“AI is changing the way startups are built” | CTech

The value of companies in the past was based on ARR (Annual Recurring Revenue), and today it is changing and there are new rules – said panelists including Amir Iliescu, partner, Shibolet, who moderated the panel; Nitay Joffe, partner at Team8; Itamar Friedman, co-founder and CEO of the startup Qodo, and Eyal Bino, founding partner at the venture capital fund 97212 Ventures. The panel took place at the New York 2026 conference of Calcalist and Bank Leumi. According to the panelists, for years we have looked at software companies and value through revenues, margins – but AI is changing the way we value companies.

If you feel that ARR is not a measurement in the AI ​​era – why is it still there?

Eyal Bino: “What is happening today is that customers and retention are more significant than annual revenue. A round changes the way companies are valued.”

Nitay Joffe: “ARR is still relevant, in a period of hype there is a lot of buzz around AI, I prefer to look at the quality of ARR rather than the quantity. I am looking for an entrepreneur who knows the market and understands it, I have had meetings with entrepreneurs where I sat with them for hours about the customer and understanding how successful he is”

Itamar Friedman: “What a client thinks is second in importance. ARR is very important but there are very important things like how I retain my customer and how I progress with him. I am also looking for the quality of the customer and not just the quantity.”

Would you prefer a client with many AI agents in one company or one in many companies?

Eyal Bino: “I always look ahead and how it generates income in the future.”

Itamar Friedman: “I’m always looking at how I build the client. Social media can change value overnight, what do we do with it?”.

Eyal Bino: “I’m very worried about buzz, so we’re very careful, I’m looking for different companies and therefore I’m not going into cyber, I don’t have enough money to compete there. We’ll focus on innovation, in companies like Remepy, which will change the world of healthcare. I’m looking for companies that understand the need for speed.”

Itamar Friedman: “I think we need to get involved and seize social media, how to harness the buzz to our needs, you need to create noise, be in the media, listen to what’s happening. We can’t ignore the media or what’s happening in it.”

Eyal Bino: “We need to think beyond social media.”

How do you distinguish between revenue and its quality?

Nitay Joffe: “You need to know what companies are doing with the product and where they are going and how they are creating scale beyond. When there is a technological change, you need to know how it happens and how you create success from it.”

Itamar Friedman: “It’s good to have a high revenue line, but it’s important to have another line that explains the revenue and details it, gives the revenue meaning and allows you to check what the strength is.”

Is gross profit in the AI ​​era comparable to SaaS companies?

Eyal Bino: “The world is changing but not completely, there are companies that generate revenue with significant gross profit and you can build on their revenue. The point is the product and how you build it further. I’m not sure that gross profit is significant and that’s less important to an entrepreneur.”

How do you test product suitability today compared to the past?

Eyal Bino: “Today, entrepreneurs already know at the beginning stage how many potential customers they have.”

Nitay Joffe: “I don’t think we’re changing the model yet, we’re in this process where everything happens quickly, the product changes quickly.”

Itamar Friedman: “I don’t think there’s one answer. There used to be approaches to getting customers, but take Cursor, which already has hundreds of millions of dollars in revenue. I don’t think there’s a right number today. You need a plan and a goal and a fund that believes in you. Even if you don’t have gross profit now, it will come very quickly with the revenue.”

Nitay Joffe: “I’m very excited about this period in which our models are changing shortly after the SaaS world. There will now be a new world of revenue that is not the same as the way we’ve seen revenue so far.”

Itamar Friedman: “Today, execution is the most important thing, the ability to execute and achieve revenue is above all else. A vision that is linked to this ability is equally significant.”

Nitay Joffe: “The ability to adopt AI is a significant part of execution and how you move ahead of the competition.”