1Mby1M Virtual Accelerator Investor Forum: With Daniel Cohen, General Partner at Viola Ventures (Part 2)

Sramana Mitra: How big is Viola’s current fund?

Daniel Cohen: We have a few funds at Viola. We have a venture fund and a growth fund. Overall, we manage $3 billion, which is a big number for Israel for sure. I focus my time on the venture’s early-stage side. The early-stage side is about $1 billion under management and five funds of $200 million each. 

Sramana Mitra: What check size are you writing?

Daniel Cohen: What hasn’t changed for us is that we are early-stage seed investors, so we invest in Seed, Series A, and Series B. We haven’t changed. Our focus on the area also hasn’t changed.

What did change is the market. Seed used to be $250,000. Series A was $3 million and Series B was $10 million. Now, the seed is $3 million and Series A is $15 million. We still do seed, Series A, and Series B. We try to do a check size of around $1 million on the low end going up to $10 million. That is our main target focus. 

Sramana Mitra: From a sector focus, what is the current thinking? Where is the energy?

Daniel Cohen: We focus mostly on Israel. We try to follow what is interesting in Israel. I would say that there are three core areas for us. One is AI. Everyone is on AI. We try to focus on how AI is disrupting vertical markets. We call it Vertical AI. That is a big scene for us.

We have a big scene around deep tech which is a fancy word for chips and semiconductors. We think Israel is good at online distribution, so it is anything that has a strong element of online distribution. It could be consumerist. Growth hacking is also something that we are looking for because that creates strong growth when it works well.

Sramana Mitra: Great. When investing, what do you want to see? Let’s say at the earliest that you invest in. What do you like to see by way of proof points these days?

Daniel Cohen: It depends on which side of the business we are talking about. It changes dramatically between a deep-tech startup and an online distribution company. I would say that if the team is proven and is known to be strong, then you almost don’t need any proof point.

When a great team comes on board, they can raise money just like that. Everybody starts somewhere right. When it is a first-time team, then we want to see minimal traction in the relevant target market. We should see some consumer or SMB traction in the US.

In enterprise, we want to see one or two bigger customers. On the deep tech side, we want to see a technology road map. We want to see a clear architecture that makes sense for us. 

Sramana Mitra: Your go-to-market strategy is seed, Series A, and Series B in the United States. 

Daniel Cohen: As I said, the companies are all Israeli startups. What is unique about Israel from all the other regions is Israeli startups go after the US market. We do launch in Israel a little bit, but we prefer a US launch right off the bat. 

This segment is part 2 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Daniel Cohen, General Partner at Viola Ventures
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