Eran Ofir is co-founder and CEO of Somatix, a gesture-driven health and wellbeing wearable tech company. Founded in 2015 in New York City, the firm is now backed with $7.5 million in venture capital, and is targeting a digital health market set to exceed $379bn in value by 2024. Ofir, a longtime tech professional with experience in Israel, China and the United States, speaks to Red Herring about leaping from management to entrepreneurship, finding the right team and how differentiation is the key to startup success.
How did your background lead you to Somatix’ foundation?
After nearly two decades working for the benefit of shareholders of public companies, I knew that I needed to make a change. I was determined to shift my focus to a position in which I could find more personal meaning and hopefully do good for people.
Around the same time, friends introduced me to super-mind Uri Schatzberg, now my co-founder at Somatix and our CTO, who holds an impressive track record of algorithmic development of cutting edge tech innovations with over 20 patents to his name. A few years ago, Uri shared his latest finding related to wearables-based gesture detection as a general concept, still at the stage of needing a valid use-case.
What was the biggest initial roadblock you faced?
When I met Uri, who impressed me with his concept of gesture detection, I was hooked. But we faced a major challenge: funding. Never in my previous career did I need to secure funding. I had to move outside of my comfort zone of sales and operations management, and quickly learn the art of fundraising!
Fortunately, I received coaching from top experts at Dreamit Health, a top-10 ranked global healthcare accelerator based in Philadelphia, PA, and the New York Digital Health Accelerator, a New York City-based accelerator for companies developing disruptive digital products for healthcare providers.
Which one piece of advice would you give to anybody starting out in tech?
One word: differentiate. In any business school, you learn about the necessity to come up with something new and innovative addressing a crucial need. But that is not enough. To succeed, you must be in touch with reality. You must thoroughly validate new technologies and identify their business barriers.
Starting a new venture without a unique roadmap for an outstanding offering is a recipe for disaster. Products must stand out technologically and bring new value to users and businesses, and they must be original enough so that they are not easily imitated.
Given Somatix’ cutting-edge field, how hard has it been to hire the right people?
I must admit that this was one of the toughest tasks. Our R&D center is in Israel, and at the time, everyone was looking for machine learning and AI experts. Almost a quarter of people working in the Israeli high-tech ecosystem are employed by the development centers of global giants including Microsoft, Apple, Google, Amazon, Facebook and Intel – who can offer compensation packages well beyond local standards.
That being said, I am proud of our team. We have managed to gather top, highly motivated people that share the vision and the desire to make a change. I surprisingly found that the younger generation of developers, Generation-Y, seek work in which they can find meaning. In that sense, working in digital health is a bonus to attract talent, because the work we do can save lives on a public health scale.
What are your immediate scale plans?
In April 2017 we closed our series A financing round of $6m. This allowed us to expand our R&D team for executing our vision through product development. In the next year we plan to raise additional funds in a series B Round to fuel our growth. The funds will be used to further solidify our commercialization efforts, sales, marketing and to expand into new markets beyond the US.
The need for better data-driven healthcare is global, and our solutions are made to fit any market – it’s just a matter of having the resources to support such geo-expansion. I trust that the series B round will allow us to achieve just that.