Lessons From Startup Nation — How do Roots in Israel Set the Foundation for Success? | LSI USA '25

Michael Habib  0:05  
Good afternoon, everybody. My name is Michel Habib. I'm a managing general partner at alive Israel Health Tech fund. We are a Medtech and digital health mid late stage fund based in Israel. Happy to be here my first time to participate at LSI. Very excited and impressed by the organization and the people I'm meeting here, we have a very good panel of speakers from Israel. All of us are from Israel for a change, so it's a it will be great to hear what we have to say about the Israeli Medtech industry. So I will ask each of you to present himself, who is, who represents the conference with the leading question, can you describe one characteristic aspect that is really outstanding in your perspective about the Israeli Medtech industry?

Beatrice Chemla  0:50  
Hi, nice to be here. So I'm Beatrice Chemela, CEO and co founder of IMMA. IMMA means maverick in Hebrew. So we built a comprehensive solution, hardware and software to allow women to perform their own transvaginal scan by themselves. First use case is IDF, so from the perspective of Israeli Medtech, so what he can say is that we built a product, and I think that what we did is that we combine hardware and software. And we did this combination thanks to a very high tech technology from software and AI in Israel, but we were helped by the med tech as well ecosystem outside like the US, because our hardware part of it is built with a manufacturer here in the US. So it's a combination of the two ecosystem which brings us to this huge product.

Michael Habib  1:48  
Ilan 

Ilan Uchitel  1:48  
Michel, thank you for having me on this panel. My name is Ilan chichel, the CEO and co founder of CAPS Medical. CAPS Medical has developed a minimally invasive solution to target wide range of solid tumors, with our initial focus being on bladder cancer. We're clinical stage company. We have completed a very successful clinical study and now aiming towards our next stages of development, which will include a pivotal study, which will be crossover between Israel, Europe and the US. And I think it's a segue to your question, Michel, what is unique about CAPS Medical? It feels like like about and about Israel. It feels like Israel is the bridge between continents, a were very developed and self enforced ecosystem, with an eyes towards the US market, on the one hand. So we started from us books and now engineering and MBA courses, we target in the US market. This is how we program. However, we can leverage resources from other continents. We have a close pro committee to Europe, both for R and D, aspect manufacturing, asset specific capabilities that other continents lack. We have manufacturing capabilities in Asia and China, which is very quick turnaround, very helpful. And we have the ability to integrate all these three different cultures in a one very unique product that we actually will deliver the first

Michael Habib  3:10  
great, great thank you. Moving to twika bokeh, Hi,

Tzvika Barkai  3:15  
glad to be here. My name is Tzvika Barkai. I'm the co founder and CEO of Picodya. Picodya has developed micro fluidic lab on a chip solutions, enabling us to do diagnostic IVD diagnostic, both for research multiplexing in a very flexible and low cost manner, and for clinical point of care on your patient diagnostics. I think the uniqueness about the Israeli ecosystem the Medtech is it is actually a big, I would say, incubator, with a lot of small incubator within all these systems are in a small geographic with very good relations between entrepreneurs, between a federal organization within Israel, a lot of OEM and technological manufacturing, a lot coming out of the army capabilities that has been developed over the years. And it's a great, big alpha site for almost everything, while looking at the US market as the main market, as coming as a better site and for commercialization at later stage.

Michael Habib  4:19  
Thank you Tsvika And our last panel member, Boaz,

Boaz Lifschitz  4:25  
thank you Richard, thank you for having me on this panel. My name is Boaz Lifschitz. I'm one of the founding partners of peregrine ventures, a healthcare fund in Israel, about the uniqueness of Israel, I would I would say it's a combination of, I would say, ancient history of of the 1000s of years of arguing in different kind of aspects. In. In intellectual studies. I think it has a has a vast impact on the characteristics of the people of the country. And then and the second one is a modern history of Israel. It says we are still a very young country, and it's a country of immigration, of of struggling to develop a country, and this turns into a big desire and hunger to excel. And this combination of this ancient history of of intellectual arguing, intellectual studying, together with the Thrive of of many cultures of immigration creates this interesting, I would say, vibrant technology

Michael Habib  5:56  
in the country. Thank you, Boaz, so you know, reflecting on all your comments, I would like maybe to engage on the discussion about the Israeli Medtech industry compared or in conjunction with the American market and the American Medtech industry. So on one hand, the way I see it is that Israeli, me tech, is almost like a natural, organic extension of the American industry. So we feel like, you know, part of one big family. But on the other end, we we are unique in many aspects. So I would like to ask you, between looking at at the Israeli Medtech as part of the American med tech and being unique, where do you see the similarities, on one hand, which are great for us as part of this year large ecosystem. But also, where are the the uniqueness of the Israeli entrepreneurs? What is so unique about them compared to to what we're used to see here in the States? So maybe I'll start from from Boaz

Boaz Lifschitz  6:59  
Harris. I think it's similar in aspect of inventing new new technologies. And you have, you have a similar, I would say, system of universities and and system and institutional of excelling in those different kind of of studies. In that respect that creates knowledge and and, and also the desire to start new things, to create new things in that was in that respect, I think it's, it's it's similar, however, the difference is the Israelis are more technological oriented and less commercial, obviously, because of the nature of the place we are in Israel, far from the market and also, but I said before we also, it's a younger it's a, it's a younger industry. So I think it takes Israelis, took us a while to understand aspects of commercialization and marketing. So here, here's a difference, on the other hand, in development, the Israelis are a little bit more, I would say, you can develop a technology in Israel cheaper than you can develop something in United States. That's a bigger so that's a big advantage in the same level, it's more efficient. It's the working power is a bit cheaper. So we have an advantage in adventures there. But the gaps are are not as big as they used to be. So I think we're going into interesting collaboration.

Michael Habib  8:56  
Thank you. If we are looking at the Israeli spirit, you know what the title of this panel is? Lessons from the startup nation in terms of the roots in Israel set for the foundation for success. What's in the Israeli character really creates the success of the Israeli industry, the Israeli metric industry, compared to other you know, other nations are Are we that unique? I mean, we have great technology, but do we have a special character that really characterizes us? Maybe, maybe it's rica you can invite us on this.

Tzvika Barkai  9:31  
So following all Boaz mentioned, I think what we have that allows us to to make you know the advancement on the development of technology is the the innovation and the fact that we are young companies, so not everything is already straightened out over there. So we tend to think out of the box. We tend to improvise in early stages to make it quicker and shorter. We tend to be very agile. We respond to a. Changes very quickly. We are in surrounding which is very challenging. So it's not always the plan is fixed and we're able to follow it, to follow on that. So I think all of these give us the anything, the leverage on the first stages, while we understand that the market is not in Israel. And when we need to scale up, we need the the American, I would say, boots on the ground. We need to follow the regulatory pathway, which are all here in the US. And usually we know what, what we don't know, and how to synergize it with the US, I would say med tech ecosystem. Sometimes we know we don't know it, but sometimes we know it a little bit too late, but usually we we know how to catch it up later.

Michael Habib  10:56  
Thank you. Speaker, Beatrice, do you feel that the Israel entrepreneurs are already learning all the necessary lessons in coming to the US market, you know, working with American partners, or are we still acting as as a, you know, as an alien entity coming to the big to the big America? How mature or not are we in this respect,

Beatrice Chemla  11:21  
I think that we have Israeli and US ecosystem. We are very linked. And it's like something like natural. When you build a solution in Israel, as you said, Something agile and quick and dirty sometimes, and then you have to, you go to the US market, it's like natural. So the ecosystem are very linked. For example, from the beginning we built an advisory board with us, advisors, with European advisors as well. So from the beginning, we thought that we have to be international. We are very small. We won't be able able to stay, of course, in Israel only. So from the beginning, we think being because there is no choice. So this good thing of having no choice, we have to go outside, is something which brings us very quickly to the US. And there are so many natural connect, connection between Israel and the US. But these things are undone very smoothly and and with a lot of friendship, I should say, so a good thing for us and good thing for the US as well.

Michael Habib  12:30  
Thank you. Beatrice. So on one hand, we are learning, you know, we are adapting, and I think that we are becoming more and more integrated with the American ecosystem, culturally, but also business wise. Ilan, do you feel this is the case, or do you still feel that there are, you know, gaps between how we operate here and how the American industry expects us to work with the Where do you see the gaps and that still needs to be worked on or closed?

Ilan Uchitel  13:01  
Well, thank you for the question. As a general case, I would say being a second time founder is better than being a first time founder, and I think that a medic ecosystem is already composed of second and third time founders, which makes the integration much more streamlined. I had personal experience in working with companies that begin from scratch, from idea on the MAR on the napkin, going into commercial stages very quickly, and adjusting along the way, in some cases, with very painful lessons. And I have been in the company that started as a same idea on the napkin and evolved into binational organization headed by a very senior ex corporate CEO, and integration was very streamlined. I think it very much depends on the personal experience that the team brings to market. And the Israeli market has been through very painful lessons over the past two decades, allowing to be very streamlined, integrated into the economy. You can see that actually in the LSI conference, it's my third LSI conference here, I think I know more entrepreneurs from the other side of the of the pun than I know from Israel. Again, in these events, we're facing the same challenges. We're going through the same motions. We're writing the same the same finding round at the same time with the same success rate. I wouldn't say there is a very significant difference at this point that I would point out 10 years ago.

Michael Habib  14:33  
Thank you trying to connect the you know, these comments to the actual realities we are living in, you know, Israel and America and the world, we had very intense and challenging years, starting from the COVID, then later on, the war in Israel, which is still, you know, evolving. And we, I don't think we still, we have reached, you know, going. Back to normal, totally, fully. On the other hand, if you look at the Israeli Medtech performance, Visa V America, the last four or five years have been quite impressive. You know, continued investments, M and A s business collaborations, we can see that the strategic alliance between American the American business community in the Israeli business community across all industries, but including Medtech, is a very strong alliance. How do you explain it? How do you is it only the technology supremacy or the quality of the technology? Is it the people? Is it the needs of the American industry for innovation? Is it a deeper layer of Alliance? How do you explain the strong performance of the Israeli American med tech relationships across the challenges that we are being with that we are facing?

Boaz Lifschitz  15:54  
I would divide the difficult times of COVID and the Israeli wars we have in the last two years, COVID, for some weird and interesting reasons, was actually good for the medical industry, I think mainly because the government institutions understood that we are that there is a lack of technologies in that field, lack of invested in infrastructure, and therefore money was injected, also by governments and by private investors. Very quick after beginning of COVID, took us about four or five, four to six months to recover from the beginning of the shock of the of the of the COVID situation, and actually the two years of two years of COVID were interesting, financially good for the for the industry. I think this was similar to Israel and United States and worldwide, in terms of in terms of the war, obviously, very worrying times in our country, here you saw, you saw, and you are Seeing some kind of interesting, resilient aspect that was me as an Israeli was was a good surprise, and even heart warming, and I and and look at it, I would say, look at it, if you can look at it as we're not post war, but look At as a post war phenomena, people after the shock of the first, first few months, people are thriving, or people have a desire to to create things. And therefore you saw an interesting, interesting phenomena here, as well, of a lot of entrepreneurs, new entrepreneurs, new ideas coming into into the system, but we are still in in difficult times and still in challenging issues. I think they we have, we have a privilege of have good friends in United States who are injecting, giving us support and injecting continuous investments in the industry. So in that respect, it's getting better, but there's a lot to be done and and again, I have a lot of faith in the cooperation of the two countries.

Michael Habib  18:41  
So it seems that the Israeli American med tech Alliance, let's call it for for the sake of this discussion, is strong and prove to be dependable, something that we can depend upon, if you're looking at the future from now on. What do you think I'm asking God? Speaker, what do you think the two industries should do or can do in order to strengthen, further strengthen the ties, the collaboration, to take it to a next level? So, like

Tzvika Barkai  19:12  
was said, I think there is a very good foundation that has been built over the last seven, eight decades on, on weaving the connection and the bi directional collaboration on all levels. It starts from federal governments of both country, and it goes down to a you know, physician, or going mostly doing post doc in hospitals in the US. And everything is weaved already to the point that the collaboration level on, on level, on, on, all aspects are basic, are already there. I think it's will need to grow just, just one example that how it it is related when, when it was COVID time. We were with a collaboration agreement with the NIH International Institute of. Allergy, infectious disease. And the middle of discussion we had in Maryland with the team, they had to go outside to have a discussion with the Ministry of Health of Israel to decide whether to give the second vaccination or the third vaccination in Israel, as it already been used as a like, I said, a better site where the HMOs were acting very quickly. So I believe that this kind of collaboration will only get further deepened, and as technologies are rising, AI and all aspect of technology, I think it will come on the same network and will be stronger and stronger.

Michael Habib  20:38  
Thank you. Ilan, on one hand, American VCs, American corporates, are investing in Israeli Medtech startups continuously. On the other hand, it seems that it's not enough, right? There is still a challenge of accessing capital and partnerships in America, although we are, you know, working very nicely together. Where do you feel there is an obstacle or a challenge in bringing additional or more American investors to invest in Israeli companies, across distances, across the cultural gaps, maybe the acquaintances. Where do you see the challenges as being a non US industry, tapping, you know, tapping on the door of American corporations and investors.

Ilan Uchitel  21:28  
Thank you. So I want to piggyback on Boaz comment beforehand. I don't feel the specific challenge to Israel, because, let's be fair, most of our companies are being funded by us VCs, the challenges are not in the location, the access or the location of the company. There are good times, there are better times, but there are bad times for everybody. Sometimes the challenge is where the money is going within the industry. And I think this is a challenge for all early stage invest, all early stage companies across the board, not necessarily Israeli ones. And we see this with others, other innovators here in this study, the money is flowing towards gradually shifting towards growth from the early stage companies. And here, I would say that actually Israeli has a certain edge. We have a very strong non dilutive innovation grant for this early stage to breathe, this non early stage gap a and it's very helpful. From personal experience, some companies can substantially get closer to the growth stage using this funding. So I would say the gap does exist, but I would say to the other way around.

Michael Habib  22:37  
Great. Thank you. Beatrice, I want to ask you a question that, you know, taking this one step further. On one hand, when it comes to R and D research, early stage, the Israelis know what they are doing. You know, innovation, deep science support from the government. We have all the ecosystem in place, and I think the Americans recognize it, and this is why they are looking at Israeli innovation on the other end, as companies mature and approach, the need to go to the US market. This is where we we need to rely more and more on the US advantages in the US know how and market, know how, etc. Do you feel that the two ecosystems are already mature enough, or, you know, evolved enough to understand each other's advantages weaknesses and find the best way to collaborate, or are we still learning each other? What's your experience?

Beatrice Chemla  23:34  
My experience is that everything starts from human and from people, and from what I see, there is a lot of personal link between Israel people and US people. You have friends, you have family, and we visit each other, and that's create an ecosystem which is personal, but this has a huge impact on the professional way. And this is, this is amazing, because each time you speak to someone in the US, you and you, you say that you're coming from Israel, there's always a link, and there's always someone you know in common. And I think that these strong links then leads to, you know, naturally, to something personal, to something professional. And when you create these kind of links from the personal way to the professional way, then it creates strong things and strong partnership with trust. So I think that these kind of links, which we already have together, allows us to build and to bring the innovation from Israel to reverse market without, of course, we have to adapt. We have to understand more and more the mindset of the market, how to go through this very non simple, I should say, reimbursement pathway, etc, etc. So you will have to do. Do our homework. We have to have all the experts that we need around. But as soon as you have all this kind of good ecosystem that you build, for example, when you come to this kind of conference, then you build the right ecosystem. And then there is the that creates you the right pathway to success. So not easy, but this is the way to go.

Michael Habib  25:26  
Thank you, Boaz. Back to you as a as most of the panel members here are entrepreneurs, you know, managing startups. You are a venture capitalist. You are investing in Israeli companies. I think most of the cases, when you look at American innovation, you know, the American med tech industry, I've been meeting here amazing startups. Or where do you see the inflection point where Israeli investors will start investing in American startups and reverse the flow, meaning, let's starting to merge not only the American business knowledge and the Israeli innovation, but so vice versa, American innovation with Israeli financial expertise and risk taking, even in venture capital activities. Where do you see the future? In this respect, it

Boaz Lifschitz  26:19  
depends in early stage or later stage investments. I think you see already in these days in Israel, we see it in our fund, for example, a tendency to invest in American companies, especially in the more advanced stages. An investor, by nature, is always more comfortable to invest in companies which are geographically near to them because, you know, we want to, we want to go and visit those companies. I want to again, sometimes I give a call to company when I see you today or tomorrow. So by So, by that nature, it's easier to invest in later stage. And I think you see it more and more. You see it more from Israeli funds. And as the market is getting more global in the cooperation beneath the country is getting stronger. I suggest, I suggest, I think that what we will see is more investments coming from Israel into American companies as well.

Michael Habib  27:14  
Thank you. We have less than a minute, so maybe I will give you the floor each of you to to maybe pinpoint one aspect of the American med tech culture that you are exposed to only in your daily dealings with partners, etc, one aspect that you think we should adopt as Israeli Medtech entrepreneurs, something we envy that we don't have at home, that you would like to bring home from here. Twika,

Tzvika Barkai  27:47  
well, the market is here. We need to have better understanding of how the marketing is acting, and we need to do it in more earlier stages where we are focusing on proving our technology. I think the American way is, is is much more focused on, on putting that on the on the first stages. And we need to do that tomorrow. You said we we learn all the time. We learn always.

Michael Habib  28:13  
Beatrice, any thoughts about it.

Beatrice Chemla  28:16  
I think that one, one point of the Israeli ecosystem is that we are more informal. So sometimes it's good because you need this informal way of doing things, to go faster and to be a very agile but sometimes you need more structure. And I think that this is a very good point from the American system to be more formal, to be more structured. And this is something we need to learn to if you want to grow, you need this kind of way of doing things more structured. So this is something I will bring back.

Michael Habib  28:53  
Thank you, Ilan,

Ilan Uchitel  28:54  
thank you. So I would, I wouldn't rephrase what Bob said, but I think to be more specific, growing into a market and how to approach the sales part better grow into it can be very helpful, and it can be it can be taught.

Michael Habib  29:10  
Thank you, boss. Any closing remark on this? What? Yeah,

Boaz Lifschitz  29:14  
really, I think I will answer two different question or say something else. I think we are guests here in the United States at this conference, and I have I'm only thankful of this country, of hosting us and cooperate with us in the industry, and also generally so.

Michael Habib  29:36  
Thank you very much to the panel members. Thank you for the audience, for attending.