Ariel Cohen’s latest startup has amassed $1 billion in equity and debt to disrupt one of the biggest industries on the planet: corporate travel.
A repeat founder and tech entrepreneur, Ariel Cohen has surrounded himself with an amazing team and group of advisors to navigate the virus and help others do the same when it comes to getting back to business and business travel, safely.
In our exclusive interview on the DealMakers podcast, Cohen talks about the top tips for weathering the storms of entrepreneurship, as well as why we must have a product-market fit for a long term business, and how to create accountability guardrails to make sure you keep it once you’ve got it.
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He and his team have been through the dot com bust, 9/11, the 2008 financial crisis, and now COVID-19.
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Born in Startup Nation
Originally born in Jerusalem, Ariel was fortunate to grow up in Israel, the Startup Nation. Although his school days may have been before the current startup ecosystem really became a thing, it is a nation that has long had a very entrepreneurial culture.
After completing university, Cohen went to work for a startup and has been hooked on tech startups ever since.
He joined the party back in 1999. Despite having added a few grey hairs along the way, Ariel says the rollercoaster nature of being an entrepreneur is actually one of the things he loves most about it.
From his perspective “It’s exciting. It’s a team sport. There is always something happening. There is a thrill in the ride, even in the build-up to the top, when you know there are going to be big scary moments.“
In addition to starting his own ventures with his cofounder IIan Twig, he has worked for CommTouch, HP, Mercury Interactive, and Jive (twice).
Some of these corporate roles were the result of his ventures being acquired. Even though big giants like HP might be the complete opposite of the nature of an entrepreneur, he took away great lessons from the time he put in.
He got to see what big companies looked like on the inside, their go-to-market, and how they served the enterprise. At Jive, he says he even learned to think about the end-user in how to solve the problem.
The Importance of Product-Market Fit
In the world of startups, product-market fit is considered the holy grail. It typically makes or breaks startups. It can be incredibly elusive. It can be the most important thing an entrepreneur should be thinking about.
Ariel’s startups are two very different tales of product-market fit. He has enjoyed huge success when they found it. Yet, his path to finding it may seem very unconventional to most. However, he has also proven you can have a successful startup with a strong exit without finding the perfect fit. But you can tell from the conversation, building a long-lasting company and culture with product-market fit that changes a huge industry ripe for disruption is his passion.
At his first startup, Cohen says they felt they really understood the need in the marketplace. Yet, they struggled to find the customers for their products. When you don’t have fit, everything is much harder. In contrast, when you have product-market fit, you can get away with making mistakes and still win.
Their first business was streamOnce. Despite lacking product-market fit, they sold the business in just nine months. Their investors gained at least a 3x return in that short period: A success by most investor’s measure
Both of their partners Box and Jive bid to acquire them. Jive won the negotiations, and Ariel found himself doing a stint back at his old employer. It was a move they believed would best unlock the potential for their technology and help their acquirer.
Today, Ariel says key questions to ask on the road to finding product-market fit and ensuring you are going into a startup that has the potential to build a real and exciting product and company include the following.
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- Do you have a unique observation on the market?
- Do you have the ability to create something?
- What is your unique value proposition?
- Are you passionate enough about this?
- Do you fully and personally understand the problem?
- Are you excited about solving this problem?
- Is the market ready?
- Is the market big enough?
Their second startup is a very different scenario. Yet, it didn’t begin with the cliche idea of a great product.
Instead, Ariel and his cofounder began with the why. Why do another startup instead of just working with or for someone else?
This helped them really learn more about themselves. They decided what was important was building a long-lasting company that could change an entire industry and makes a real and meaningful difference.
They fell on their shared passion and expertise for travel. They were both road warriors, who know all the tools out there very well. They understood corporate travel from a business perspective and had the management experience.
They began by defining all of the criteria and boxes this company would have to check. All before even thinking about a product. They believe this is why TripActions is so successful.
TripActions is a B2B travel startup with customers like Zoom, Okta, Box, Lyft, Crate and Barrel, Game Stop, and Sara Lee Frozen Bakery. Their customers’ employees use TripActions to book their work trips, pay for those trips and expenses along the way, and get travel agent support so they can focus on being there, rather the process of getting there.
They’ve already raised nearly half a billion in equity capital and another half-billion-dollar in debt financing. They’ve got experienced advisors on their board like Zeev Ventures, Lightspeed, Group 11, Andreessen Horowitz, and others.
Storytelling is everything which is something that Ariel was able to master. Being able to capture the essence of what you are doing in 15 to 20 slides is the key. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) where the most critical slides are highlighted.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below
Among the features, they continue to roll out is the ability to track where your employees and executives are in the world, where they’ve been, where they are headed, and where it is safe for them to travel. All incredibly important factors as the business get back to work after this initial round of COVID-19 related restrictions and prepare to be able to skillfully navigate similar issues in the future.
Listen in to the full podcast episode to find out more, including:
- How TripActions built a business model which compels them to continue to create value for customers and keep users engaged
- Ariel Cohen’s top three tips for weathering storms like the coronavirus
- Handling layoffs in moments of challenge and change
- His top advice for others considering entrepreneurship
- Why he says you should start your own business earlier