Oded Hermoni has lived, created and invested in business in the top two regions for startups: Israel and Silicon Valley. Hermoni discussed valuation, acquisition strategy and profit and loss at his Wednesday night fireside chat at Startup Grind. However, he said that this is the No. 1 thing to take away from his fireside chat:

“Tech and innovation is about people.”

The man has invested in companies sold to Facebook and Apple, has founded three startups in Israel (one of which was acquired by Yellow Pages), led the Israeli VC Industry Association and the Israeli High Tech Industry Association, and is now a partner at the early stage venture capital firm Rhodium Capital, where he is the liaison between Israeli and Silicon Valley.

Hermoni’s big takeaway may not seem new, but did you even read the highlight reel of his achievements in the previous paragraph? I’d listen closely.

Throughout his fireside chat at Startup Grind, Hermoni emphasized the importance of creating an ecosystem in the Maritimes, like the ones in Israel and Silicon Valley.

“You need to have a trigger to start it,” he said. “Ecosystem isn’t just the university: it’s funding, it’s talent—it’s everything.”

His No. 1 recommendation to create a solid ecosystem was to connect with the universities. Israel and Silicon Valley heavily depend on commercialization, talent and funding from universities like Stanford and Tel Aviv University.

Hermoni recommended that entrepreneurs provide incentives to the university and these offices to fuel more successful startups.

In Israel, academics who help companies with research and development are allowed to have one day a week to work with the company exclusively. Forty to 50 percent of investment into the company also goes back to that university faculty.

“The main job of the academic is to publish papers, not work on a multimillion dollar company,” Hermoni said. “So give them freedom.”

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Universities can also provide both funding and talent. Hermoni emphasized that using talent from the universities will allow young people and academics to stay in the region—something the Maritimes struggle to do as many youth go westward.  

Keeping immigrants in the region is also important for startups, Hermoni said. When immigrants first come to a new country, they usually aren’t able to teach because of language barriers, despite having high levels of education. Startups should use this to their advantage and hire these immigrants to help them with research and development.

This is exactly what Israel did: after the Soviet Union collapsed in 1991, a wave of Russians came to Israel, many of whom were engineers, scientists and academics. Israel turned this potential problem into an asset: it allowed the Russians, many of whom didn’t speak Hebrew well, to continue their research and use their top-notch scientific and technical skills to help build what we now know as Startup Nation. 

“This is an opportunity to open the door to immigrants,” Hermoni said. “You may find something that can create growth in this area, if you find the right mechanism.”

Hermoni had also heard about the large amounts of government funding available to startups in the region—and was amazed by the support. However, he said that the government needs to understand that failure is a part of startup life.

“Failure is experience. It’s okay to fail,” Hermoni said. “If the [Israeli] government had only looked at profit and loss, if what they lost in three or four or five years, nothing would happen. But in 20 years, it was an amazing problem.”