Finding the right team is critical for a startup's success and most aren't taking the right approach, finds research from the University of Maryland's Robert H. Smith School of Business conducted in collaboration with researchers from the Technion-Israel Institute of Technology.

Follow Israel Hayom on Facebook and Twitter

With the right strategy – a mix that has founders both liking each other due to shared values and experiences and having the proper complementary skills and capabilities – startups can foster better team dynamics and have more success raising funds, being productive, and earning profits, the researchers found.

Maryland Smith professors Rajshree Agarwal, Gilad Chen and Brent Goldfarb collaborated on the study, published under the title "Forming Entrepreneurial Teams: Mixing Business and Friendship to Create Transactive Memory Systems for Enhanced Success" in the Academy of Management Journal, with co-authors Moran Lazar and Miriam Erez of the Technion and Ella Miron-Spektor of INSEAD.

The findings also are summarized via whiteboard animation: "What's the Best Way to Build a Startup Team?"

The research team, which Chen assembled using the approach the research prescribes, looked at how startup founders form teams and how their formation strategy affects the new venture. "Formation strategy is important for building strong transactive memory systems – the combined knowledge within the team of who knows what and how the team uses this shared knowledge to efficiently and effectively solve problems and make decisions," Agarwal says.

"New venture teams are really the whole entity of an organization in its infancy," Chen says.

There are basically two ways co-founders find each other, say the researchers. The first is all about interpersonal bonds created through prior experiences – perhaps college friends, former colleagues, or family members. The second is by seeking out people who have the capabilities and competencies needed.

A hybrid formation strategy works best, Goldfarb says, but few startups – about 1 in 10 – actually use it. That's likely because it is more difficult.

"To get the team with that perfect combination of having both the resources and the right mindset, and the right level of comfort that you share with each other, that's hard to do," Agarwal says. "Creating teams requires intentional thought and attention to these two things. It's going to be hard, and it's going to be rare, but if you do it, there are huge performance benefits."

In one study, the researchers looked at new technology startups on the crowdfunding platform Kickstarter and coded whether co-founders selected each other based on interpersonal attraction, resource-seeking, or both.

"We were able to link these strategies to the amount of funding they actually raised," says Chen. "A minority of those teams – about 10% to 15% – engaged in the hybrid team formation, but there was a huge dollar-value premium for those teams."

So why is the hybrid approach to team building so much more successful?

"Founding teams have a lot of key decisions to make and they need to swiftly come to agreement on the best alternative among many options," says Agarwal. "Each member is important not because they are just dividing and conquering all of these tasks, but also because they're brainstorming and problem-solving on what should be the right solution. For that, team members need complementary skills, but they also need to trust in each other."

The researchers ran another field study with an entrepreneurship competition and incubator program at Technion in Israel. Founders were asked to describe how they formed their teams as part of the application process. "We were able to show that hybrid teams were more successful, and we were also able to verify that it was the transactive memory system – that ability to really understand who knows what and integrate that differential knowledge better as a team – that explained why hybrid teams succeeded," Goldfarb says.

A third study was conducted at Maryland Smith in a series of entrepreneurship courses developed by Goldfarb in Smith's undergraduate and online MBA programs. The researchers experimentally seeded teams according to the different strategies, then followed them as they developed real businesses and raised funding throughout the class. Again, they found that the hybrid teams fared best because of stronger transactive memory systems.

"The chemistry is just as important as the capabilities," Agarwal says. "Ignoring one or the other will lead to fault lines later in the team's transactive memory systems."

Still, there's hope for new ventures that don't initially take the hybrid approach. As they bring on new team members, these startups should balance their initial strategy by using the other one. "It is an iterative process," says Chen.

The findings can also extend beyond startups to any organizational team, say the researchers. While the study deliberately focused on the embryonic phases of an organization with startup teams, the results apply in other contexts too.

In fact, as Agarwal, Goldfarb and Chen all noted, their own author team dynamics benefited from the hybrid approach.

Subscribe to Israel Hayom's daily newsletter and never miss our top stories!

The post Study sniffs out surprising secret to startup success appeared first on www.israelhayom.com.

Bereaved families protested outside the King David Hotel in Jerusalem Sunday during a cabinet meeting that was attended by German Chancellor Angela Merkel.

The protest was organized by the Im Tirztu right-wing watchdog group and other organizations that work with bereaved families. Demonstrators claimed that over the past last decade alone, Germany has transferred 84 million shekels ($26 million) to propaganda organizations that are hostile to Israel and provide legal assistance to Palestinian terrorists.

Follow Israel Hayom on Facebook and Twitter

According to data collected by the watchdog, the German government had directly and indirectly funded about 34 propaganda organizations that have extreme left-wing views, including an organization that promotes refusal by Israeli youngsters to get drafted into the IDF.

In a letter to Merkel, heads of Im Tirztu and other forums wrote, "As you must know, the German government transfers directly (via the German Foreign Ministry) and indirectly (through government foundations) hundreds of thousands, sometimes even millions, of euros each year to Israeli political organizations affiliated with the extreme Left."

It stressed that German funds were used to fund organizations that support the anti-Israel boycott, divestment and sanctions movement, which work to encourage international pressure on Israel, attempt to change its immigration policy and even try to change Israel's policy of war on terror "through legal proceedings and international pressure."

"The government funding that Germany transfers to political organizations in Israel is a despicable and anti-democratic political subversion. It is a waste of the German taxpayer's money," the letter said .

Subscribe to Israel Hayom's daily newsletter and never miss our top stories!

The post Bereaved families protest 'German funding of terrorism' appeared first on www.israelhayom.com.

With Europe in coronavirus lockdown, venture capital fund manager Fergal Mullen told his investors in April he would find it hard to back a startup without first meeting its founders.

A couple of months later, the Geneva-based co-founder and partner of Highland Europe broke his own promise and invested in Meditopia, a mindfulness app with teams in Berlin and Istanbul that he got to know over some 40 calls on video app Zoom.

Follow Israel Hayom on Facebook and Twitter

"I had to eat my hat," said Mullen, looking back on a year of deal making that, after a sudden stop in the spring, came back to life in late summer and has gathered pace since.

Highland Europe has just raised 700 million euros ($850 million) for a fourth fund, its largest, and is preparing for the sale or flotation of around 10 of its portfolio companies next year.

And, according to interviews with more than half a dozen investors, the wider recovery in European tech investment activity looks likely to extend into 2021 as venture-backed startups achieve scale.

Proceeds raised by European venture funds have already hit an annual record 17.1 billion euros in the year to date, while the amount invested in startups has reached 39.7 billion euros, according to data platform Dealroom.co.

Taking into account reporting lags, the final sum invested is on track to beat last year's all-time high of 40.3 billion euros, said Tom Wehmeier, partner at Atomico and author of the closely-watched State of European Tech 2020.stateofeuropeantech.com report.

"The scale of those outcomes is getting bigger and bigger, and the velocity in which value is being created - it's getting faster and faster," said Wehmeier, pointing to the 115 venture-backed "unicorns" in Europe valued at more than $1 billion.

While Europe still lags North America by four to one in dollars invested in tech startups, the institutional money flowing into venture capital has grown threefold over the last five years.

Nearly two-thirds of venture capitalists and 70% of their investors expect European tech to gain ground on the United States and China over the next decade, according a survey by Atomico.

Early-stage and growth investor Index Ventures raised $2 billion just before the coronavirus pandemic hit, and soon discovered that remote working enabled it to review and do deals far more quickly.

"We never had a slowdown and had a lot of dry powder," said partner Martin Mignot. "With everyone remote we can see and meet more entrepreneurs."

Where deal flow has slowed is via exits onto public markets, with proceeds from initial public offerings (IPOs) by European technology firms less than half their 2018 peak even as a string of IPOs took US markets by storm.

That partly reflects the growing depth of private markets, however, say investors who point to Klarna, the Swedish financial technology company, achieving a valuation of more than $10 billion in its latest funding round.

UiPath, whose software helps automate routine business tasks, has achieved similar "decacorn" status while still private and, like Klarna, is eyeing an IPO in 2021.

The Romanian startup now has a US headquarters and plans to float there. That's a common route for European startups chasing rich US valuations and founder-friendly listing rules - and a challenge for Europe's tech ecosystem, investors say.

UiPath was backed in its infancy by Earlybird, whose emerging Europe fund turned heads in June when Istanbul-based Peak Games, in which it had invested, was sold to Zynga Inc for $1.8 billion.

Such deals are breeding new startups even in parts of Europe previously little known for home-grown tech entrepreneurship.

"Every liquidity event, every acquisition, every IPO ends up spawning groups of these talented people," said Earlybird's Cem Sertoglu.

While the remote working trend is helping founders take on global markets without having to relocate to Silicon Valley, it is also taking the edge off the near-term risks arising from Brexit − Britain's looming exit from the European single market.

"It won't affect the momentum that much in 2021, given how much pent-up demand there is, how much money is sitting on the sidelines, and how many conversations are happening," said Erin Platts, the London-based regional head of Silicon Valley Bank, a specialist lender to technology firms.

Britain has actually extended its lead this year in venture fund raising and its tech startups have attracted a third of total European investment, Dealroom.co data show.

It also remains the preferred landing zone for US software firms seeking to gain a foothold in Europe, said Stephen McIntyre of early-stage investor and advisory firm Frontline.

"The only people who are talking about Brexit are the Brits and Irish," said McIntyre. "With US CEOs, not only does it not come up – they honestly think it's done."

Subscribe to Israel Hayom's daily newsletter and never miss our top stories!

The post Investment in European tech startups roars back appeared first on www.israelhayom.com.

Trump had to give one-year notice of the US withdrawal from the Geneva-based UN agency under a 1948 joint resolution of the US Congress, which also obliges Washington to pay financial support. The United States currently owes the WHO more than $200 million in assessed contributions, according to the WHO website.

 Follow Israel Hayom on Facebook and Twitter  

After more than 70 years of membership, the United States moved to quit the WHO after Trump accused it of becoming a puppet of China amid the coronavirus pandemic. The virus first emerged in China's Wuhan city late last year.

The WHO confirmed receiving notice from the United States of its intention. "We have received reports that the US has submitted formal notification to the UN secretary general that it is withdrawing from WHO effective 6 July 2021," a WHO spokesman said in an emailed statement. "We have no further information on this at this stage."

UN spokesman Stephane Dujarric said that "the secretary general is in the process of verifying with the World Health Organization whether all the conditions for such withdrawal are met."

Trump had halted funding for the 194-member organization in April, then in a May 18 letter gave the WHO 30 days to commit to reforms. He announced the United States would quit less than two weeks later.

The WHO is an independent international body that works with the United Nations. UN Secretary General Antonio Guterres has said that the WHO is "absolutely critical to the world's efforts to win the war against COVID-19."

Trump has long scorned multilateralism as he focuses on an "America First" agenda. Since taking office, he has quit the UN Human Rights Council, the UN cultural agency, a global accord to tackle climate change, and the Iran nuclear deal. He has also cut funding for the UN population fund and the UN agency that aids Palestinian refugees.

Subscribe to Israel Hayom's daily newsletter and never miss our top stories!

The post US to exit World Health Organization after demand for reforms goes unmet appeared first on www.israelhayom.com.

Based on press releases from Israeli companies that have completed financing rounds, more than $1 billion was raised in September alone.

Follow Israel Hayom on Facebook and Twitter

However, the true figure is likely even higher, as some companies do not reveal investment data, according to the report.

Israeli tech companies raised $650 million in July and $350 million in August, according to the IVC Research Center.

In September, credit company Fundbox raised $326 million, fintech firm Tipalti raised $76 million and open security platform Snyk raised $70 million. In addition, drone defense company D-Fend raised $28 million, and 3D-printing company Xjet raised $45 million.

Reprinted with permission from JNS.org.

The post Israeli startups raise more than $1 billion in September appeared first on www.israelhayom.com.

A bill that passed the US House of Representatives last week includes a provision that would amend the Anti-Terrorism Clarification Act, which provides protections for American victims of international terrorism, that caused the US Agency for International Development to halt in February its projects in the West Bank and the Gaza Strip.

Follow Israel Hayom on Facebook and Twitter

Jonathan Schanzer, senior vice president of research at the Foundation for Defense of Democracies, told JNS that "there was significant cause for concern about a full and total cutoff" of assistance to the Palestinians, especially that which is humanitarian in nature, in addition to a halt in Israeli-Palestinian security cooperation with Jordanian assistance.

"The real issue is ensuring that none of this trickles back to the Palestinian Authority," he said. "I suppose that the devil is in the details in terms of how the money is dispersed, and ultimately, what assurances are put in place that this does not serve to benefit the PA, which was the reason for the initial legislation [ATCA] in the first place."

Section 108 of the United States-Israel Cooperation Enhancement and Regional Security Act, introduced by Rep. Ted Deutch (D-Florida), would reauthorize resuming the projects in the West Bank and Gaza, even though such a decision would ultimately be left to the Trump administration.

It states, "The Secretary of State, acting through the Administrator of the United States Agency for International Development, is authorized to seek to establish a program between the United States, Israel, Egypt, Jordan, Morocco, Tunisia, Lebanon, and the West Bank and Gaza Strip to provide for cooperation in the Middle East region by financing and, where appropriate, cooperating in, projects related to innovation and high-tech."

In the past, USAID officials have been adamant that they work within guidelines to provide aid to the right Palestinians groups.

"We do have strict guidelines on who we work with, and that's simply not just what we do, but across the US government," USAID administrator Mark Green told JNS in December.

Without elaborating, he said there "are guidelines that we follow. We follow administration policy."

The move also comes as the Trump administration has been pushing for greater economic investment in the Palestinian economy, jump-started at its economic conference in Bahrain at the end of June, where $50 billion in investment was discussed.

"The Trump administration has a clear interest in helping to bring about a brighter future for the Palestinian people," Security Studies Group senior fellow Matthew Brodsky told JNS. "That was, in large part, the point of the recent 'Peace to Prosperity' workshop in Bahrain," which was the first part of the White House's peace plan.

"Another point they're clear about is that Israel must be secure, so I'd imagine that any legislation related to providing aid to the Palestinian people must ensure that as a minimum," he continued. "That would mean the funds would need to be implemented by responsible parties, and most importantly, the aid must not fall into the wrong hands, which includes terrorists and murderers the PA tends to fund for heinous acts of violence, such as the 'pay-to-slay' program." That system led to the United States enacting the Taylor Force Act in March 2018, named after the 28-year-old former US serviceman was stabbed to death in Israel by a Palestinian terrorist, whose family has been rewarded by the PA

Other USAID projects in the West Bank and Gaza had dealt with issues related to health, infrastructure and education.

The ATCA subjects foreign governments that receive US funding to American counter-terrorism laws. The PA did not want to be held liable as such.

Chief Palestinian negotiator Saeb Erekat told AFP in January that "we don't want to receive any money if this will take us to court."

Sander Gerber, a New York-based hedge-fund manager who was instrumental in the passage of the Taylor Force Act that defunded most US assistance to the PA for rewarding terrorists and their families, told JNS that there must be a distinction between helping Palestinians as opposed to a corrupt leadership.

"Congress has made a distinction between support for the Palestinian people versus the PA, which is a leading terror sponsor," he said. "I would hope that the final law includes restrictions so that the monies can't be touched by the PA"

Separately, a Senate bill introduced by Sen. James Lankford (R-Oklahoma) to strengthen the ATCA—the Promoting Security and Justice for Victims of Terrorism Act of 2019—would hold the PA accountable in the American judicial system, though it does not deal with the USAID projects.

The bill seeks to be stricter in recognizing Palestinian actions at the United Nations and would be implemented immediately if enacted, while Deutch's legislation would permit until 180 days for implementation before enactment.

Lankford told Jewish Insider that his concern with the House bill is "when it gets applied into real-life situations, I'm not sure it works in the way that's written."

Supporting the spread of Israeli innovation to its neighbors

Nevertheless, several American Jewish organizations do support Deutch's bill in order to spread Israeli technologies and innovation to its regional neighbors, as well as its provision to amend the ATCA.

"With regard to Section 108, Israel is at the cutting edge of many important fields, such as water desalinization, agriculture, disaster relief, high-tech research and development, and all areas of health sciences," said Israeli-American Council for Action Executive Director Joseph Sabag.

"These programs will serve America's interests by providing the broader Middle East region with access to Israeli innovation, which will improve the quality of life for millions and promote cooperation, understanding and peaceful coexistence," he said.

JDCA executive director Halie Soifer told JNS that the act's "passage by unanimous consent underscored the bipartisan nature of US support of Israel in Congress. Regional innovation projects, such as those authorized by this bill in the area of high-tech, also enjoy bipartisan support. Such cooperation was encouraged by the 'Peace to Prosperity' vision outlined by the Trump administration in Bahrain and has the potential of normalizing economic ties between Arab states and Israel."

However, Middle East Forum President Daniel Pipes told JNS, "HR 1837 includes various US taxpayer subsidies to Israel, but also to Lebanon, the West Bank and Gaza. So long as those latter areas are ruled by leaders' intent on Israel's elimination, they should not receive American funding."

An AIPAC spokesperson told JNS that the pro-Israel lobby has yet to take a position on Lankford's bill.

Reprinted with permission from JNS.org.

The post US legislation seeks to restore USAID projects to Palestinian areas appeared first on www.israelhayom.com.

Among the countries whose officials were contacted by Erdan were Spain, Belgium, the United States, Norway, France, Brazil, India, Germany, and Britain. In December 2018, the EU's Court of Auditors published a comprehensive report that found a lack of transparency in the European Union's funding of nongovernmental organizations.

At the time, Erdan, who oversees Israel's efforts to combat the boycott, divestment and sanctions movement, contacted European Commission President Jean-Claude Juncker with a request to ensure the EU halts funding to Palestinian organizations that support boycotts of Israel and prevent the transfer of future funds to organizations that promote boycotts of Israel.

In March, the EU's Foreign Affairs Council made the decision to adopt the principles of the EU's Court of Auditors' report.

Over the past two years, the Strategic Affairs Ministry has published two reports on EU funding to organizations that promote a boycott of Israel. According to these reports, the EU transfers at least €5 million ($5.6 million) to such organizations every year.

Another significant achievement in the effort to cut state funding to such groups came with the closure of the Ramallah-based Human Rights and International Humanitarian Law Secretariat, which served as a funding mechanism for the European government and counted among its members Sweden, the Netherlands, Denmark, and Switzerland.

Although they have been able to receive funding from individual states, the Strategic Affairs Ministry believes the secretariat's closure delivered a serious blow to the BDS groups as since then they have received fewer funds.

Some 350 participants from 30 countries are set to arrive in Israel next week for an international conference aimed at coordinating the struggle against efforts to delegitimize Israel and fight the BDS campaign.

According to Erdan, "The anti-Semitic BDS organizations disguise themselves as human rights activists, thereby succeeding in raising millions of euros from Western states. BDS organizations themselves have testified that our activity is one of the central threats they face."

The post Israel demands EU countries end funding for BDS groups appeared first on www.israelhayom.com.

Trump's decision has left the United Nations Relief and Works Agency for Palestine Refugees in the Near East with a $200 million shortfall that it is trying to cover from Persian Gulf and European donors, and has further strained tensions between Washington and the Palestinian leadership.

Relations have sharply deteriorated since Trump decided last December to recognize Jerusalem as Israel's capital, reversing decades of US policy.

The decision to halt funding for UNRWA prompted Arab warnings that the move could fuel regional crises. Many foreign governments and organizations have criticized the move.

"The US administration has begun to attack the rights of the Palestinian people and international law," Malki said at a meeting of the Arab League in Cairo that was convened to discuss the issue.

Internationally brokered peace talks between Israel and the Palestinians have stalled since 2014. The Palestinian leaders say their political situation has deteriorated since Trump took office in January 2017 and the Trump administration is pursuing policies that favor the government of Israeli Prime Minister Benjamin Netanyahu, a close US ally.

Last month, the US announced that it was halting all funding to UNRWA, saying the agency's business model and fiscal practices make it an "irredeemably flawed operation."

Last week, Trump ordered that $25 million earmarked for the care of Palestinians in east Jerusalem hospitals be directed elsewhere as part of a review of aid.

At the Arab League summit, Jordan, a US ally, said the decision would only fuel radicalism and harm prospects for Middle East peace.

Jordanian Foreign Minister Ayman Safadi said Jordan would hold a meeting "in cooperation with Sweden, Germany, Japan, the European Union and Turkey" on the sidelines of the U.N. General Assembly later this month "in an effort to get more aid."

Three Gulf states have announced a total of $150 million in funding for UNRWA this year, and other countries have made new or increased contributions as the agency scrambles to continue operating.

"I humbly appeal to all of you to ensure the pledges that were made [to UNRWA] are indeed transferred," UNRWA Director Pierre Kraehenbuehl told Arab League delegates in Cairo. "Please also consider opportunities for further donations at this critical time."

Kraehenbuehl also expressed disappointment in the US decision to stop funding for the agency.

"The extremely dramatic circumstances of UNRWA's financial situation are known to you, following the decision by the United States in January to cut funding to our agency by $300 hundred million," he said.

"On the 31st of August, the United States then announced publicly that there will be no further funding to UNRWA, and in an open letter to refugees and UNRWA staff I express my deep regret and disappointment at this decision coming from our historically most generous and consistent donor."

The post Palestinians: US funding cuts to UN aid agency is attack on international law appeared first on www.israelhayom.com.