Is it better to start a company when you are young and energetic, or older with more wisdom and experience? For four Israeli founders of large start-ups, the answer is clearly the latter.
Chen Amit had a long entrepreneurial career before he founded Tipalti, a payment automation start-up valued at more than $2 billion, in 2010 at age 45. Prior to Tipalti, Chen served as CEO of Ethernet company Atrica and co-founder and CEO of Verix, and a leading executive at ECI Telecom before those. But, he says, his current venture is the most enjoyable.
“When I was younger, without experience, the process of creating a company felt very hard,” Amit says. “Now, I’m managing a much more complex company, and it is much easier. The general rule is that experience matters. The statistics show that success rates are much greater for founders later in their careers.
“As an older founder, it is easier to make bolder decisions and to act strongly with my investors. When I was younger, I made some critical mistakes when selecting investors that affected the company in major ways. Tipalti is my most successful venture, and also my easiest.”
Today, Tipalti has some 1,400 customers and processes more than $20b. in transactions every year. The company recently raised $150 million, is doubling revenues each year and has a customer churn of just 1% a year, “the best customer retention rate on the planet,” Amit boasts.
Amit says that Israel’s tech ecosystem is a great place to start an early-stage company, with lots of funding and great talent available. “Investors worldwide understand the level of value, creativity and success coming out of Israel, so there is plenty of interest and resources available,” he explained.
Chemi Katz, co-founder of Namogoo, had a similar experience. The customer-journey optimization company he co-founded at age 42 has more than 130 employees in Israel and the United States, works with large retail clients like JC Penney, Marks and Spencer, Lenovo and others, and has raised $69m. from investors.
“Before Namogoo, I worked in the technology business for 20 years, and managed large teams in many different roles,” Katz says. “Having that experience and maturity was key for building this team, raising money, and developing our strategy.”
Katz had savings from a previous venture he sold, so taking a low salary while he built Namogoo from the ground up wasn’t a challenge for his family. “The real challenge was raising small kids while building the company,” he says. “During the first few years, I needed to travel a lot to visit our big clients, to the point where I was alternating weeks in Israel and abroad. But there are challenges at every age. The advantage to building a company at this age is the experience you bring from other companies.”
Eli Israelov, age 52, co-founded CommBox, an omnichannel communication and customer relationship platform, in 2013, after a career as an entrepreneur. The idea for his current venture came when he found at his previous position that it was becoming too complicated to interact with customers on so many different channels.
“When you get older, you know the game better, and you know yourself better,” Israelov said. “You have more self-confidence, and you are in a better financial position.”
“At my previous start-up, I was too excited and not smart enough, and I didn’t know the who, where, what of what was needed. This time, I knew what research I had to do and what my needs are. I started the company without taking any outside investment because I was confident that I knew what it needed. That risk was calculated based on my experience, and worked out well.”
49-year old Eilon Reshef, co-founder and chief product officer of Gong.io, which develops sales intelligence solutions to maximize revenues, had a similar experience. “I had founded another company when I was 27, and this one is much easier to run,” he says. “It is much easier at this age to use your experience to filter through different ideas, and your connections provide amble access to different funds and investors.”
Gong.io has raised more than $300m., and is valued at more than $2b. The company has more than 2,000 customers, including some of the largest tech companies in the world, and has more than doubled in the past few years.
“In my first venture, I made lots of mistakes,” Reshef says. “We try not to make the same mistakes a second time. It is important at this age that you relax and enjoy the process more. We don’t work 12 or 16 hours a day like many younger founders do. We allow things to go at a slower pace, letting ideas incubate and managing our time more effectively.”
“At this stage in the game, if you aren’t enjoying the process, you probably aren’t doing it right,” Reshef says, and adds with a smile, “I’d recommend everyone start with their second venture.”