James Bond - From Russia with love

From venture investment to strategic missile transport: Boston FBI warns US tech community of possible scams by “malicious Russian investors”

In a bid to “educate the private sector and raise awareness about economic espionage and cyber counterintelligence,” FBI special agents Lucia M. Ziobro and Vincent B. Lisi warned Boston-area businesses and academic institutions earlier this month of “scams involving malicious [Russian] venture capitalists.”

The warning took the form of a notification to local players and an op-ed published in the Boston Business Journal. The text urged those contacted by Russian venture capitalists “to remain vigilant and cognizant of the potential losses and compromises of company assets.”

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Russian money

Russian venture market: From euphoria to maturation

This month has seen the blossoming of venture analytics in Russia, with no fewer than four reports dedicated to the field. A study from PwC, with the support of state-owned fund of funds RVC, and another from investment company Rye Man and Gor Securities (RMG) offer general views of the market. Two other reports, published by venture fund and incubator Fastlane Ventures and East-West Digital News, provide narrower focuses.

Though their emphases and methodologies differ significantly, all four reports reveal the same trend: the fast growth of Russia’s venture market – which was embryonic just five years ago – has stopped; signs of maturation (or perhaps stagnation) are multiplying among most investment types and market segments.

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Visa Mastercard forbidden

Russia considers switching to national payment system after Visa, Mastercard block US-sanctioned Russian banks

Last week saw the international turmoil around Ukraine and Crimea affect Russia’s banking system, as the bank card operations of several US-sanctioned Russian banks were blocked by Visa and Mastercard.

Seven Russian banks were involved in the suspension, reported Russia Today, citing Timur Batyrev, head of the national payment system department at the Central Bank of Russia.

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Yandex acquires Israeli geo-location technology developer KitLocate

Today Yandex, the Russian search giant, announced the acquisition of Israeli startup KitLocate, the developer of an energy-efficient geolocation technology for mobile devices. The solution provides location capabilities, including geo-fencing, motion detection and social location, for location-based apps on the user’s iOS or Android smartphone.

Furthermore, it allows location-based apps to request the device’s geographic coordinates less frequently “without losing precision, which considerably extends the phone’s or tablet’s life between charges,” according to the startup. While doing this, last but not least, KitLocate’s solution consumes “less than 1% of battery power per hour.”

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Russian-American startup iBuildApp raises $525,000 to develop in Asia and Latin America

iBuildApp, a California-based startup with Russian roots, has raised $525,000 from Eugene Miller and Constantine Filin to further develop its mobile app building technology and expand internationally.

The iBuildApp platform allows anyone to build mobile applications for iPhone and Android without any programming skills. Templates are available for different industries, from banks and restaurants to universities, schools and churches. The app can be customized with additional texts, RSS-feeds, images, audio, video and more.

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E-commerce study

Russian e-commerce leaders Ozon and Ulmart in funding talks

Two leading Russian online retailers, Ozon and Ulmart, are holding discussions with investors to fuel expansion in a market that grew by almost 30% last year. Ozon, a pioneering e-commerce holding with notable similarities to Amazon.com, is in the final stages of talks with AFK Sistema, a Russian LSE-listed holding operating in a range of industries.

Little of these discussions has been made public, but the Federal Antimonopoly Service (FAS) recently confirmed to the Russian news agency Interfax that it had approved the potential transaction.

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Russian CPA platform CityAds raises $5 million with international ambitions

Klever Internet Investments, the technology branch of a major Russian private investor, Klever Asset Management, has received a minority stake in CityAds Media, a Moscow-based international affiliate marketing and performance advertising platform, in exchange for a $5 million growth equity funding.

CityAds, which is attracting private equity investment for the first time, intends to use the funds to scale its international sales, explore new verticals and fuel its proprietary technology development.

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Vkontakte shareholder drama continues: UCP to sue Mail.ru Group and Ivan Tavrin

The Vkontakte shareholder drama saw new developments yesterday as United Capital Partners (UCP), which acquired a 48% stake in the social network last year, announced that it is suing the company’s two other shareholders in Russian and international jurisdictions.

The Russian fund is accusing Mail.ru Group and Ivan Tavrin – who bought his 12% stake from Vkontakte founder Pavel Durov a few months ago – of “blocking the company’s development” and “taking decisions which are not in its best interests.”

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Russia’s first hardware startup accelerator launches in Kazan

While startup incubators and accelerators have been springing up like mushrooms in Russia over the past few years, this one deserves particular attention. It is the first such structure in the country completely dedicated to hardware projects – from consumer robotics to 3D-printing to smart electronics for “smart home” systems and wearables.

The accelerator, christened Navigator Campus, opened this past Saturday in Kazan, the capital of Tatarstan, 800 km from Moscow. It is 100% privately owned, in contrast to all the other incubators, accelerators and technoparks of this innovation-friendly republic of the Russian Federation, as co-founders Ramil Ibragimov and Vasil Zakyev told East-West Digital News.

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Travel metasearch engine Aviasales secures $10 million from iTech Capital

iTech Capital, a Russian PE & VC fund, announced today an investment of $10 million in Aviasales.ru, a leading search engine for flights and hotel bookings. The terms of the deal have not been disclosed, but the fund told East-West Digital News that it had obtained a stake of less than 30%.

The company – which is attracting venture money for the first time – will invest in developing its key products: the Aviasales Russian search engine and its international version, JetRadar – a Thai version of which was launched recently – as well as the Hotellook hospitality project and the Travelpayouts affiliate network.

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East-West Digital News is published with the support of:
  • Higher school of economics
  • The Institute for Statistical Studies and Economics of Knowledge
  • Russian Venture Company
  • Territory of tomorrow foundation