The notion that the best ideas are simple is the theme of the Homrun Group, which is taking the simple notion of having “a friend who knows a friend” to help fresh Israeli businesses get their foot in the door in the United States.
In a way, Homrun is like “Jewish geography” for the digital age and the business world.
The whole idea is to aid Israeli businesses that would like to access the American market, but lack connections to get started.
“Instead of giving them money or anything, we just get them the right connections – put them in the right rooms with the right people,” founder and managing partner Daniel Gradus told The Jerusalem Post.
“A lot of people want to make introductions,” Gradus said. “I didn’t invent the fact that Jews want to help Jews or to help their own people. We are just expediting this professionally.”
From its chic industrial offices in the heart of Jaffa, Homrun itself is a start-up of sorts, having begun official operations only this past September when Gradus returned from an eight-year stint in New York while his wife, artist Noa Leshem- Gradus, was in art school.
As a foreigner with a language barrier, Gradus found it hard to permeate the terrain. However, his business blossomed after collaborating with two Americans, brothers Dan and Dave Singer, who are involved in Homrun today as founding partners. According to him, their insight into the system and business connections helped his business go from $400,000 a year to between $7 million and $8 million annually.
The business partners were all aware that Gradus would eventually move back to Israel and when the time came, it was clear that his experience had the potential to be duplicated.
“When I spoke with some of my business partners’ friends and saw how enthusiastic they were about it, I understood I had something special and different,” he said.
“They told me it was the first time that some kind of Jewish organization wanted their phone book, and not their checkbook.”
After a year of preparation in the US, Gradus came back and teamed up with a longtime friend from the army, Eli Elfasi, who is a fellow managing partner at Homrun.
Homrun’s process starts when the company is approached by individual entrepreneurs.
During a meeting, the two sides discuss where they would like the business to go.
“We’re not here to improve a product or invest in it. We’re here to get connections,” he said.
“Then the dramatic part happens,” Gradus says with excitement. A prospective client’s business goes through an analysis by Homrun’s pool of 70 to 80 professionals in the US, who rank the company, provide input and begin to arrange potential contacts that could help the business.
The members run the gamut from those in the business world to lawyers, real-estate agents and accountants, spread out across a number of major American cities. An additional 10 member seats are reserved for Homrun’s “NextDor” group to have their say as well. Each spot can have up to 15 members, giving the potential for 150 more people to have their say What they all have in common is that they are members of the Jewish community who are interested in helping Israel.
On Homrun’s custom platform, the business members have access to a profile of the company and a presentation about it. Each member is sent a new company to rank on a weekly basis. On the company’s page, they can watch a short movie about the business. Homrun communicates what kind of connections they are looking for, then members are asked whether or not they think the company is viable and are asked if they have any suggestions or connections to provide. What comes back after a few days is all sorts of feedback, including connections and advice.
Unlike traditional venture capital investors, who Gradus said are exposed to Israeli companies on a regular basis, Homrun’s members don’t often get to be involved with Israeli businesses, so it is an exciting opportunity for them.
“All this is done even before we decide to take them on board,” he noted.
Then Homrun aggregates the feedback and meets with the business a second time. If Homrun feels they are a good candidate to take on, they start giving out the leads, sometimes providing one at a time to focus on, or providing many at once, depending on the business’s needs.
When a member’s connection is requested, Homrun’s platform allows the business person to easily attach the business’s profile and presentations to an email to be forwarded on.
“We minimize and streamline what they have to do.”
He noted that it doesn’t end with sending out emails. Homrun works actively alongside their clients to make sure they get a meeting and make a deal. If they don’t make a deal, Homrun sends more contacts. Throughout the process, each business has a page, what Gradus calls a “live feed,” of how many meetings were set, how many deals were closed and the comments of the members.
“From one shidduch they can create a $10 million deal – in an email,” Gradus said exuberantly. “By doing the minimum, they can have a major impact.”
Homrun profits by charging a small percentage of the money that each business gets from the deals they close.
A part of the share that Homrun gets goes back to their business, while the other part is equally divided between the members, around $5,000 a year. This is an important factor because, as Gradus notes, he did not want Homrun to be a schnorrer (freeloader).
“We decided not to be a non-profit organization.
I didn’t want to do this and help Israeli companies and then depend on donations,” he said.
“Then the same people who are helping you have to give you a check, too, and you’re automatically standing in line with all the other Jewish organizations.”
Still in its early stages, the company is working with 11 clients. This reflects the fact that Homrun is very particular in making sure that companies are ready to make connections. They have turned down 50 businesses.
Several major projects are in the works at the moment, Gradus said. “Hopefully by September, we will be celebrating our first big deal.”