Central regions | Finance, business | Technology & innovation
New Russian fund to invest globally in high tech start-ups
19 Mar '13
In a new illustration of the vibrant activity of the Moscow venture scene, Maxim Shekhovtsov and Alexander Zhurba – founders of TexDrive, one of the city’s largest start-up accelerators – have set up a fund dedicated primarily to IT projects in Russia and around the world, East-West Digital News, the international resource on Russian digital industries, reported yesterday.
Christened Genezis Capital, the fund actually launched and made its first investment in late 2012 – but the official announcement was delayed to take advantage of the most suitable moment for it, Zhurba said in an exchange with East-West Digital News.
Genezis was put together by a group of more than 30 limited partners, representing investment banking, PE funds, large-scale multinationals and just “wealthy people.”
The amount of the fund – which is still open to new LPs – has not been disclosed. But Genezis sources have stated that it has raised enough money to invest in three to five seed or early-stage companies every year, with each receiving from $25,000 to $1 million, and in two more mature start-ups for as much $20 million apiece – and this for at least two years running.
IT projects are expected to account for up to 70% of the fund’s investments, with the rest possibly allotted to beefing up players in biotech, clean tech, energy saving, alternative energy and robotics.
A global focus
In Russia, Genezis works as an extension of TexDrive, managing the accelerator’s assets. Its playing field has been rather narrow, with no more than 70 investment-grade start-ups in the country, the fund has estimated.
But Genezis – which was registered in an as-yet unspecified foreign country – seeks investment opportunities across markets as diverse as the U.S., Europe, Russia and Asia. “We consider Russian and foreign start-ups under identical criteria,” Zhurba told EWDN.
The invest abroad trend among Russian funds started in 2009, when Yuri Milner’s Digital Sky Technologies invested in Facebook. Since then, a bevy of Moscow-based VCs, including Bright Capital, Phenomen Ventures, Runa Capital and Ru-Net, have been chasing opportunities around the world, while DST’s cash has fueled Airbnb, Alibaba, Spotify, Twitter and several other top Internet companies.
Genezis Capital’s first investment – more than $10 million – went to an undisclosed company operating in the U.S. and Western European markets. Its Russian portfolio includes B-152, an Internet service that helps businesses comply with the demanding requirements of Russia’s personal data legislation; Martmania, a Novosibirsk, Siberia-based online retailer; and Fleecs, a start-up developing a payment solution for fuel stations.