Commentary | Building Long-Term Founder-Investor Relationships

Israel’s tech ecosystem is a gift that keeps on giving, renowned for its innovation, resilience, and ability to punch above its weight. At the heart of this success lies a critical yet often underappreciated dynamic: the strong Israeli bond, and personal relationship between the brave founders and their backers.

 The journey is long and volatile, subject to internal execution and external forces like economic turbulence, geopolitical tensions and rapid technological changes. To brave through these and advance, be it the next funding round or a shiny M&A, founders require trustworthy, supportive relationships with their investors.

But how do you turn a promising first connection into a resilient, long-term partnership?

Here are some insights from my own experiences into what makes these relationships work and why they’re so vital to Israel’s tech ecosystem.

The Initial Connection: Beyond First Impressions

Every great partnership begins with a meeting of minds. For investors, the first encounter with an entrepreneur is about more than just evaluating a story or personal journey—it’s about assessing vision. How big is their dream? How much opportunity is there and what is the scalability? How mature are the team and their offering? These are the questions to align on before committing to an investment.

For entrepreneurs, the choice of an investor is equally strategic. Beyond the check, founders should seek partners who bring industry expertise, a robust network, and a commitment to long-term growth. In Israel’s tight-knit tech community, reputation matters, as does global perspective, experience, and connections.

Founders want investors who will roll up their sleeves during tough times and help them evolve and advance, whether it’s tweaking product to current market needs, unlocking key deals, or making sustainable growth decisions that will shape the future of the business.

Nurturing the Relationship: Building Trust and Alignment

The true test of any partnership is how it evolves after the initial deal is signed. Trust is the foundation, and it’s built through transparency, communication, and shared goals. 

During recent market upheavals, I found that startups that maintained open lines of communication with their investors were better equipped to pivot and adapt. Regular updates—both good and bad—foster a sense of collaboration and ensure that challenges are addressed proactively. 

These relationships are rarely perfect, but creating and maintaining a healthy dialogue can help startups go from rocky waters to smooth sailing.  

Alignment of vision is equally important. Investors and entrepreneurs must agree on both short-term objectives and long-term aspirations. They must determine what level of investor involvement is best for both parties. This alignment becomes especially critical when navigating industry-specific challenges, such as increased competition, technological disruptions, or shifting customer demands.

It is this alignment that helps founders and investors overcome challenges together. 

For example, one of my portfolio companies had initially thrived in a rapidly growing sector. However, as the industry evolved, the rules of engagement shifted dramatically, and their core product required significant adaptation to remain competitive. Recognizing this pivotal moment, we came together as a unified team—entrepreneurs and investors alike—and spent many intensive hours collaboratively rethinking the product strategy.

This joint effort was more than just problem-solving; it was an exercise in mutual trust and alignment. By openly sharing perspectives and challenging assumptions, we collectively transformed uncertainty into opportunity. 

My confidence in the team's resilience, adaptability, and innovative spirit grew immensely during this process. Equally important, their trust in my commitment, insights, and willingness to stand shoulder-to-shoulder with them deepened significantly. 

It is exactly these moments of genuine partnership—where everyone rolls up their sleeves, works collaboratively, and navigates challenges together—that exemplify how investor-entrepreneur relationships evolve into powerful, lasting alliances.

The Long-Term Vision: Sustaining a Fruitful Partnership

The journey doesn’t end with a successful exit or a funding round. Every fundraising milestone marks a new level of maturity—bringing with it new challenges and the need for continued evolution. 

As startups scale, they must not only surround themselves with the right people but also make tough decisions about letting go of those no longer relevant to their next stage of growth. This is another example of where investor experience and relationships can prove invaluable.

Maintaining an active partnership beyond the initial funding event is key to long-term success. Regular strategic planning sessions, reinvestment opportunities, and a shared commitment to innovation ensure that both parties continue to thrive. 

When these relationships withstand the test of time, they evolve beyond mere business transactions, becoming meaningful long-term alliances that extend far past an exit.

While all VCs try to help where they can, it's the wider US focused perspective that is, at times, missing from the Israeli ecosystem. Founders should seek investors that can help bring the US market closer to them.

For Israeli startups looking to expand globally, investors serve as critical partners in navigating foreign markets. By leveraging their networks, experience, and expertise, investors help startups establish partnerships, adapt to regulatory requirements, and mitigate risks associated with global expansion. 

This collaborative effort enables startups to scale effectively—not just securing growth, but sustaining it over time.

Moving Forward, Together

The relationship between investors and entrepreneurs is the lifeblood of Israel’s tech ecosystem. It’s a partnership built on trust, communication, and a shared commitment to innovation. By fostering these connections, we not only weather challenges but also unlock new opportunities for growth and impact.

As an investor, I’ve seen firsthand how these partnerships can transform startups into global leaders. The resilience and ingenuity of Israeli entrepreneurs continue to inspire me, and I’m proud to play a role in their journey. Together, we’re not just building companies—we’re building the future.

Moshe Zilberstein is a General Partner at Next47