Strategic Alliance with GoLAN Consulting Inc.

We are thrilled to announce a new strategic alliance with GoLAN Consulting Inc., an established US-based human capital and organizational development firm. The partnership enables Onyx and GoLAN to jointly provide an end-to-end solution tailored for Israeli startups.

You can read the full press release below.

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PRESS RELEASE

For Immediate Release 
March 24^th, 2014

GoLAN Consulting and Onyx Venture Advisors Announce a Strategic Alliance.

NEW YORK, NY – March 24th, 2014 – GoLAN Consulting Inc., a professional services company, and Onyx Venture Advisors LLC, a product innovation firm, announced a strategic alliance today.  The alliance will deliver a comprehensive set of services and business functions to Israeli tech start-ups seeking to expand their operations into the US. 

Clients will benefit from GoLAN’s end-to-end HR/OD services (Human Resource / Organizational Development, including strategic Human Capital planning, complete hiring process, Compensation and Benefits plans, HR and Corporate Growth, and Organizational Processes & Procedures) and Onyx’ product advisory, customer development, monetization, and operational expertise.

“We are excited to collaborate with GoLAN Consulting, a pioneer and leader in their space, and believe that our complementary set of services provides a definitive one-stop-shop for Israeli start-ups as they make their first steps in the US market,” said Ariel Steinlauf, Managing Partner at Onyx Venture Advisors.

Dr. Val Golan, Managing Director at GoLAN Consulting, said of the alliance “Israeli Start-ups are, more than ever, at the forefront of technological innovation, and are increasing their imprint onto the US marketplace. With the unique expertise of Onyx Venture Advisors in digital innovation, this thrilling new alliance offers a comprehensive solution to support successful US implementation of our Israeli Start-up clients.” 

ABOUT GOLAN CONSULTING

For the past 11 years, GoLAN Consulting has been supporting the US implementation of Israeli tech start-ups, and dealing with both the strategic and operative parts of setting up a new entity and building the first team in line with the founders' vision, while keeping the Company DNA intact.

Strategic implementation, operational execution, building executive teams and creating efficient organizational processes are at the core of GoLAN’s expertise.  The company was founded by Dr. Val Golan who has extensive experience in HR strategy, years of experience working with US CEOs of Israeli companies, and positioning newly established teams for long term success.

ABOUT ONYX VENTURE ADVISORS

Onyx Venture Advisors LLC is a product development and innovation firm, based at the heart of New York’s Silicon Alley.  The firm provides digital innovation services to Fortune 100 companies and startups alike with a stated mission to enable clients to innovate cost-effectively and achieve better business results, faster.

The firm advises corporations in the development of new initiatives by guiding the innovation process from ideation, through launch, to performance tracking.  Onyx also assists entrepreneurs with incubating business ideas and bringing the right products to market, and helps early-stage startups identify the right application for their technology, determine the right monetization model, and scale their products/services to support millions of users.

For further inquiries please contact:

GoLAN Consulting Inc.
Val Golan
+1 (201) 475-0188
info@golanconsulting.com
www.golanconsulting.com
www.linkedin.com/company/golan-consulting

Onyx Venture Advisors LLC
Ariel Steinlauf
+1 (646) 274-0200
info@onyxva.com 
www.onyxva.com
www.facebook.com/onyxva
www.linkedin.com/company/onyx-venture-advisors-llc

Yahoo, AOL, And The Sad Truth About Online Publishing OR How I Learned To Overcome My Fear And Love Snapchat

By Ariel Steinlauf, Managing Partner, Onyx Venture Advisors
February 19, 2014

In recent weeks I’ve seen many articles about Yahoo! and AOL, two of the most venerable giants of the early-internet era. The two companies have known many ups and downs, and these days are global corporate behemoths. However, a closer look at their core business – running enormous online media networks – reveals that it is not a particularly lucrative one to be in.

Let’s begin with the smaller of the two – AOL. The days of the mega-merger with Time Warner are long gone as AOL, currently with an enterprise value of only $3.5 Bn, is a standalone company operating two distinct businesses: a declining, yet profitable, dial-up subscription service, and an online advertising business. The subscription business generated $650 MM in 2012, down from $705 MM in 2012, and AOL is using the cash flow it generates to fund the growth of its online advertising business. The only problem is – it’s not growing so fast.

AOL’s online advertising business generated $1.6 Bn in 2013, up from $1.4 Bn in 2012. It is comprised of owned & operated (O&O) properties, which are further divided into display ads and search ads, and a 3^rd-party network. While the latter is growing by double digits (30%), the O&O part is only growing by single digits (5%). Furthermore, 40% of the O&O revenue is attributed to search, powered by Google. As if to exacerbate the situation, the online advertising business is not terribly profitable. A look at AOL’s cost breakdown by segment (which closely mimic the revenue streams) reveals that the O&O segment is barely profitable, while the 3^rd-party network is losing money.

Moving on to Yahoo!, the picture doesn’t get much better. While Yahoo!’s enterprise value is nearly $37 Bn, that value is largely attributed to its 24% stake in Alibaba, the Chinese e-commerce giant slated to go public later this year. With analysts projecting Alibaba’s value at $120 Bn to $150 Bn, one thing is certain – Yahoo! stands to make a boatload of money out of that IPO, and investors value to the company accordingly.

Meanwhile, its core online advertising business isn’t faring so well – the company generated $4.7 Bn in 2013, down from ~$5 Bn in 2012. Similarly to AOL, Yahoo! derives most of its revenue from display ads and search ads, the latter powered by Microsoft. Both revenue streams have been stagnant and most recently have declined. I could go into further analysis of display vs. search or O&O vs. affiliate sites, but the outlook won’t be any rosier. Deducting its Alibaba stake, Yahoo!’s core business is trading at ~1X revenue.

Interestingly, all these numbers serve to highlight is one sad truth – online publishing, even at scale, is not such a great business to be in. This stems from several reasons:

• Content production is expensive
• CPMs are low and getting lower due to
• More accountable models (e.g., CPC, CPA)
• Programmatic buying and real-time bidding (RTB) putting downward pressure on CPMs

 The scale of an online media network is no longer enough to make money, as the content served needs to be coupled with additional data about the user viewing it for advertisers to be willing to pay. That’s why Google’s search ads are more valuable than display ads and why Facebook’s native ad formats are so appealing – both companies have unique, highly relevant information about the user viewing the content and they use it for their advertisers’ benefit. More importantly, they didn’t pay a penny to produce their content.

To keep up with Google and Facebook, AOL and Yahoo! have made, and need to continue making, substantial investments in ad technologies, either developing them in-house or acquiring them (mostly the latter). But, they still need to produce their content as well, while Google and Facebook don’t. Plus, AOL and Yahoo!’s balance sheets don’t support recruiting engineering talent away from these two tech darlings. And without great engineers, their internal platforms are doomed to be at a disadvantage.

If running an online media network is such a terrible business, what business would you rather operate in order to capture all of those coveted digital advertising dollars?

There are three answers to this question:

(1)   Focus solely on producing premium content

The Wall Street Journal and the New York Times are examples of companies who realized they had unique, highly desirable premium content that they can also charge for, separately from putting advertising next to it. They also realized they can’t develop their own independent ad tech platforms and opted to outsource that function. And so, they erected pay-walls. AOL is actually seeing initial positive signs from its own AOL On video platform, but it’s too early to tell.

(2)   Focus solely on creating an ad tech platform that can serve many players

AppNexus, and recently SOVRN, are examples of companies that provide the means for advertisers to engage in RTB and programmatic buying. SOVRN is actually a spin-off from Federated Media, a company that decided to sell its online media network and focus on developing an ad tech platform to serve many players. AOL has recently acquired Adap.tv and instantly became a strong player in the growing video ad serving space.

(3)   Develop a new media platform and invent new kinds of ad formats

Which finally brings us to Snapchat, the new kid on the block that everybody wants to play with, sometimes offering $3 Bn for the pleasure to do. Is Snapchat really worth $3 Bn? Certainly not today, but it might be in a few years if it plays its cards right. All Evan Spiegel et al need to do is figure out how to retain their users’ attention and how to put native forms of advertising in front of them. If they do, they might become the next Facebook. All the while, not paying a penny for the content they serve.

The Surge of Mobile Wallets: Hype vs. Reality

by Michael Bershadski, Managing Partner at Onyx Venture Advisors
Dec. 12, 2013

Ever since the launch of the first iPhone in 2007, there has been a major shift in consumer behavior toward mobile media consumption, shopping and payments.  Mobile commerce is expected to surpass $86B by 2016 in the U.S. alone, according to eMarketer.  Our phones have already replaced our cameras, music players, web browsers, and navigation systems, so the idea that phones will soon replace our wallets is highly plausible.  

Considering that, I thought it would be interesting to put some of the recent announcements in this space into perspective.

After three years of testing and development, major U.S. carriers have finally rolled out Isis, a joint mobile payment initiative in November (available to AT&T, T-Mobile and Verizon customers).  The Isis Mobile Wallet stores credit cards and loyalty programs and makes it possible for users to complete payments simply by waving their phone in front of the check out terminal.  The wallet takes advantage of near-field-communication (NFC) technology and is accepted at thousands of merchant locations nationwide.  However acceptance is far from ubiquitous, as majority of merchants are yet to upgrade existing point of sale (POS) systems to new contactless terminals.  Whether Isis succeeds or fails will be largely determined by widespread adoption of contactless terminals, ease of use and ultimately the carriers’ ability to convince mainstream users of its value and benefits. 

Google, which first piloted an NFC mobile wallet back in 2011, has recently issued a physical debit card that allows users to withdraw funds from their Google Wallet account in an attempt to broaden its reach and bridge the gap with legacy POS systems. Despite being one of the early proponents of NFC in the U.S., Google Wallet has struggled to gain meaningful traction with consumers, and its tap-and-pay feature has been hindered by the carriers, who have all but blocked it from their networks in favor of their own proprietary wallet, Isis (Sprint is the sole U.S. carrier supporting Google Wallet and is not part of the Isis consortium).

Meanwhile, a new startup called Coin announced plans to develop a programmable card that can store multiple credit cards, debit cards, and loyalty accounts and has a new kind of magnetic strip capable of replicating any stored account at the press of a button, allthewhile maintaining physical dimensions of a traditional card (i.e. compatible with existing magnetic swipe terminals). Coin appears to have taken a clue from Google Wallet by developing a proprietary device that is outside of the carriers’ reach and is compatible with legacy POS systems.  However, Coin has yet to face card issuers, payment networks, and financial regulators as it attempts to process and store sensitive payment information.    

While financial institutions have for the most part embraced mobile banking, there is a general sense of unease surrounding POS transactions.  This is primarily driven by the financial sector’s reluctance to share a slice of transaction fees with contenders and desire to protect current merchant discount rates.  That said, the battle is not only over merchant fees, another contentious issue is the data associated with financial transactions.  This is arguably the real reason why Internet giants such as Google have a vested interest in mobile payments.  After all, whoever owns transaction data holds the keys to a treasure trove of consumer behavior information (when and where they shop, what they purchase) and is in a position to influence future purchasing decisions by serving more targeted and timely ads, deals, and offers.

Technology has the power to disrupt industries and to change the power dynamics among the key players.  Publishing and music industries are but two recent examples.  As new mobile payment mechanisms evolve in the form of mobile wallets, smart cards, and (someday soon) wearable devices, they may well threaten financial institutions’ grip on merchant fees and transaction data.  While the financial sector is highly regulated and the underlying payment networks so far remain largely unchanged, the world is changing.  Those that adopt short-term defensive strategies will face long-term risk of being left on the sidelines, disintermediated and ultimately not in control of the customer interface.











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Strategic Partnership with By The People Ltd.

Nov. 1, 2013

We are delighted to announce a new strategic partnership with Israel-based By The People Ltd., a unique IT consulting firm. The partnership enables us to tap the firm's network of highly talented software engineers, designers, and UX experts for the benefit of our clients. 

You can read the full press release below.

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PRESS RELEASE

For Immediate Release 
November 1st, 2013


Israel-based By The People and New York-based Onyx Venture Advisors Announce a Global Strategic Partnership

IT consulting firm By The People and product innovation firm Onyx Venture Advisors announce a strategic partnership that that will greatly expand collaboration between the two organizations.

NEW YORK, NY AND NETANYA, ISRAEL, NOVEMBER 1ST, 2013 – By The People Ltd., an IT consulting firm, and Onyx Venture Advisors LLC, a product innovation firm, today announced a strategic partnership.  The partnership will deliver a comprehensive set of new product development and technology incubation services to clients.  The companies will join forces on client engagements across markets. 

“The new partnership allows our clients to expedite the product innovation process through By The People’s cutting edge network of engineering talent, graphic designers, and UX experts” said Ariel Steinlauf, Managing Partner at Onyx Venture Advisors, emphasizing, “This approach dovetails perfectly with our general philosophy of Innovation-as-a-Service.”

Oren Glanz, Founder and CEO of By The People, said of the partnership “the Onyx Venture Advisors team brings a unique combination of skills, experience, and market expertise that would be incredibly valuable to new ventures our members incubate,” adding, “the partnership gets us ‘people on the ground’ who will represent our strategic and business development interests in the all-important US market.”

The partners expect to work on both existing and new projects in the immediate horizon.


ABOUT BY THE PEOPLE

By The People Ltd. is an IT consulting firm, providing technology solutions and professional services through a unique business model. The firm, based in Israel, is comprised of a thriving network of professional freelance experts and entrepreneurs, who collaborate on projects, exchange ideas and information, and form new ventures.

The firm was founded, and is headed by, Oren Glanz, a seasoned entrepreneur and renowned executive, along with an experienced team of high-tech veterans. The firm’s professional community consists of experts in a broad range of disciplines, including software development, QA, graphic design, technical writing, and more.

ABOUT ONYX VENTURE ADVISORS

Onyx Venture Advisors LLC is a product development and innovation firm, based at the heart of New York’s Silicon Alley.  The firm provides digital innovation for Fortune 100 companies and startups alike with a stated mission to enable clients to innovate cost effectively and achieve better business results, faster.
The firm advises corporations in the development of new initiatives by guiding the innovation process from ideation, through launch, to performance tracking.  Onyx also assists entrepreneurs with incubating business ideas and bringing the right products to market, and helps early-stage startups identify the right application for their technology, determine the right monetization model, and scale their products/services to support millions of users.

For further inquiries please contact:

By The People Ltd.
Oren Glanz
+972 (9) 835-5605
info@bythepeople.co.il
www.bythepeople.co.il 
https://www.facebook.com/BTPeople 
http://www.linkedin.com/company/249041 


Onyx Venture Advisors LLC
Ariel Steinlauf
+1 (646) 274-0200
info@onyxva.com 
www.onyxva.com
https://www.facebook.com/onyxva
http://www.linkedin.com/company/onyx-venture-advisors-llc