In announcing the sale of MyHeritage to Francisco Partners today, the company officially joins the Israeli pantheon of Consumer Internet brands alongside Wix, Waze, and Fiverr. With more than 62 million users across 42 countries, MyHeritage didn’t need an exit to demonstrate its impact, but an exit is still an undeniable milestone for employees and shareholders and definitely something worth celebrating.
For most founders, an M&A exit is the end of the road for an ambitious vision that is yet to be fully realized. As a result, in the weeks leading up to a sale many founders experience pangs of guilt knowing they are succumbing to the irresistible allure of immediate, life-changing wealth. But for the luckiest entrepreneurs, more rewarding than any monetary gain is the realization at exit that their startup has become an immortal brand that touches people’s lives day after day.
In the case of MyHeritage, today’s announcement is not the end of anything, but merely a way-stop in a journey that is likely to continue for many years to come.
We have become accustomed to startup success being defined by high valuation fundraisings, but captive breeding has made sightings of the once elusive unicorn quite ordinary. The endangered, if not mythical, beast is the profitable high-tech startup that takes more pride in pleasing its customers rather than extracting another dollar out of their pockets; that prefers a headline praising its product than a headline praising its business model. MyHeritage is this type of company, a rare one in the Israeli startup universe whose recognition long trailed its record of accomplishments.
Gilad Japhet, MyHeritage’s founder and CEO, is one of the very few entrepreneurs who actually fulfilled the mostly foolish career guidance to “follow your passion.” Genealogy is his passion, and he literally turned it into a big, profitable business, never wavering from delivering the product experience he sought for himself as a genealogist. Driven top-down from the management team throughout the organization, MyHeritage cares deeply about its mission, its customers, and their data—a remarkable statement in a Consumer Internet world dominated by algorithms that continuously influence your behavior and surreptitiously monetize your data. It genuinely felt good to be part of something meaningful in people’s lives as MyHeritage fulfilled its noble vision of connecting individuals with their family and their family history.
It was through my own due diligence on the company in 2012 that I was exposed to the wonderful hobby of genealogy, prompting me to preserve my own family history before it was too late, finding and reconnecting me to distant and lost relatives, and documenting their nearly forgotten stories. Although genealogy is focused on the past, its documentation is undoubtedly a gift for future generations. And it is thanks to MyHeritage that meaningful and profound family stories, facts, and images can be revived and memorialized in the digital domain, so that they may outlive each one of us.
In choosing to stay private, MyHeritage is rewarded with continued independence, a most precious gift in the fleeting world of startups. MyHeritage demonstrated the power of being profitable and independent early last year at a time of global scarcity when Israel’s COVID-19 sampling supplies nearly ran out when it donated 66,000 of its own cotton swabs (meant for genetic genealogy tests) and had them flown in from the USA in a special operation to the Israeli Ministry of Health. And yet again when it feverishly worked to build, equip, and staff the COVID-19 test lab the country didn’t yet know it desperately needed. Outsiders couldn’t make sense of a startup investing millions of dollars to serve the citizens in its home country and naturally assumed foul intent, systematically blocking the lab’s approval progress and then detracting it once established. But those who didn’t know Gilad Japhet couldn’t appreciate the relentless zeal with which he and his team pursued any initiative they started. I don’t deliberately invest in companies that save lives, but when I inadvertently do, it fills me with immense pride.
Today is also a great day for the approximately 500 MyHeritage employees, who are among the most dedicated employees a startup could wish for. While MyHeritage is a mature startup founded in 2003, the last few years of product and marketing initiatives have shown that time does not necessarily dampen the entrepreneurial intensity of a startup. From its groundbreaking genetic genealogy and its Theory of Family Relativity™ technology to the company’s photo colorization and enhancement technologies, Gilad and the MyHeritage team never stopped imagining new ways to delight the company’s users. MyHeritage demanded a lot from their team over the years and with this exit milestone, the company gives a little something back.
As I conclude my eight-year tenure on the MyHeritage board, I now join the former employees of MyHeritage who still take pride in their years working at the company, in addition to leaving with a fulfilling, lifelong passion. In passing the baton to new shareholders, I am not only confident that the company’s future is secure, but that MyHeritage users can rest assured their heritage is in good hands.