Prosperity in Adversity: Doubling Down on Smart Investments in Uncertain Times | LSI Europe '24

Ido Hadari 00:04
Thank you so much for the introduction and for having us here. I think that the presence of Israel here is thanks to you and your efforts. For a few days, it feels like normal, and it's so important for us and for the ecosystem. So really, thank you. Thank you for joining. I know it's an early hour of the day, but I hope we will make you wake up on the better side. Let's start. What I want to say as an opening is that we are all living in between two poles. The poles are the venture poles, the poles of facts and figures and excels, and the other pole is uncertainty, assumptions, hopes, crystal balls. We are living in between. It doesn't matter if we are founders or VCs; we are looking for the future and hoping for the best. Having turbulent times like we have now adds to this uncertainty, but it also adds other components, and I think we will address most of them. I tried to figure out how many years of experience we have here, and I got to about 120 years of medical experience, innovation experience, and investment experience. So I think we will get a good sense of investing in Israel in these very uncertain times. I'm honored to have all these panelists here today. I'll start by introducing each and asking each so it will be fluent. First of all, Professor Rafi Beyar. Professor Beyar was the dean of the medical faculty at the Technion. He used to be the CEO of Rambam, the largest medical center in the northern part of Israel, one of the largest in Israel. He is also a venture partner at ALIVE VC and, of course, the co-founder of ICI, meeting for the past 25 years. So the first question for you is, as a managing partner at a VC, you probably get calls from co-investors. Once the war started, they probably called you to understand if the investments are safe, should they do something? What is the status of the companies? Visa, video war. Tell us, please, about that.

Prof. Rafi Beyar 02:42
Well, I think that, first of all, it is natural that any investor wants to see how the company is doing. Difficult times may be economic. Difficult times may be other types of social issues, unrest in the region, something like that. We had some calls. But what the VCs want to know is whether the companies that are already in the portfolio are well-funded to go through these difficult times. How do they deal with the stuff that, part of it may be drafted, and they have to overcome these difficulties over time? We just supply them with facts. I mean, the fact is simple; there are the word difficult. They say, well, let's say almost 10 to 20% of the workers were drafted in some companies, but after some time, the commitment of everybody else to fill in for those who are missing, the commitment of the company to continue its task under the entire condition is what makes it a great success. We see companies like that, even in these difficult times, are successful in moving quickly towards their goals. Because we see this is our strength. Our strength is the ability to work under difficult times. This is true for the companies. This is true for ICI also. We went through cycles of difficult times, and we are there for 29 years, not 25 years. So, I think that the secret is commitment, great management, and people who can actually do jobs and sometimes fill in for somebody missing. I think this, in all cases, our LPs were satisfied with the situation as it is, obviously not satisfied with the situation that happens in general, but with the ability of the companies to be resilient in these difficult times and show resilience.

Ido Hadari 05:15
That's good. Thank you. Going to Assaf. Assaf Barnea is the managing partner of Sanara Capital and Sanara Ventures, and he is also the chairman of the Life Science Board of the Israeli Export Institute, which I am honored to be a member of. Assaf, you have in Sanara very early-stage companies. Do you think, or can you share with us how they changed the talk with investors, potential investors, and previous investors once the war started?

Assaf Barnea 05:52
Basically, I think that the ecosystem in Israel is definitely suffering. There's no doubt, as Rafi just mentioned, we have to look into reality as it is and acknowledge the issues. There are some big issues over there on one side. You know, as VCs, for us, this could be, to some extent, even an opportunity in the sense that valuations are going down globally and locally as well. So that basically is a filtering process, if you will, that brings in the better companies to a better situation, if they can make it. Now, this is the big question: can they make it? Going through those difficult times, mainly the various issues could be on the operational side, on the funding side, on the HR side. For instance, we had some of our CEOs drafted, as Rafi mentioned, one of whom was a CEO that went down to Gaza in the first few months of the war in a special rescue unit. Someone else took the position and assumed that role. So that creates, within the company, different opportunities for people to step up. But I think for us, the way they talk and the way we guide them to go through that is in those various challenges. On one side, we are considering flipping several companies to become US-based companies. That's an option. This way, you can maintain the R&D in Israel while having a headquarters in the US parallel to the one running in Israel. Funding-wise, we've been talking to the companies and to the ecosystem, and one of the things that we are now initiating, also as part of the Export Institute in Israel, is to try and talk to more strategic investors, not just VCs, but rather open up to those who are not necessarily active in Israel but do come to Israel every now and then, every few years, and are looking for those amazing technologies. There are amazing opportunities now, but there should be a more structured mechanism for those companies of ours, whether it's Sanara or elsewhere, to be able to talk to strategic investors. I call them second-tier strategic investors. Once they see a synergistic technology, a complementary technology, and hopefully fall in love with that technology, the investment will come. So I think breaking down a big issue, a big problem into small problems is one thing that we are trying to work with our portfolio companies on: what is the bottleneck at the moment? In most cases, this obviously might be funding. For sure, funding might be an issue. And on the other hand, anything that has to do with operations, I think, being focused on one side and having the resilience, which we do have, anyhow, is true. There is amazing resilience within the Israeli companies, and something that you combine with the practical operational issues of what's the focus, what's the next step, the clinical stage, the funding stage. This is something that is beyond the day-to-day.

Ido Hadari 08:47
Thank you. Thank you for that. Daniel, going over to you. Daniel Allen heads the healthcare vertical for Unorthodox Ventures. Daniel has a PhD in immunology and gene therapy. What I wanted to ask you is about the stereo vision that you have being a US VC. The headquarters is in Texas, and you, as the representative in Israel, being an American-Israeli man, how do you find there is a gap between how Israel, the ecosystem, is perceived in the US, the risk in investing, versus the entrepreneurial spirit that we have here? So how is it perceived in the US versus how do you feel it in Israel?

Daniel Allen 09:39
Absolutely. So just for some context, I live in Israel. I got linked up with Unorthodox Ventures while already based out of Israel. But Unorthodox Ventures is not an idealistic investor in Israel. It's an opportunity that our founder, Carrie, saw in the entrepreneurial spirit of the Israeli people, of the Israeli ecosystem, and that drew him to want to invest in Israeli tech. So as far as how that has shifted, I think he sees it as an opportunity. We see it as an opportunity that hasn't really changed in the stats and the data throughout the difficult period before the war and through the war. Now we've seen very consistent investment from foreign entities. It hasn't really gone up, like one would hope to see, but it's really stayed quite consistent. We hear this from other investors; maybe Rafi and Assaf, you guys can speak to this with LPs coming from outside the country. But we've heard from people raising funds in Israel that LPs outside of the country that have already invested in Israel in the past are more likely to stay right now. Attracting new LPs from outside the country is a little bit more of a challenge. But people who have already familiarized themselves with the Israeli ecosystem, have already traveled to Israel, and understand the reality on the ground are more likely to continue to view it as an innovation nation, as a startup nation, as a place where new innovation will come. Just like throughout the rest of the world, we've seen a dip in new company formation. I think that's a reality in the current economy that everyone is dealing with. Israel may be more poignantly affected, but that's something we hope will pick back up as the economy kind of thaws and recovers. But again, as opportunistic investors from outside Israel, we see new innovation, the same resiliency of the people, of the founders. Maybe even more, as you go through a crucible, you can fine-tune those skills and really optimize output on the other side. So as far as commitment to Israel, we still see it as an opportunity. We still see it as a place where a lot of innovation comes out of, and that hasn't changed.

Ido Hadari 11:59
Thank you. Now going to Sharon. Sharon Handelman-Gotlib and I work together for one of the largest, globally largest providers and payers in Israel. So we know each other for many years. Sharon is the co-founder and CEO of Shela. It's a precision medicine digital health parental app or technology. Sharon is very active in the femtech ecosystem in Israel. What I want to ask you is, we heard the investor side; now we can hear the startup side. When you were talking to investors, when you were trying to raise funds, what is your perspective on that?

Sharon Handelman-Gotlib 12:44
Sure, so I'm hearing the investors and from really the founder and the company's perspective. I'd say there's always generally this tension between the long-term vision that we want to see and to show how we move innovation forward and then how we do the de-risking in specific areas. Here in the crisis, I'd say it's just amplified. So managing the tension is what the investors from my side wanted to see in the beginning, at least, of this situation and these challenging times. Unfortunately, I'll say that maternal health is a huge space picking up, and I didn't see any kind of slowness of people reaching out to me or approaching me from an investor perspective; the deal flow continues on. The momentum is still moving forward. Yes, they want to see more proof points, more validation here that we have a clear strategy, a clear plan in place. Once you have that, and again, Assaf and Rafi spoke of this resilience, once we're able to present that, and I present Shela's strategy, success stories, accomplishments, achievements, etc., it gives the reassurance that is needed and says, "Okay, we'll move on. Let's continue that." So I'd say that there is higher uncertainty, for sure. You cannot dismiss that or ignore that. But with the technology that we bring, with the strength, with our capabilities, we are successful. You said, "Okay, it's an opportunity. Why not seize this opportunity?" So I think things are doing okay. I'm not saying great; I'm saying there is room for improvement, for sure, but we're in a good place.

Ido Hadari 14:36
Thank you. And just as a note about what Assaf said and Daniel said, Assaf was talking about CEOs that replaced each other or supported each other. We have here Gal Neyman with us. She founded Wartime CEO, a nonprofit organization that started mutual support between startups in Israel and between startups and investors, making it happen, making it run smoother and with less bureaucracy and fewer hurdles on the way. I think that even if you didn't get the support you wanted, the feeling that you have someone behind you and the feeling that you are not alone was very important during the first month of the war and is still now. Going to what Daniel said about getting to know Israel, if an LP has already invested, it will be easier for him to invest than a new one. So Scott, back to your visit to Israel in February. I think that you can testify that after being in Israel and not seeing it via what you see on TV, it's a totally different perspective, and you get to understand that we are standing on our legs and we are stable, and this ecosystem continues to generate great things. So if some of you haven't been to Israel, you are more than welcome. You will find it very hard to have a room in one of the coffee shops; everything is fully booked, especially in the big cities. So it's not a war feeling in the big cities in Israel, of course, just in the north and in the south part, but the central parts are live and kicking. I'm not representing the Ministry of Tourism, but you are welcome. So let's go back to another round of questions so we can use our time best. Assaf, going back to you, the companies of Sanara, did they have you talked a little bit about it, but coping not with investments, coping with the atmosphere, having people drafted, having people whose spouses were drafted, or even like someone from the family got hurt from the war? Say a few words about that.

Assaf Barnea 17:15
As you rightfully mentioned, this is complicated. It is complicated. It is complicated. So we've been talking about the opportunity on one side, and by the way, not to be a kind of a shock we see saying it's an opportunity for us because valuations are going down. But think of the opportunity truly in terms of emergency medicine. Think of it; we're all going to be amazed by how many companies will emerge out of this war with emergency-related technologies coming out. Some of our CEOs are practicing physicians, some of whom are running companies. This will be tremendous. This will be something that I'm truly excited to see within the next two years. But regardless of that being an opportunity, which is hard to see in these days, the issues of human capital are something that I would put the emphasis on because sometimes you cannot identify, and as investors, as board members, as chairmen, you should be able to acknowledge and see whether it's a trauma that you can immediately recognize or something within the functioning of a company, something that is missing, something that KPIs are not being followed as properly because someone else is busy with justified issues. For sure, one of our companies, in terms of risk mitigation, went down to India and did some clinical studies in India for that matter in order not to stop the process. So that forces us, all of us, including within the companies themselves, to be creative enough and to think of ways, basically out of the box, which Israel is all good at—out-of-the-box thinking—how we maintain that flexibility on one side but not being deterred or afraid to really make shortcuts that are needed. I'm not saying anything that has to do with regulation or the regular process of the clinical evidence that are needed. I'm saying just to come up with practical solutions, some of which I can share with a few of our companies, you know, flying to different conferences, identifying in advance things that were not necessarily on their agenda, and now we put them, we bring them forward and say, you know, we cannot wait till November. We cannot wait till... So I think in that sense, somehow that resilience has the foundations of flexibility and resilience and thinking out of the box, all of that on the human capital, which they have. Our part as investors, as board members, is to make sure that if two or three people are missing out of 15 in a company of 15 people, it is our responsibility to mitigate that and see, you know, can we support that? Can we sit more on the financing side, on the operational side, or on the clinical side, and be supported by others, by experts, by founders, by referring one another to expertise, which typically we do not do, whether locally or globally. Those are the mechanisms, by the way, that we're trying to create. You are aware that we've been working on them together to have more knowledge sharing, a more structured knowledge sharing between us within the Israeli ecosystem in order to be able to pass on and move on from these difficult times with as little damage as possible.

Ido Hadari 20:30
Thank you. And Sharon, going back to you, your company, your staff, how were you affected directly by the war?

Sharon Handelman-Gotlib 20:40
Well, we had a disruption. We can't ignore the fact it was disruptive. I'd say that everybody was affected by that on a personal and professional level, on a physical and also on a mental kind of well-being. Two of my co-founders coming up from the north were evacuated at the beginning of the war. I had to deal with my chief medical officer, who had to take all the high-risk pregnancy units and delivery rooms underground and transfer all that. That was a major project for the first week or so. So it's kind of shifting and playing around with the situation and whatever it is. But the focus is again, focus, focus, where are the key milestones? What can we not derail, and what can we just put aside? That's one. The second point, which was very important for me, was making sure and maintaining the well-being and mental health of everybody, ensuring that everybody is okay, helping out where possible. So that's something that for me as a CEO was very important to ensure. I also gathered the management team on October 8, the day after, saying, "Listen, specifically, we had a very important week. Every day, and every week, of course, is important, but significant milestones, significant meetings." I said to them, "Listen, we are staying the course again, this resilient notion that we spoke about. If you can't physically or emotionally join the meeting, it's okay. We'll manage." That's how we maintained, kind of day by day, staying the course, ensuring that we have our focus on where we should. That's how it went, and we went on to achieve success, as I said before. So success after good things, some ups, some downs, of course, but that's just the roller coaster of a startup. I'll also say that from my personal perspective, seeing as Assaf alluded to that as well, is supporting one of my closest friends, the CEO, who got drafted, as well as his entire team. I picked up the phone when I was able to reach out to him between things that he was doing, and he said, "Listen, I'm here for you. Tell me what to do." I took upon myself the marketing and investor relations and managing his company. At a specific point in time, I was managing two companies just because I knew that there is solidarity, and it's just enough. You have to do that. It wasn't even a question. He's like, "What are you doing? Don't you have things to deal with?" Of course, I have, but you are my friend, and I won't see your company going down the drain because of uncertainty. He's back; everything's good. The company even raised a lot of money.

Ido Hadari 23:41
Was it Sensei? That's the company, correct? So you called me as well.

Sharon Handelman-Gotlib 23:47
I asked everybody in my network to help them, including also Gal. I'd say that's, again, also the feeling. Yes, uncertainty, times, crazy things are going on around us, but we know how to manage them, and we know how to manage them very well, and I think, in a positive way, that gives everybody the sense of, it's not a sense of urgency; it's a sense of purpose. We know why we're here, especially in health. We have a mission. We are staying the course. That's kind of where I took it.

Ido Hadari 24:22
That's great. I have a few more questions, and I promise Scott that I'll only take one hour more than the scheduled time. Don't worry, Professor Beyar, I want to be very optimistic and take the opportunity to talk about Innoval. Innoval was acquired by Edwards only a month ago or two months ago. Can you talk about the process? Was it affected by the war? How, when did the talks with Edwards start since the war began?

Prof. Rafi Beyar 24:56
Well, I think that, first of all, we invested in Innoval four years ago. This was our first investment, and it was relatively, I wouldn't say, you know, the valve had already shown its promise in animal studies; the delivery system was not ready yet, but we believed in the team. We believed in the technology. We saw the need. We felt the huge competition that there is in the market in the mitral valve area. This was a decision we took, and the company went through the milestones regularly. The thing that we saw is that the first patient was not a great success. That's also something to learn from; the first patient died, but not because of the procedure, because of bleeding. When a first patient that you do dies, it's a major issue. You start to think whether this company is going to survive. This was way before the times of today, but still, they continued. They did the next cases. They overcame a little technical problem that they had at the beginning, and they were able to then go according to the milestones, get to the first in-man, do it successfully, go to the US EFS study very successfully, and they had a deal with Edwards, a build-to-buy type of deal with milestones. If they achieved the milestones, Edwards would have time to decide. They were able to achieve the milestones, and it turned out that this valve, the Innoval valve, tends to be a very good one. It doesn't obstruct the outflow tract. It is a relatively easy procedure, 40 minutes, skin to skin. The doctors loved it. There was no harm to the outflow tract, which many valves have of the left ventricle causing stenosis because it catches on the valve itself and not on the annulus, which is a big one. It was a small profile. It actually increased the function of the left ventricle, whereas other valves decreased the function of the left ventricle. There was a lot of great data, and that's the important thing. You have to present data. The people for Edwards told me when they looked at the data, this is the cleanest data that we have seen in my entire life for a first in-man study. I think this is what brought it to success. It was in the middle of the war; as you know, people were drafted, but the team was dedicated. They had a case in Minneapolis. They flew over there. There was always a team that could fly and do this and be on schedule, being on schedule, and even ahead of schedule, making sure that everything goes right, that there is no other fault that actually brought the final success. The success was even during the difficult times. It was acquired after October 7. It was during the last two months, despite all this turmoil, when they see that everything is done right. They came and visited the company, saw how the production is done, how all the processes are done in place, met the team, and got full confidence in the team. As you know, Edwards also has a laser center; there is also a research center in Israel. So there's another thing. Yes, there is a war, although there were problems with flights, and the airport being closed, they couldn't fly in. But still, despite all of this, meeting the milestones, being sure that everything is done right, they continue to do so. The next study will continue to be based on the company in Israel, production and everything. That really shows how if you go to the milestones, if you believe in the team, and if you have a good product and good results, then you can go through difficult times.

Ido Hadari 29:52
That's great stuff. Assaf Barnea 29:54
Going back to what Professor Beyar just mentioned, I'm using this part for the LSI platform to call upon our friends and colleagues in the venture community globally. In most cases, also the strategic ones, in cases where you find disruptive technologies, I want to share two examples that we've been investing in while the war took place. One of our companies called Nanodrops aims to replace lenses and glasses. We had a strategic investment from one of the more significant players co-investing with us. Same goes for two weeks ago; we invested in a company called DisQ alongside Supernova from Paris and World Capital from California. So when you guys, corporate VCs or VCs, identify an opportunity in Israel, do talk to us, the local communities, because in most cases, other strategics or VCs would like to have a local partner, a local venture team on the ground in Israel, exactly to mitigate those issues. We can help you not to pass on opportunities but rather to embrace them, using us for co-investment, for managing the company in those days. This is something that we need to convey, a clear message, that we are here to stay. We're here to support you guys and not to miss opportunities that you find attractive. Thank you.

Ido Hadari 31:08
Very important. Daniel, going back to you, we didn't speak; we touched on it, but I want to be very specific, talking about the Israeli entrepreneur, the guy that goes to the army at the age of 18, goes to college only at the age of 22 or 25. How do you find the Israeli entrepreneur different from entrepreneurs in other parts of the world?

Daniel Allen 31:34
Yeah, I mean, I'll speak specifically about the Israeli entrepreneur. Obviously, there are great entrepreneurs everywhere, but specifically something that we see, maybe disproportionately in Israel, is the process of going straight from high school to the army and sometimes getting thrown into a role where you might have five to ten people under you. At age 18, you might have 30 people under you. By the age of 19, you might be an officer running a project. By 20, you might have 100 people under you by the age of 21. It scales up very quickly. In the American army, it's a little bit different. The officers might come in from officer school; in Israel, everyone comes from the bottom up. I think there's a management, a project management skill that people learn at a very young age, obviously depending on the unit, that is critical to then maybe spin out a company from the army. Maybe, you know, go to university and then create a company after that. I think those skills are ingrained at quite a young age. Additionally, I think there's an atmosphere in Israel, maybe partially brought on by the constant existential threats. You know, tomorrow's not promised. That's definitely a mentality that undergirds everything in the country. Everyone knows someone who's exited a company. The joke is that everyone's cousin has exited a company by 20, and everyone's uncle by 25. So there's a concept of, "Why not me? Why can't I go out and raise $100 million and sell a company for half a billion dollars in my early 20s and then become an angel investor and be a billionaire by 28?" So there's a mentality of "Why not me? I can go do my own thing. I don't need to work some cushy corporate job in order to eventually do something." It's kind of an act now, tomorrow's not promised attitude. That attitude sometimes has to get checked. That attitude can sometimes lead to hubris and arrogance, especially in the medical space, where your market is the United States, and you need to know that market. There are definitely Israeli entrepreneurs that need that ingrained in them from the early days, even pre-clinical studies, that if your market is the United States, you need to know that market backwards and forwards. If you don't know the regulatory risks, you don't know the commercialization risks, the reimbursement risks of the United States system, which is unbelievably complex and completely different from the Israeli system, then those can be stumbling blocks down the road. That's something we try to really help with and try to parse out in the early days of our diligence with the entrepreneur, with the CEO, to try to identify those risks or those potholes and try to help them where we can.

Ido Hadari 34:23
Yeah, I totally agree. When the war started, I published an article in the Jerusalem Post saying that the Israeli entrepreneur at the age of 22 has already led some people. He has already found a lot of courage, and he understands that he needs to work fast. He needs to take decisions in a very uncertain atmosphere. The way to bring technologies from the civil arena to the military and back works also. ALIVE invested in one company; I was part of ALIVE also, and I'm very proud. We invested in Innoval, but also in Bionics. It's something that was spun off from the helmet of the F-35. Things are happening in a good way, of course, and I think that the Israeli entrepreneur is different for a good reason; something is different about this ecosystem, and I think it starts with that.

Daniel Allen 35:23
If I can just add, you see this in the United States as well, the disproportionate percentage of entrepreneurs coming out of the Navy SEALs, for example. You see that there as well. In a country where everyone's obligated to draft, some go into intelligence, some go into special operations, some go into combat. It's just kind of a funnel, again, kind of a crucible that people go through at a very young, impressionable age. I think that definitely plays into it later on.

Ido Hadari 35:52
Good to know. In Israel, there is Startup Nation Central. It's an NGO that brings together all this ecosystem, and they just published, a week ago, a very good survey. I'll give you some data from that. There are over 7,000 companies active now in Israel, not just in the medical field, but 7,000. There were over 200 investors that invested at least one time since the beginning of 2024. Private funding rose for the first time since the second half of 2021, so three years, and it reached 5.1 billion across 32 rounds of investments and M&A exits like the one of Innoval, with four at 4.1 billion from 29 deals. Again, it's the highest since 2021, so it looks like, in some way, the ecosystem is getting back on track. The numbers are getting higher again. Hopefully, these numbers will continue rising. Just as we have a closing argument, I want to ask all of you, and try to be brief. Let's say that the war ends today, okay, and peace comes to the region and everything. What do you think will happen in the first two months and the first year after the war ends? Let's do it that way. Daniel?

Daniel Allen 37:38
Everyone will celebrate. It'll be amazing. There'll be a little bit of shock, and they'll, you know, but obviously, that's what we're all hoping for. I think there will be a tremendous amount of exchange of capital in and out of Israel. We saw after the Abraham Accords, the first week of the announcement, I think there were 25 full flights of Israelis flying to the UAE, and there were businesses set up already in the UAE. I think that's just a small example. I think that'll open the floodgates to the exchange of travel, of capital, of knowledge, both within the region and across the Atlantic.

Assaf Barnea 38:19
I say first, this too shall pass. We'll see better days coming very soon. That's one; we're optimistic. A new wave of investors will come in, and we'll see the shift coming in with new companies emerging, new ideas. Again, this interchange between companies and countries will come, and we'll see some very strong technology, especially in health, mental health. It's not only emergency; mental, cyber, and other categories and domains will see those all kind of booming out of Israel, with new energy flowing out of that. It would be a cool era, a new chrome era.

Prof. Rafi Beyar 39:03
Hopefully so.

Assaf Barnea 39:04
Just going back to that, you know, during COVID days, we were the first to use the vaccination. It was a huge test bed for the COVID vaccination. I think, unfortunately, very unfortunately, but due to that, anything that has to do with post-trauma, mental health, and emergency medicine will be booming. There will be another layer of innovation coming out of that, including unparalleled data that you can think of. I'm saying it with tears in my eyes, but that's the way it is. Nonetheless, as mentioned before, I think that will result eventually in hundreds of new companies that will start using that data, understanding where we are, and hopefully bring it globally to a better place.

Ido Hadari 39:57
I think that we have to remember that in Israel, it's the second war that we are going to end. The first one was the COVID war. It was a two-year war. There were lots of casualties there, as we all know, difficult types of casualties. But it was a challenge for the high-tech industry in itself. Digital health was booming, then they crashed a little bit. The world is changing, but there is no question in my mind that the entrepreneurial spirit will continue and may even be enhanced. Once things settle down, there will be more investment and ideas, very early ideas that today are very difficult for them to get funding will be able to get funding. So we'll see more things happening. The major issue, the major limiting issue today is not the manpower, is not the flights, is the funding that needs to come to the early-stage companies and even send them to the later stage. So around VC, where you need to go, that's where the challenge is in Israel today. Obviously, when it opens up after things settle down, this will create a new era of innovation.

Ido Hadari 41:21
Hopefully. Before wrapping up, the first prime minister of Israel, David Ben-Gurion, said that in Israel, if you want to be realistic, you have to believe in miracles. I hope it will not be a miracle, and this war will be over very soon, and all that you said will happen. I share the same optimism, and I think we are on good and stable ground, and we will prevail, and the med tech will get back. As Scott said, I think that the Israeli part in the global ecosystem of innovation is so important and central; we must go back. We don't have any other choice. I want to thank Scott for having us on this panel and on this conference, and I want to thank all of you and the panelists, of course, Daniel Allen, Sharon Handelman-Gotlib, Assaf Barnea, Professor Rafi Beyar. Thank you so much, and have a great day. Bye.