HomeInterviewsYL Ventures, Interview with Operating Partner Elias Terman

YL Ventures, Interview with Operating Partner Elias Terman

Elias Terman, Operating Partner, YL Ventures
Elias Terman, Operating Partner, YL Ventures

Israeli and Silicon Valley based venture capital firm YL Ventures has just announced the addition of Elias Terman to the Operating Partner role. In conjunction with the announcement, Elias replied to our questions about himself and firm and shared with us some insights about his activity.

VCWire: Hi Elias, can you please tell us more about you? What’s your background? 

I started my career as an entrepreneur, and during my corporate life, I’ve focused on marketing early-stage startups. That’s the most exciting stage. You’re moving fast to bring the business to life and introduce it to the market. For the last 15 years, I’ve been building and running marketing teams at cybersecurity startups including Uptycs, Integris Software (acquired by OneTrust), Distil Networks (acquired by Imperva), and OneLogin. I got to know the YL Ventures team as the first marketing hire at Orca Security, one of YL Ventures’ unicorn investments. My experience with helping cybersecurity startups scale will be instrumental in guiding the firm’s portfolio companies toward expanding their customer base, optimizing customer outreach, and accelerating revenue growth.

VCWire: Can you introduce YL Ventures?

YL Ventures is a global cybersecurity-focused VC firm, investing in seed stage cybersecurity startups for over 15 years. The firm operates in the US and Israel and supports exceptional founders with transformative security solutions for the most poignant and pressing cybersecurity problems and gaps in the market. The firm bases its investment mechanism on a value add strategy, supporting and guiding portfolio companies from their nascent company-building stages to category leadership. Well-entrenched in Israeli and global cybersecurity industries, YLV is well-known for its deep domain expertise, expansive network of cybersecurity leaders and successful investments in some of the industry’s leading startups. In 2022, YL Ventures ranked 8th out of over 250 venture capital firms in PitchBook’s prestigious Global Manager Performance Score League Tables and was the only cybersecurity-focused VC to secure a top 10 spot.

VCWire: What is your overall strategy?

YL Ventures is laser-focused on investing in early-stage cybersecurity startups with a high-conviction and high-involvement model to bolster them toward market domination within their categories. We are currently investing out of our fifth fund, with $800M in total AUM, and we are very disciplined in our strategy, with only a handful of new investments over the fund’s lifecycle. YL Ventures’ specific domain expertise in cybersecurity gives added value to our portfolio companies, as we can help them better understand their target market for a strong head start. This approach allows us to provide deep, focused guidance and address the needs of our portfolio companies at the most fundamental stage of their startup journey, as well as ensure their long-term viability and sustainability regardless of market fluctuations, even in more challenging economic environments. We collaborate with top-tier global venture capital firms who share our approach and investment philosophy in a “split seed” model, allowing us to bolster exceptional startups to a strong position in the market from the get-go.

VCWire: Beyond capital, how do you support startups? 

Our main differentiation in the VC industry is providing hands-on and deep support – strategic and tactical – to our portfolio companies beyond capital. The firm has an in-house team of multidisciplinary professionals who get in the trenches with the portfolio companies and focus on the most crucial elements required of startups at their earliest stages: GTM strategies, product-market fit, customer discovery and traction, marketing, hiring, operations and more. I’ll be joining this stellar team to help drive customer traction and revenue growth across our portfolio by leading customer outreach programs to identify and connect with our companies’ target audience at scale and help them supercharge their sales pipeline from the earliest stages. My activities will complement the firm’s comprehensive marketing efforts led by Partner Sharon Seemann, whose team helps our portfolio companies build their marketing foundations including brand, content and lead generation from day one. Our new customer outreach programs, which I’ll lead, will amplify these efforts and translate them into scalable customer traction.

In addition, the firm’s portfolio founders have access to a powerful network of over 100 Chief Information Security Officers and senior security practitioners hailing from Fortune 100 and global corporations. These luminaries provide advice that helps founders cut through the noise of early-stage company building and focus on the strategic elements they need for a strong head start – especially around product-market fit and GTM strategies. 

VCWire: What do you like to see in founders?…. And what don’t you like to see in them? I mean, is there something that impresses you at first glance?

We invest in exceptional entrepreneurs motivated enough to disrupt a big market and make a real change. This requires stamina, passion, grit, competitiveness and a large vision. We look at the team and assess the combination of technical, leadership and management skills they bring to the table, and the dynamics between them. For us, the bottom line is always a strong team addressing a pressing problem in a large and growing market. Obtaining real validation from potential customers is very important, as is our founders’ ability to receive criticism and adapt accordingly. We like to see agile, innovative founders with a large vision and determination to build a category-leading company around it. 

VCWire: Please, tell us a bit more about the portfolio. You can list five startups that have made you particularly proud of.

Among its successful investments, YL Ventures has backed cybersecurity unicorns such as Axonius and Orca Security, and its portfolio companies have been successfully acquired by high-profile, global industry leaders including Palo Alto Networks, Microsoft, Okta and Proofpoint. 

A few of our investments I’m particularly proud of include Aim Security, which recently raised its Series A round only 4 months out of stealth, with the industry’s leading Security for GenAI platform, providing holistic and comprehensive security for all GenAI use across enterprises; Gutsy, pioneering the use of process mining for the first time in the security realm, which gives security teams unprecedented visibility into every tool, process and action required for a fully-compliant and efficient security posture; Miggo, with the first Application Detection and Response (ADR) platform that looks inside the application while it’s running, providing continuous in-application context to map the flows between application services, draw baseline behaviors and detect malicious activity; Opus Security’s cloud security remediation solution, that provides unmatched control and oversight of remediation processes, ensuring every vulnerability is managed and addressed effectively and Piiano, a unique data security platform designed to proactively prevent data breaches in homegrown applications, right from the software development phase.

VCWire: Which sector/s would you bet 2 cents on in the next five years?

Cybersecurity, of course! But within cyber I’d bet on application security which includes everything from making it easy for developers to build more secure apps, data privacy and security, to bringing teams together to find and fix vulnerabilities or remove a threat. Companies of all sizes are building highly distributed custom applications on top of cloud platforms and incorporating new tech like GenAI. That’s not slowing down anytime soon. It also represents an increasingly complex and expanding attack surface to protect.