Growing start-ups is a serious matter at Facebook's Playground

Facebook Israel’s new “Playground” hub in Tel Aviv put consumer-facing innovation at the forefront of its efforts to embrace the local start-up ecosystem.

OCTOBER 28, 2019 09:13

Program participants at Facebook Israel's Playground platform (photo credit: SIVAN FARAG) — Program participants at Facebook Israel's Playground platform

(photo credit: SIVAN FARAG)

Israel’s branding as the “Start-Up Nation” excelling in cybersecurity, fintech or enterprise software has largely been due to its successes in business-to-business (B2B) technology.

According to a recent report by non-profit Start-Up Nation Central, there are currently over 5,300 active B2B companies in Israel and approximately 2,000 business-to-consumer (B2C) companies, selling products and services directly to individual customers. For B2C start-ups, social media platforms including Facebook and Instagram serve as critical tools for reaching new customers. Some estimates suggest that a staggering 97% of B2C marketers promote their businesses using Facebook.

With that in mind, Facebook Israel’s new “Playground” hub in Tel Aviv put consumer-facing innovation at the forefront of its efforts to embrace the local start-up ecosystem. Inaugurated in August by the social media giant’s chief operating officer Sheryl Sandberg, the Playground on Rothschild Boulevard offers cutting-edge facilities for start-ups and entrepreneurs.

The hub is also home to Facebook Israel’s Start-Up Growth Program, a new course for promising consumer-centric companies that have raised capital and are now eager to scale up. Thirteen companies, which have jointly raised $91m. in funding, recently completed the first cycle of the program.

“We know that our teams at Facebook developed consumer-focused methodologies that were proved as best-practices. Our mission is to make those best practices accessible to the start-ups in Israel,” Roni Bonjack, head of EMEA developer and start-up programs at Facebook, told The Jerusalem Post.

“We want to see the Playground as the home of industry in Israel and build a community of consumer-orientated start-ups, putting people in the center. We see the potential in Israel, and we think it can bring more job opportunities and think it may become the next growth engine of the Israeli economy.”

Roni Bonjack, head of EMEA developer and start-up programs at Facebook (Credit: Sivan Farag)

The program is not revenue growth-focused, Bonjack said, but Facebook is aware that helping start-ups to grow ultimately builds a stronger ecosystem. “Wherever the start-up ecosystem thrives, then all of us thrive,” she said.

Participating start-ups in the first cohort included a grocery distribution-tech company, an insurance platform for drones and scooters, a customizable business app builder, and a digital banking platform for migrant workers.

“If we are here to build a scalable business out of Israel, we know we have to empower the whole leadership team,” said Bonjack, detailing how the program offers four professional tracks for business leaders, providing tailored workshops and mentoring for CEOs, CTOs, VPs of Product and VPs of Marketing.

“In many Facebook teams, they primarily work with clients on media and campaigns. That’s not the case here in Israel. The Israel office really works with partners according to a 360-degree approach, looking mainly at strategy and how to help these businesses grow.”

According to Adi Azaria, the CEO of participating start-up Workiz, professional life is a matter of “constant learning.” The software start-up, which has raised $2m. in funding, assists field service professionals, including electricians and handymen, run more professional and profitable businesses.

“The Playground offered an opportunity for me to learn further, to learn new methodologies and new ways of how to make successful business,” said Azaria, who previously co-founded business intelligence firm Sisense. After joining the program, Workiz opted to invest greater sums in video-based marketing rather than text or images to increase its exposure.

Workiz CEO Adi Azaria (Credit: Tom Azaria)

“The customer world is huge and it’s a very noisy world, where people are being sold everything, from toothpaste to restaurants and food,” he said. “Everybody wants attention. Imagine being a start-up trying to be seen in this kind of market.”

While some start-ups famously began in their founder’s garage, Shookit joined Facebook’s Start-Up Growth Program after emerging from Tel Aviv’s Carmel Market. The start-up offers a direct-to-consumer e-commerce grocery service, providing an alternative to the traditional model of fruit and vegetable supply.

“Our brand is mostly based on experience. Our target users and audience are in their 20s and 30s, mostly on Instagram, young parents. It was amazing to work with a partner at Facebook where we built relationships with our consumers,” said Shookit chief marketing officer Dan Eblagon.

“We received the chance to hear a lot of things under the hood that were super valuable, from strategic and creative thinking to how to optimize and understand how the platform works. For most of the teams that participated in the program, it was valuable to meet other founders, share and talk about similar challenges.”

While Shookit has directed its attention to individual consumers as it digitizes one of the world’s oldest trades, Eblagon says the program made it clear that the B2B world can have plenty in common with their consumer-focused efforts.

“There are a lot of B2B approaches. When you go to sell to a restaurant or coffee shop or a 50-employee start-up, you don’t target enterprises anymore,” said Eblagon. “You find the right person. So we now know to build our value proposition as a more consumer-focused company than ever.”

Similar to many B2C start-ups, Facebook serves as the primary advertising channel for male grooming product maker Maapilim. Despite working for large companies and organizations, founder and CEO Jonathan Keren said he was never exposed to the human resources side of business.

“It was really interesting to hear Facebook’s perspective on how management and developing employees works,” he said. “From the process of recruiting new employees to to managing people in the company, Facebook shared a lot of internal methods and also brought in a lot of other experts to talk about joint management.”

Maapilim CEO Yonatan Keren (Credit: Liron Erel)

Due to the prevalence of B2B companies in Israel, Keren said he had previously found it difficult to consult with other business owners. B2C start-ups, he said, face the particular challenge of working with far larger numbers of customers.

While the Start-Up Nation brand might have developed due to large B2B tech companies providing solutions for big industries, Keren said that companies like Wix and Lightricks are an inspiration for entrepreneurs building consumer-facing businesses in Israel.

“It has also become more feasible to create B2C businesses, with social and technological developments. Companies like Wix and Lightricks are not only showing that there is a way to grow B2C businesses in Israel, but people leaving those companies go and create their own businesses,” Keren said.

For AppsVillage founder and CEO Max Bluvband, the key to B2C success is making the consumer the king. The Rishon Lezion start-up enables businesses to build smartphone apps in minutes, based on information contained within their Facebook or Instagram page.

“Business is about conversions and money but also to take the customer and put him inside the business, and not feel like a credit card,” he said. “If you look at Facebook, they are doing it amazingly. They know how to make the customer the king, how to address customer needs, and how to monetize it while keeping him the king – not taking advantage of him.”

AppsVillage CEO Max Bluvband (Credit: A-Labs)

Seeking to expand to emerging markets across different continents, Bluvband said he learnt a variety of business techniques to increase revenues quickly while remaining a favorable company among users. The start-up now aims to turn over up to $10m. in revenue over the next two years.

"In recent years, we have seen a few seeds of consumer-oriented start-ups in Israel," said Bonjack, who is planning to welcome a second cohort of start-ups early next year. "At Facebook, we see products that billions of people love and we have learnt many things by building a people platform. When we put the user in the center, it really defines our approach to how we build our product, and how you build go-to-market strategies."