Israeli Founders Building a FinTech Venture: Omri Dor, Co-Founder and COO of Obligo (Part 2)

Sramana Mitra: What was the genesis? What was the idea?

Omri Dor: I should mention that ever since I was 20, I would always keep a record of all my ideas. I would try to classify them. I would do due diligence on my own ideas. I did this a lot. Every once in a while when I hit something that is big, I would call whichever friend of mine was knowledgeable and would be a potential co-founder.

It was while I was working for Facebook in London when this thought came to my mind about the rental process, especially how little trust exists between the renter and the landlord. At that point, the examples I had in mind were from renting in London, Tel Aviv. If we take Tel Aviv, we don’t even have a credit rating system. You have no idea who the landlord is. There is no management company. It’s just this person who owns this apartment. They’re interacting directly with you.

There’s very little trust. The atmosphere is very bleak. The landlord is always going to assume that the renter is being shady. The same is true the other way. As a renter, I’m always concerned that the landlord is taking advantage of me. I realized that there was this textbook problem which is known as the Prisoner’s Dilemma.

The most effective strategy for both sides is to take advantage of each other. For the renter, it’s the best strategy to not pay the last month’s rent. What is the landlord going to do? Sue you? As a landlord, why wouldn’t you take the entire deposit amount? What is the renter going to do? Both sides are motivated to take advantage of each other. The way to fix that is to introduce a third party. That trusted third party would change the risk-reward balance so that the best strategy now is to cooperate.

That was the seed of the idea. There were multiple ways to go around it. What if the renter could review the landlord? Maybe I can keep the deposit in Escrow? For any idea that I stumble on, I’m going to call a person who I think is an expert.

I have an older brother. His name is Roey. He was a fighter pilot for the Israeli Air Force and then he went into all kinds of businesses. He was a serial entrepreneur but not necessarily in the tech domain. As soon as he was done with his military service, he and two friends of his went into business. They opened up a bar. They ended up having a couple of bars and restaurants.

Then they wanted to create another business. They went into real estate. They have a very successful real estate company in Tel Aviv. My older brother knew something about real estate. I remember being in the Facebook office in London, picking up the phone and calling my older brother.

Sramana Mitra: That was with the idea in getting him to join you as a co-founder?

Omri Dor: At that time, I wasn’t thinking about him as a potential co-founder. I just wanted to get his feedback. He didn’t get too excited about that idea at that time. Then I went back to Israel and did other things. What happened next was Roey and his partners ended up having an exit with their real estate company.

He was looking for his next thing. We had a family dinner. It’s a weekly occasion in Israel. He said that he was looking to do the next thing and was thinking about doing something in the technology domain. I said, “Do you remember that conversation we had that one time about a real-estate-related business?” I started reminding him about what it was. We were doing the dishes together talking about it. Then we started interacting on a regular basis about it.

Sramana Mitra: It sounds like your brother has some money at this point and you could potentially start this off with your family’s money.

Omri Dor: I wouldn’t say that. We were definitely able to sustain ourselves sufficiently long to work on an idea without a salary. I dropped to part-time in my job. When the real decision came that we were going to work together, I quit my job. Right before we got our seed funding, I was around $30,000 in debt.

Sramana Mitra: There is no risk for engineers to do startups.

Omri Dor: That’s true.

This segment is part 2 in the series : Israeli Founders Building a FinTech Venture: Omri Dor, Co-Founder and COO of Obligo
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