“The real goal of a startup is to build something once and sell it over and over again.” | C Tech

As part of Calcalist and Poalim Tech’s Growth+ project, Ofir Ehrlich, co-founder and CEO of Eon, spoke with Chen Markman, CEO of Avon AI, which develops a platform for managing and controlling AI agents in sensitive organizations.

The conversation was held as part of Calcalist and Poarim Tech’s “Growth+” project, now in its third year, a series of one-on-one meetings between founders of major Israeli technology companies and entrepreneurs of promising startups. Our goal is to provide advice, support, and practical tools on entrepreneurship, creativity, startup management, and building companies for growth.

Ofir, tell us about any early crises or challenges you encountered and what you learned from them that helped you start your entrepreneurial journey.

“The worst advice I received at the beginning of my entrepreneurial journey was, ‘Build a big business and the money will come.’ The question is: what is ‘big’, who defines it, and who measures me?” The answer is that you should always understand how you will be evaluated in the next step and guide your goals accordingly.

“First-time entrepreneurs often think the goal is to bring in every possible customer. But the investors who are expected to provide their next round of funding are interested in building a repeatable sales mechanism. Once you know how to sell, you need to know how to reproduce it. At my previous company, I made this mistake and didn’t emphasize it early enough. We came to investors and said, ‘We have great customers,’ but the real goal of a startup is to build something once and sell it over and over again.

“Another mistake has to do with customer selection. In one of my early companies, we sold to Israeli companies like Zapp, Walla, and Nana. When we approached American investors, they told us, ‘We don’t know these companies. Your customer base is not important to us.’ The bottom line is that you have to bring in people who are strongly business-oriented from the beginning.”

Chen, what is the biggest challenge you have faced this year?

“Selling to a large company as a small startup. This is a long and complex process, and trust is a key factor. Large companies that want to implement a product at a core, sensitive level prefer to buy from companies that they think will still be around in 10 years, meaning they won’t be sold or change direction unexpectedly.

“This challenge, and our ambition to sell internationally, is what we are most focused on right now.”

Ofir, what advice did you give Chen?

“I advised him to focus on the next milestone, usually the next round of funding, and work backwards from how investors value the company. It’s important to look at ‘metadata’ such as who the investors are, what markets they’re targeting and how much runway they have left. These factors are just as important as the technology itself.

“We also discussed the need to clearly articulate why your business will remain differentiated, not just today and tomorrow, but two to three years from now. In such a fast-moving environment, this is a huge challenge. That’s why you need to build a deep, wide, and defensible moat that will be very difficult for competitors to cross.”