In October 2008, Itschak Friedman bought more of the company he had spent two decades building. STARLIMS shares had fallen a long way from their Nasdaq offering price. The company had issued a profit warning. Friedman and his brother Chaim, its chief financial officer, each bought another 180,000 shares that month. Together, they spent about $1.5 million.
There is a convenient version of a founder’s life in which the first idea leads briskly to the successful sale. Friedman’s version includes a geology degree, laboratory software, two stock exchanges and the experience of watching a public market put a sharply reduced price on his work. The briskness is supplied later, by whoever writes the biography.
In March 2010, Abbott acquired STARLIMS for approximately $123 million, at $14 a share. Between the falling price and the sale sits the more interesting story: a founder learning to build something useful, sell it across borders and keep operating when the stock chart became an unhelpful colleague.
A geology degree, then a different kind of groundwork
Friedman studied geology at the Hebrew University of Jerusalem. His eventual business would involve scientific information, although the object of attention had moved from the earth to the systems that organize laboratory work. STARLIMS was founded in Israel in 1986. Friedman became its chairman and chief executive in 1988, and also served as president of its American subsidiary.
He occupied an unusually broad set of seats. Alongside the executive titles, he was STARLIMS’s chief architect. That combination placed product design and commercial responsibility in the same career. The software had to make sense to the people using it; the business had to persuade institutions to pay for it.
A laboratory information management system, usually shortened to LIMS, handles the records surrounding samples and tests. It organizes information as it is collected, processed, stored and retrieved. In manufacturing and quality control, the record can matter long after the original test. A result without its surrounding history leaves an awkward amount of explaining to do.
Friedman’s colleagues brought distinct experience. Dinu Toiba, a STARLIMS co-founder, held mathematics degrees from the University of Bucharest and led research and development before becoming chief information officer. Chaim Friedman, Itschak’s brother, had studied economics and management at the Technion and served as chief financial officer from 1989. The family connection was real; so were the separate jobs.
The paperwork had a product problem
The business offered a practical bargain. Laboratories could use software to keep their information accessible and their processes traceable. The customers included government bodies and manufacturers, organizations with substantial demands and little reason to be charmed by a clever demonstration that failed during everyday work.
For Friedman, growth meant carrying that bargain into different markets. STARLIMS went public in Tel Aviv in 1993 and on Nasdaq in 2007. By early 2008, the business served more than 500 organizations in 40 countries, with operations in the United States, Canada, the United Kingdom, Israel and Hong Kong. The product had acquired an international working life.
One particular problem attracted the company’s attention: documents. A laboratory could have orderly database records while reports, spreadsheets and instrument files remained scattered elsewhere. A neatly kept database could still be surrounded by a small republic of unruly files. Bringing those materials together was an opportunity to make the system more useful.
In February 2008, STARLIMS announced that it would introduce scientific document management capabilities at PITTCON in New Orleans. The module was designed to capture, search, share and archive documents alongside laboratory data. Friedman described the ambition in terms of connecting the laboratory with the wider enterprise.
“The release of STARLIMS SDMS is a crucial step forward in our vision of unifying laboratory, scientific and enterprise information.”
Itschak Friedman, February 2008
That wording gives a fairly precise account of his product agenda. Information should remain useful beyond the application that first captured it. The promised improvement involved collaboration across an organization, as well as the immediate business of managing a test. It was an expansion of the customer problem STARLIMS was prepared to tackle.
There was another consequential change in how the product reached its users. In March 2006, STARLIMS introduced Version 10, developed as a web-based system. Customers could manage laboratories spread across different locations. The company still sold perpetual licences for installation on customers’ servers. A browser-based interface and a subscription business are separate choices; STARLIMS’s approach combined the former with an established licensing model.
That detail places Friedman’s work in its own period. Building software for an institution meant accommodating the institution’s systems, purchasing decisions and requirements. A product could become easier to access without requiring its buyer to adopt every new commercial fashion at once. The technical change had to travel through an existing business relationship. For a founder who was also chief architect, the architecture and the sale were parts of the same practical problem.
Two large orders, then an uncomfortable autumn
The opening months of 2008 gave Friedman reasons to sound pleased. STARLIMS signed two deals worth more than $1 million apiece in the first quarter. Quarterly revenue reached roughly $7 million, up 28.9% from the same period a year earlier. Its average selling price on direct sales rose above $800,000, helped by those two orders.
Those figures also reveal the rhythm of the business. A small number of sizeable decisions could materially affect a quarter. Enterprise customers were buying something substantial enough to require services, implementation and continuing support. The financial results included both product and service revenue; the work continued after the contract was signed.
By October, the public picture had changed. STARLIMS had issued a profit warning, and its shares were trading far below the $13.50 price of the 2007 Nasdaq offering. During that month, Itschak and Chaim each made two purchases: 50,000 shares at $4.87 and another 130,000 at $3.90. Itschak’s holding rose to about 1.54 million shares.
The purchases are a concrete episode in a career otherwise often compressed into titles. They show the brothers increasing their financial exposure while the market was marking the business down. They do not require an invented boardroom speech, a midnight revelation or a heroic expression. The orders themselves carry the scene.
The buyer first came to talk business
Abbott’s approach began in December 2008 with discussions about possible commercial cooperation. Friedman was among the STARLIMS executives involved. Technical and market assessments followed, and the conversations developed into acquisition negotiations in 2009. A potential partner had become a potential owner.
The distinction matters to the shape of the story. STARLIMS had a product and an installed customer base that another company wanted to work with. The eventual sale grew out of examining that fit. A transaction price would settle the ownership question, but the underlying subject of the discussions was what the software could do.
In December 2009, the parties signed an agreement at $14 a share. The acquisition was completed in March 2010. For a business founded in 1986, the sale came nearly a quarter-century after its beginning. The interval is long enough to accommodate several generations of software, along with considerably more meetings than any founder photograph suggests.
Friedman was to continue leading the STARLIMS team after the acquisition. At the announcement, he spoke about serving existing customers and making the technology available to more laboratories around the world. His stated ambition remained attached to the product’s reach. The sale changed the owner while leaving him with operating work to do.
From running the company to helping the next one
The relationships formed around STARLIMS continued into Friedman’s investing career. At LionBird, he worked alongside Chaim and Ed Michael, the former Abbott executive. Michael had been on the acquiring company’s side of the STARLIMS story. Their later association put experience of building a software business and experience inside a large corporation in the same investment firm.
By 2016, LionBird was preparing a second fund after its first fund had raised $20 million in 2013. Its early investments included Fundbox and Genome Compiler. For Friedman, this was a different position in the company-building process: helping other founders make decisions rather than carrying the chief executive’s title himself.
Today, LionBird lists him as a venture partner. He leads its advisory councils, assisting portfolio companies with product ideas, technology roadmaps, initial sales and delivery. That sequence closely resembles the demands of his earlier operating career. A product must be conceived, built, bought and put to work. Each verb can introduce difficulties the previous one did not solve.
The advisory remit is specific about delivery, a word that deserves its place beside sales. A contract establishes a commitment. Delivery is where the customer encounters the consequences of the design decisions. Friedman’s current responsibilities extend across that boundary, giving the next generation of founders access to someone who has held responsibility on both sides of it.
His public comments on LinkedIn continue to emphasize commercial evidence, including customers who keep buying and remain with a business. Read alongside the STARLIMS years, that emphasis has a clear continuity. The first order matters; so does what happens when the customer starts using the software and decides whether to stay.
The $123 million sale supplies the memorable number. Friedman’s present work returns to the smaller decisions that precede such a number: what to build, which customer to approach, how to deliver the promise. The founder who bought more shares in an uncomfortable autumn now helps other founders get from an idea to a working business. There is still a product to get out the door.