Russia is now the largest internet market in Europe, with more than 55 million online users, and an online market that is still in a massive state of growth, and a new frontier for US and German venture capitalists looking for the next big win.
The online ad spend in Russia was valued at $1.4 billion last year and is expected to mushroom to more than 40 percent in 2012. Among the hottest market trends is the fact that modern Russians book travel and shop mostly online. Some of hottest tech on the web still comes from Russian engineers thanks to their strong educational background, plus the massive interest in the Russian tech scene following the successes of famous VC Yuri Milner. Here are the hottest web startups from Russia, Europe’s largest internet population:
Having raised $15 million in venture capital from Mangrove Capital Partners, Ventech and VTB Capital, Oktogo.ru is Russia’s leading online hotel booking and travel site. The ‘Booking.com of Russia’, Oktogo.ru has not only collected the largest online hotel database in the country, but also baked it with TripAdvisor‘s user reviews. Oktogo.ru CEO Marina Kolesnik is one of the most visionary female internet entrepreneurs from Russia.
Flight online booking site Anywayanyday.com has more than tripled its annual revenues to $192 million in 2011. The online site sold half a million airline tickets last year. It recently added online hotel booking. Back in 2008, Anywayanyday raised $10 million in venture capital from Tiger Global. What is next for Anywayanyday? It could very well IPO very soon.
With a $30 million new funding from Tiger and Russian investors, Wikimart.ru strives to become the leading online shopping mall in Russia. It invests in own fulfilment centers to be a preferred option for small and medium-sized Russian online merchants.
ZeptoLab (Cut the Rope)
Russia’s answer to Rovio‘s “Angry Birds”, ZeptoLab‘s “Cut the Rope” has reached over 100 million game downloads on iOS and Android. The UK and Moscow-based ZeptoLab also released a “Cut the Rope” sequel. The company leverages its Om Nom game character by branching out into comic books, plush toys, board games and kidswear via merchandising deals.
While it’s hard to beat Microsoft, Russia’s Nginx did it. The lightweight, high-performance web server, reverse proxy and e-mail proxy software provider Nginx is the #2 web server software on the Web, behind only Apache. Founded by one of Russia’s leading online portals, Rambler‘s engineer Igor Sysoev, Nginx raised $3 million from BV Capital, MSD Capital and Runa Capital to make its free web server a commercial success.
Funded by Moscow and Berlin-based Runa Capital, a California and Russia-based Jelastic offers Java hosting platform-as-a-service (PaaS). Having just become commercially available in Europe and the US, Jelastic PaaS significantly saves costs for Java application customers.
While Siri is your default personal assistant for iPhone 4S, the Russian-born Speaktoit Assistant is one of the best choices for a personal assistant on Android devices. With over 1.4 million downloads and growing, Speaktoit has a 4.6 rating out of more then 25,000 user reviews on Google Play (Android Market).
Started in late 2009 as a seed investor and publisher for social game development studios from Russia, Game Insight claimed $50 million revenues from social and mobile games last year. Being one of the leading game companies on Android with titles like Paradise Island, Moscow-based Game Insight is now heading to the US market with a publisher model.
Launched in St. Petersburg in September 2009, online school service Dnevnik.ru has signed up more than 17,000 schools and 2 million school children in Russia. Dnevnik.ru raised $1.7 million from Prostor Capital last year.
Launched by Russian-German Oskar Hartmann in late 2008, KupiVIP.ru has raised $86 million in total from Accel Partners, Bessemer Venture Partners, Balderton Capital, Mangrove Capital Partners and Russia Partners. The leading Russian online shopping club KupiVIP.ru, which has over 7 million members, has become an e-commerce platform for large retailers like Tsum and launched online store ShopTime. Its latest project is the model agency New One model management.