• the Russian investors from Europe
• the up and coming European BNPL startups
• is a highly overpriced deal the best startup Europe can produce?

 

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Observations

In the light of the current events, I thought it'd be interesting to have a look at who is who in the lil' investment ecosystem from Europe in terms of Russian investors. Here's what I found:

• Target Global - kicked off in 2012 by Alex Frolov, Mikhail (Mike) Lobanov and Yaron Valler with a 300 million late stage fund backed by Russian investors (one of them is Invest AG - owned by Frolov Sr and another Russian oligarch). The latter founder is an Israeli engineer who had previously done VC for Hasso Plattner while the first two are Russians who went to the same school - LSE - and then Mike worked for Alfa Capital in Russia while Alex did an MBA at LBS and an internship at Draper in London.

Target Global is officially based in Berlin - Alex and Yaron are both in London, Mike in Nicosia and there's no public Russian connection on their site. But they were certainly affected by the current market adversity as they have people involved in other vehicles active in Russia.

• DST Global - one of the better known Russian investors in the world, active at late-stage with an amazing record, and founded by Yuri Milner in 2009 on the basis of Mail.ru (now VK, the largest internet company in Russia). Now DST changed its homepage entirely (wikipedia too), eliminated any Russian connection from the copy (they're HQ-ed in Moscow, that's edited out now) and even had Marc Andreessen publicly endorse Milner. 

• RTP Global - early stage VC with global reach, founded under the name ru-Net in 2000 by Leonid Boguslavsky, who specifically mentions that he made his own wealth from VC investments and who, among others, was friends with the late oligarch and Putin enemy Boris Berezovsky. RTP also edited out any Russian mention from its website.

• Digital Horizon - Russia-based seed/series A VC founded at the end of 2018 by Israeli Alan Vaksman, who previously worked for Gazprombank and mail.ru in Russia. The Moscow office is now gone from their site.

• Baring Vostok - the largest independent PE firm out of Russia, founded in 1994 by Michael Calvey, who, funnily enough, in 2019 colluded with Putin's money puppets and faced legal consequences. Their site is unchanged.

• InVenture Partners - VC fund founded in 2012 by Sergey Azatyan, active at all stages in all geographies. The location origins is gone from their site.

• Sistema VC - originally founded on the back of some media assets acquired in the 90s by Russian oligarch Vladimir Yevtushenkov. It was relaunched as an investment fund led by Alexei Katkov in 2015, and is now part of Sistema group, one of the largest Russian conglomerates controlled by the same Yevtushenkov (FT has a good profile of him).

• Redline Capital - founded in 2014 by Tatiana Evtushenkova, daughter of the above-mentioned Vladimir Yevtushenkov, registered in Luxembourg and fairly active at early stage both in Europe and US. Tatiana's name was removed from the website, alongside all the people working for the fund.

• Rider Global - Moscow-based early stage VC, founded by Timur Boridko, Alexander Yeliseyev and Denis Lesnykh in 2018. Their website is out altogether.

• Xploration Capital - VC fund founded in Moscow by Eugene Timko in 2017, focused on seed/series A/series B. They have done more than a dozen of investments since then and, coincidence or not, Timko updated his Linkedin profile as working for Abu Dhabi-based late stage investor Mubadala as a venture partner since February 2022.

• Impulse VC - founded in 2013 by Kirill Belov and backed by Roman Abramovich, also active early stage, their website is just a placeholder now.

And then there's a bunch of other Russian vehicles operated out of Cyprus, Europe's fiscal paradise and the usual go-to-route for Russians looking to invest or simply acquire the EU privileges via a golden visa. Examples include Winter Capital, Matrix Capital, Addventure or Optimum Strategy.

The list is by no means comprehensive or representative for anything, rather orientative - take it as very small sample of Russian investors who did deals in the startup market in Europe, still a small asset class in a decent portfolio. Over at Nordic 9 we have north of 100 such names, even though we don't particularly track Russian dealflow.

Btw, if you find this newsletter useful and would like to support my work, becoming a paying member over at Nordic 9 would be greatly appreciated. Thanks.

 

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Cheat sheet and intel reports

Fintech in Europe
• what are the up and coming BNPL startups in Europe
• multiple early stage fintech deals showcasing web3
• early stage funding push for embedded finance solutions

This is what you can find in our last intel update sent to our N9 customers this week. You can subscribe for getting it in your inbox alongside access to tons of Euro data and insights from here.

The most expensive early stage startups from Europe
Only a week till the next Y Combinator demo day (March 29-30) - Europe has 34 startups presenting: 
🇬🇧 UK - 12 startups
🇫🇷 France - 5 startups
🇩🇪 Germany - 5 startups
🇳🇱 Netherlands - 3 startups
🇸🇪 Sweden - 3 startups
🇪🇸 Spain - 2 startups
🇩🇰 Denmark - 1 startup
🇫🇮 Finland - 1 startup
🇳🇴 Norway - 1 startup
🇨🇭 Switzerland - 1 startup

Who are they and why are they interesting - link

Web 3 startups and investors in Europe
• Interesting web3 startups funded in Europe last fall - link
• Non-web3 investors which made at least a couple of web3 deals In Europe last year and their deals - link.

The hottest 160 early stage startups from Europe
We have reviewed more than 2000 early stage deals made in 2021 and profiled 160 interesting startups that are in the market raising money now:

🇬🇧 UK (40 startups)
🇩🇪 Germany (35 startups)
🇫🇷 France (30 startups)
🇸🇪 Sweden (20 startups)
🇩🇰 Denmark (15 startups)
🇫🇮 Finland (10 startups)
🇳🇴 Norway (10 startups)


Note: the reports are available for Nordic 9 paying customers only. You can become one from here.

 

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The 6.5 hours dinner gap

 

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Notes

🇹🇷 What can you do with 800 million? Getir raised almost $800 million at $11.8 billion valuation, a highly overpriced deal for an aspirational leader in a crowded category. That is 1.5X Wolt, acquired for 8.1 billion 5 months ago - just by a superficial look at it, Wolt is an established business doing both grocery and restaurant delivery active in 23 countries while Getir is just getting started with business in only 9 countries. Even though the market upside is there (a reason to justify the spending exuberance in a wary market) it is a highly competitive environment in a quasi-mature industry - so it's all about execution for Getir now, the 800 million gives them optionality as they need to expand fast both in scale and scope in order to prove themselves.

But it makes you wonder - with all this money available for startups, is this the best Europe has gotten?

🇩🇪 Related - Gorillas:
• avg order value ~23€.
• contribution margin -6€.
• burning 1.5M€/day  
• CTO and other executives already out
• culture apparently toxic.
• ... but they’re really great at fundraising.

Bonus read: the worst business model ever created was rapid grocery delivery.

🇬🇧 Regulated tech. The Brits have a new proposed bill that says the executives at companies like Meta, Google, Twitter and TikTok could face jail time if they fail to cooperate with the local regulators. The senior managers at tech firms will also be criminally liable for destroying evidence, failing to attend or providing false information in interviews with Ofcom (the Brit regulator), and for obstructing the watchdog when it enters company offices.

🇪🇺 More regulation. It looks like Europe’s anti-Apple bill will pass easily, and there are two provisions in the bill which have the potential to directly affect the App Store: 1) Side loading and 2) Third party payments. The second one is super sensitive to Apple as explained here - non-compliance with the bill will reportedly incur a fine of 10% of annual revenue. Apple did $366 billion last year fwiw.

🇪🇸 The work/life balance is a myth. Citigroup announced that it is founding a hub for new junior investment bankers in Malaga, who'd get paid 50k at junior level (that's half than whet they'd get in London/NYC) for doing work 40 hours a week. That can be great but can you do business in a vacuum, just Zooming people? In terms of hanging out and social life, which means business in IB, apart from the usual tourists, the whole region is full of Russian oligarchs and Swedes playing golf.

🇷🇺 The reality on the ground. Good interview with a Russian economic analyst about the real Russian society:
• the economic impact for the sanctions will likely hit April 10-20
• most impacted will be the middle class (defined as people w/ a passport), estimated to be around 6 million (out of 144M in total). The 44 million thought to be poor or at the edge of poverty won't be affected as much. Most people in Russia work for state-owned orgs.
• there's huge societal segregation by city/raion/area - for example, salaries in rural areas average 40-70 euro a month while in Moscow the starting salary is $1k. Moscow and satellite areas account for 22 million people - for benchmark, London has 9 million souls, Berlin 3.6 and Paris 2.

🇪🇸 Jaime Novoa, who already has a good newsletter for staying updated with the Spanish ecosystem, just put together a Notion project with all sorts of insights about the local deals. 

 

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Watercooler talk

🇺🇸 Americans in Europe. Sarah Cannon is yet another American crossing the ocean for the good European life - she will work for Coatue to build the London office, after having resigned from being a partner at Index Ventures at the end of last year.  

🇨🇭 Credit Suisse developed a matchmaking platform to connect investors and start-ups in Switzerland - they call it a pilot and if it sticks they will figure out a business model.

🇬🇧 ClearBank - the UK’s first new clearing bank in more than 250 years - raised £175 million from Apax Partners.

🇸🇪 Spotify is looking to hire people to do NFT and digital collectibles and bought naming rights on FC Barcelona’s stadium - Spotify Camp Nou.

🇮🇹 Clearview AI was fined for €20 million for implementing a biometric monitoring network in Italy without people’s consent.

🇪🇺 Intel committed itself to Europe - big time. Same for Amazon to the UK.

⚽ Chelsea has attracted interest from more than 20 investors - who are they? 

🇷🇺 Yandex explores selling its media business, and switch focus to tech-related products and transactional services. Yandex is listed on both America’s Nasdaq and Russia’s MOEX, which was closed for the past 3 weeks.

🇺🇸 Slack, which is owned by Salesforce, announced setting up $100 million fund (its third) to invest in tech startups. That number is higher than the average European fund size.

✈️ Airfares are going up because the travel demand is unprecedently high.

 

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Readings

🌲 Swedish forest as an asset class.

🌿 The plant protein primer - link

🤔 A vibe shift is coming - will any of us survive it?

👀 Bioregions are areas with their own ecologies and cultures, in which humans and other species are rooted, actively participating at various scales beyond the immediate locale. Could they replace nation-states?

⌚ Smartwatch market grows 24% YoY in 2021, records highest ever quarterly shipments in Q4.

🇨🇳 Fintech in China - the development and China’s strategies for the fintech sector in 2022-2025.

🚗 Range anxiety and charge times are among the top reasons that consumers avoid EVs - an American story.

🦾 Public purpose technology - what is it and why does it matter right now?

🇷🇴 Solving Europe's labor problem, the Romanian chapter - as Western European countries solved their labour shortage by recruiting millions of Romanians and other Eastern European citizens, Romania is now finding itself in a similar situation and importing thousands of Vietnamese, Indian and Nepalese to fill the void.

 

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How's your week been?

🤘 Is $3,300 a month enough to get by in London? Asking for an oligarch.

❌ Are you even a doctor if you're not a Doktor Doktor? In Germany a medical doctor with PhD who is also a university professor is called Frau Professor Doktor Doktor.

🇬🇧 How Putin's oligarchs bought London - it's easy to buy respectability if you have enough money.

🇷🇺 Oligarchs - what's the difference between a "normal" billionaire and a Russian "oligarch"?

🇺🇦 Opportunistic trademark. Ukrainian Snake Island soldier seeks trademark for the “go fuck yourself“ term in both Cyrillic script and English. 

🔗 Over 400 companies have withdrawn from Russia - but some remain.

🇳🇴 A Russian ship owned by Vladimir Strzhalkovsky, a former KGB agent who has long been linked to Putin, is unable to leave its dock in Norway because no one at the port will sell it fuel. Strzhalkovsky is not currently being sanctioned by Europe or the UK and the yacht's crew is not Russian. link

🤡 Kanye West was suspended from Instagram for 24 hours for being an idiot.

 

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