Arieli Capital, that direct line between Tel Aviv and Milan in the name of fashion

Thinking about Israel, the first images that come to mind are war photographs, but Israel is not just a battlefield. Here, despite everything, innovation continues and it holds on to the title of continuing to be one of the most important world capitals for theninvestments, number of startups present and innovation economy. Since the beginning of the conflict – October 7, the day of the Hamas attack on Israeli territory – the new Israeli technology companies have gathered the record figure of 3.1 billion dollars, in line with the best years, and were established more than 20 new funds (source: Startup Nation Central). As if nothing was happening in the Gaza Strip. In fact, a third of the funds invested in Israeli startups since the start of the war have gone to companies dealing with military security: from cybersecurity to technologies related to artificial intelligence. But in Israel we don’t just invest in security. There are innovation hubs, like Arieli Capital, where we look to the future with optimism, continuing to persevere and work on sectors already before the war broke out. For example, in fashion, one of the sectors that is most successful in attracting investments not only in Israel but also in our country. And precisely with the aim of connecting two markets and two world-class entities of excellence in this sector, Arieli Capital has decided to focus on Italy, with the idea of ​​creating a direct connection between Milan and Tel Aviv. He told us Or HavivIsraeli entrepreneur and partner & Head of Global Innovation at Arieli Capital.

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Arieli Capital pre and post Covid

«In Arieli Capital, where we invest in and support the startups in our portfolio, we have been dealing with fashion for several years – explains Or to StartupItalia – We were among the first to connect the fashion sector with the design sector in the Israeli ecosystem by working with startups on the one hand and with the largest industries in the sector on the other.” When Arieli Capital started scouting and creating a direct connection between these two great worlds, the world had not yet experienced Covid. «During Covid the market changed profoundly – ​​continues Or – just as the trends changed, making the online presence increasingly central as well as digital processes. Once the health emergency was over, people preferred to return to the physical store, thus transforming the model into a phygital hybrid. We have passed from preferring simplicity of purchase to customisation, with the physical presence of a sales assistant who supports the customer.” At the same time, however, technology has not been forgotten, on the contrary: «Everything that speeds up the purchasing experience and eliminates dissatisfaction is increasingly appreciated by consumers – specifies Or – We have glimpsed this potential in startups».

But then, with the war, inevitably something changed.

War and innovation

«Today there is a great difficulty in delivering deliveries to homes in a short time – says Or – The model “door to door” now it’s very complicated. At a global level, war is only one of the many revolutions we are witnessing in the economic context, like what happened during Covid, but the demand for innovation is constantly growing – explains the entrepreneur – Thinking that during Covid , Italian startups in Israel asked us to participate in acceleration programs. And I am of the opinion that the most powerful innovations are born precisely in the darkest times.” And what has changed (and is still changing today) is not only the business models, but also the trends. «Among these, the impact of social media as promotional channels, with influencers. So technology has become increasingly important for some brands, to allow the user to buy that object or garment directly from the brand’s social profile or from the promotional video itself”, explains Or. This is exactly what it deals with Terrific, a live shopping platform in which Arieli Capital has invested. «Terrific allows brands to use social media and different platforms to buy directly from the influencer and engage consumers».

Evolving trends

The amount of investments in innovation by the brands themselves is continually growing, as the investor explains: «The reason is to be found in the fact that today technology allows brands to do more in a shorter period of time than Years ago”. Another changing trend is the circular economy, to which brands are increasingly attentive and sensitive. It is precisely this topic that he deals with TerraXa startup that became part of START FashionTechthe new Milanese hub driven by Arieli Capital, and which creates high-performance sneakers, clothing and accessories with materials of biological origin. «TerraX even uses pineapple scraps and mushrooms to make shoes which, apparently, are normal shoes but, at the end of their life, you can plant them in the garden because they are completely organic», says Or.

From Tel Aviv to Milan

«The connection with the Milanese ecosystem is fundamental for us, because it is an excellence and it is one of the powers that drive the market in this sector as well as in that of design», explains Or who in Milan is working alongside Milano & Partners, Accenture, Shape Next, Intel Ignite, Microsoft for Startups, Giacomo Brodolini Foundation and Ministry of Economy and Industry Foreign Trade to give a boost to the fashion sector. «As soon as we launched the program in Milan it went overbooked – he says – The startups we support here come from countries like Israel, India, Germany and when they arrived in the Lombardy capital they understood that they wanted to lay the foundations for doing business here. Here they want to open offices, look for partners. And as Arieli Capital here we want to create local impact. I noticed that in Milan there is a large gap between investments in startups and the potential they have, something that was not known 5 years ago, when I started building relationships with the Italian ecosystem. Today this relationship that we have created will attract more and more investors and opportunities, trying to fill this gap.”

Arieli Capital’s next steps

Among Arieli Capital’s next steps is to launch a series of businesses locally in Italy. «We want to work closely with startups and partners to give relevance to what is a sector of excellence for the entire ecosystem – says Or – This is why we are focusing on Milan, especially in this phase, and we aim to stabilize the teams venues and organize events with startups to close deals and implement aspects of the business. Innovation is capable of crossing all bridges, because it is something that everyone in the world needs to feel better, create opportunities and create an ecosystem.”