Seeing him on shows like Two and a Half Men, or in movies like Dude, Where’s My Car, you wouldn’t take Ashton Kutcher for a sophisticated high-tech investor. But Kutcher was all business on his first all-business trip to Israel (he’s been here three other times, for “spiritual purposes”), and in just a couple of days has picked up a lot about the business of Israeli high-tech.
For instance, Kutcher told an audience of more than 1,000 people in Tel Aviv Monday night, Israel is great at developing ideas, but not so great at following through with funding for the start-ups created here. “My understand is that there is a severe Series A funding crisis. Companies get seed money and build an alpha product, but they run out of money before they iterated their product, and few Series A funding people jump in to help.”
Kutcher runs, together with his partner/manager Guy Oseary, several start-ups and an investment fund. The Israeli-born Oseary’s Untitled Entertainment manages, besides Kutcher, the likes of Demi Moore, Lucy Liu, David Caruso, and others. Oseary also manages Madonna, and he directed her concert here in Israel last year.
Kutcher and Oseary spoke at an event sponsored by GarageGeeks, a group that sponsors activities and events for the high-tech and start-up community in Israel. The group holds events every month or so that features a talk by a start-up CEO or investor. This month, thanks to the efforts of tech guru Yossi Vardi (who emceed the event) Kutcher found himself standing on a balcony at the Academic College of Tel Aviv, near the Tel Aviv-Jaffa border.
While usually a “Geeks” event might get a few dozen attendees, word spread through social networks that Kutcher would be speaking, and the group decided it needed a bigger venue than the converted garage it usually uses in Holon. And they weren’t wrong; well over 1,000 people were at Monday’s event — not all of them interested in the high-tech business, either.
But high-tech was what Kutcher and Oseary had come to talk about, on a trip dedicated to rooting out possible investments for the pair. Oseary said that he has been investing in Vardi-recommended projects for over seven years, and Kutcher recently decided to seek out Israeli investments as well. Dotting his talk with Hebrew phrases — the format was Vardi interviewing Oseary and Kutcher — the actor spoke his mind about Israeli technology, the people working in it, and even how it’s helping the peace process.
Kutcher may have his mind on the movies — his latest project has him playing Steve Jobs — but he is no tyro when it comes to tech. Kutcher has been investing in tech companies since 2010, and was an early investor in digital social magazine Flipboard. So far, his biggest investment ($112 million) has been in bed and breakfast reservation platform AirbnB. So far, Kutcher and Oseary (along with third partner Ron Burkle) have, through their Grade-A venture fund, invested close to $200 million in some 30 start-ups.
And now Kutcher has discovered Israel, which, he said, has exactly what he looks for in investments. “Israel doesn’t have a lot of natural resources. Its real resource is its people and their creativity, and that has inspired me.”
Israel, he said, reminds him of himself growing up. “In my family we didn’t have a lot of ‘natural resources,’ meaning money. We had to use our minds and become our own creative resources. My goal is to embrace the people, ‘the natural resources of Israel, and to build businesses with the creative Israelis.”
Finding good investments is a lot like finding a good film to back, Kutcher said. “In the movies, you want a good story and characters that are honest, but you are also looking for a good director who can lead the ship. That’s how we look at business.
Everybody has a great idea for a start-up, and so do their relatives, and they tell me, ‘you gotta build it.’ I say I have to believe in it,” and that belief depends on how competent and creative the people in charge are. “For us, it’s ‘founders first,’” Kutcher said, and with a large community of creative CEOs, Israel has the kind of talent his team seeks out.
Kutcher started out in, of all things, chemical engineering, but quickly found success in the entertainment business, first as a model, and then in Hollywood. But early on he understood the impact of Internet technology and social media.
“I started a film production company when I was 21,” in 1999, Kutcher said. “By 2005 or 2006, I realized that the Internet was getting fast enough to allow for the growth of streaming video, and I started getting into that, and into digital analytics.” He started looking at companies in the video space, and came across a lot of other interesting start-ups — especially in social media, which appealed to him because it fostered communication between people, and allowed new and novel ways to market ideas, products, movies, and music.
“I found myself surrounded by people who were building things to communicate in different ways, and that appealed to me,” Kutcher said, adding that improving communication was something he strove for. “The film industry brings people together, and so does technology. I see them as similar platforms.”
From what he has seen, Israel is an important place for that communication revolution. “When I went into business with Guy a few years ago, we decided we wanted to change the world, and we looked for investments that would do that. We especially looked at companies that let you connect, with people socially trusting each other on the Internet.”
For Kutcher, improving communications and relations between people is a paramount value, and Israel is “an epicenter of that value. It’s surrounded by enemies and hostility but has been successful in making peace with its enemies,” at least to some extent. “This is something that can change the world, and that change will come from here.”
The audience was full of entrepreneurs — some successful, many of them would-be — and Vardi opened up the floor to questions. One that Vardi himself asked was what Kutcher would advise a young entrepreneur starting out — what could a young Israeli do to make it in the tech world, as Kutcher himself has.
“I learned the secret of success a long time ago, from my kabbala teacher in Israel,” Kutcher said.
Kutcher is not Jewish, but he is very active in the Kabbala Center in Los Angeles, and has been in Israel three times on “spiritual quests.” According to reports, he will be spending Shavuot at Jerusalem’s Kabbala Center.
“We visited the grave of Rabbi Akiva, and I started crying,” he said. “I had an emotional response to all the energy that was there, because I had heard all these stories about him and about all the incredible sacrifices that he made. I said to my teacher that I wanted to be more like Rabbi Akiva. He looked at me and said that I didn’t need to be more like him, but more like Ashton Kutcher. Because when you get to the [heavenly] gates, they are not going to ask you why you weren’t more like Rabbi Akiva, but they will ask why weren’t you more like Ashton Kutcher — why didn’t you accomplish the things Ashton Kutcher was supposed to accomplish.
“Anyone who wants to be an entrepreneur like someone else is actually looking in the wrong direction. You don’t look out for inspiration, you look in,” Kutcher added. “You have to ask yourself how can I be better today, at solving the problem I am trying to solve for my company. I wouldn’t encourage anyone to be like me. Just be like you.”