Post-virus investors ‘need tech that protects world’
Whether in Silicon Valley or Israel’s so-called Silicon Wadi, the coronavirus outbreak will lead investors and innovators to realize that they need to develop technologies capable of protecting humanity, according to one leading Israeli technology investor.
Boasting over two decades of experience in investment management and banking, Benson Oak Ventures managing partner Robert Cohen has witnessed enough crises to forecast what the future likely holds on this occasion.
Unlike the 2001 dot-com bubble burst and the 2008 global financial crisis, which could be tackled with major bailouts and fiscal stimulus programs, emerging from the coronavirus outbreak will require a different approach.
“Everything will be different in terms of how we are going to act and behave, but there will still be start-ups with innovative ideas and funding unlocked for new markets that are being created as we speak,” Cohen told The Jerusalem Post.
“The world, Silicon Valley and start-ups will realize that we need to create things that protect us. I’m very hopeful about the use of technology to solve global problems. We are all in the same boat.”
Much of the discussion surrounding venture investment in recent months, Cohen says, has shifted toward telehealth, biomedical, education and in-home entertainment technologies. There are “always new opportunities” when taking risks and building long-term investments, he added.
Launched in 2018 with partner Yoni Mindel, Benson Oak’s portfolio companies primarily focus on consumer technology, including edtech, fintech and cryptocurrency and technologies for small and medium-sized businesses.
Market interest in educational technology has peaked during the coronavirus outbreak, said Cohen, who played a key role in taking antivirus technology AVG AntiVirus public on the New York Stock Exchange while based in Prague.
“Health and education are two sides of a similar coin. We all know we need it, but can you make money out of it? And do the markets sustain it? The market has now come to it,” said Cohen. “That’s what capitalism is about. Public goods are public goods, but the synergy happens when good for society is combined with being able to make money.”
While Cohen emphasizes that his job is to invest, take risks and make good money, he adds that investing in technologies that can do good for society is “much more rewarding.”
Supporting his forecast that the current crisis will create a new series of markets backed by venture investors, Cohen points to companies including WhatsApp and Slack which emerged following the 2008 crisis. As businesses are increasingly run from home, blockchain and crypto technologies could emerge as the solution to payment issues and greater desire to control personal incomes.
Should Israel and its economy successfully emerge from the coronavirus crisis before other countries, its vibrant start-up ecosystem could take advantage of a head-start in innovation opportunities.
“I think Israeli start-ups are very well-positioned to benefit from the new situation. Startups by definition are nimble and quick. In Israel, even more so,” Cohen said.
“Look at what start-up founders have had to deal with in the past two months – a global pandemic, especially in the key United States market; their entire business now working from home; and an uncertain funding environment. What has impressed me is the company cultures that have been built up here. In start-ups, everyone is pushing forward together and that allows them to band together in the good times and the bad.”