Silicon Valley experts mind hunter across Russian startups
Starting your own business is not easy, especially when the world is gripped by financial crisis and you live in a country which international investors look at with suspicion. But here’s where guys from California come in.
A Silicon Valley based Entrepreneurship school – Startup Monthly – have spent two weeks in Moscow choosing interesting business projects to bring them to the US innovation hub in Northern California. The heads of the project, Vadim Slavin and Yuri Rabinovich, both have a Russian background. But it’s not just a call of blood, but it’s the belief in the abilities of young Russian businessmen that drives them, as well as an easier – to –understand Russian mentality.“There are no such a tremendous gap like with Japan, for example, where people can’t afford to make a mistake, while in Silicon Valley companies take failure as an award, a sign of their effort and will,” explained Vadim Slavin, COO at Startup Monthly.Yet, they realize that Russians still need some training to deliver American start-up practices.“We change the way people think to make them more flexible and innovative by using our methodology to verify the idea,” said Yuri Rabinovich, the CEO at Startup Monthly.Startup Monthly helps to create a model product with the basic set of characteristics, or “a minimum product”, which allows a test of the business idea and an understanding of whether it needs to be developed any further, explained Slavin to Business RT.And since the internet has become the first and the foremost global link, the competing projects dealt mostly with web facilities.ClipClock enables users to mark and share with friends the best moments of any YouTube video seemed to be the best positioned idea to the Silicon Valley experts. Social application Glomper based mostly on Facebook facilities to create an alternative view of social events – comments, pictures and location of friends, as well as a software Care4Teen that gives parents control over their children’s online activities, were also among the most attractive startups.Overall, 5 Russian projects were invited to take part in the coming July startup accelerator in San Francisco’s Silicon Valley. Once a Russian team pays a fee to Startup Monthly, and makes sure it has enough money for 2 months in the San Francisco area, they’ll get accelerated access to Silicon Valley and its venture capital.After the education course Startup Monthly helps “with establishing their business development and marketing departments in theUS,” Rabinovich said. More specifically, “the best teams will get investment from Monthly Ventures in the range of $100,000 – $500,000 as a co-investment with our partners in Silicon Valley,” the Startup Monthly boss concluded.Introducing a startup directly to a foreign investor is the basic practice for venture business, Lyubov Simonova, an expert from Almaz Capital, explained to Business RT. “In case of startup projects it’s the team that matters more to an investor than just an idea. So, an investor needs to meet with the team in person to make sure he’s going to give his money to responsible people,” she said. But big investment companies are often cautious about spending money on baby-startups, even if they demand little investment by big fund standards, for instance up to $500,000. Many admit they would rather invest more in a business that is already running and has signs of success. The niche for small companies is being filled by companies like Startup Monthly, Russian business incubator Farminers and the Greenfield Project, who try to create a platform for communication among hi-tech startups and their potential investors. There are a few projects like that in Russia and many of them find it difficult to attract money.The poor Russian investment climate comes as a huge additional stumbling block, adds Nadezhda Nesterova, Head of Investor Relations at Venture Investment and Yield Management. “Given a common lack of trust in the Russian economy from international investors and their fear to bring their money here, attracting venture capital to Russia directly looks especially difficult,” Nesterova told.But if companies chosen by Startup Monthly prove successful, the hope is their story will attract more investors. The guys from California are planning to come back in September when the next batch of startups will be selected.Business RT: Anastasiya Kostomarova