got any feedback? Own a B2C venture?
I’d love to hear from you!