We talk to startups and investors, you get the value.
We talk to startups and investors, you get the value.
Whereas at the beginning of 2010 we spoke of Belarus as an industrial potash giant and a heavyweight Dakar Rally raids conqueror thanks to its MAZ titans, today the “blue-eyed” is more often seen as a “Silicon Valley” of Eastern Europe making progress on the international stage every year.
It all came true due to startups popping up like mushrooms every year. The word "startup" has long ceased to be just a Western curiosity. Investors with foreign capital are increasingly looking at Belarus in the hope of boosting their capital through the complex projects and technologies invented by Belarusian IT developers.
When a project is still in the initial stage, it is hardly possible to determine its outcome — colossal success or disastrous collapse. Nevertheless, a thorough examination and analysis of Belarusian ecosystems and overall trends is an excellent assistant when it comes to indicating key areas, finding a niche, knowing competitors, assessing and minimizing risks associated with fluctuations in the IT market, etc.
At the moment, the business ecosystem and the IT industry itself in Belarus are experiencing a recession due to the global pandemic and the political crisis, both within the country and throughout the entire world. As a result, investment activity has decreased and suffers losses up to millions of dollars. Thus, according to StartupBlink, in the list of startup ecosystems Belarus lost four positions compared to 2020 and took 67th position (out of 100) on the planet, and 18th position among Eastern European countries. Its capital, Minsk, took 230th place (out of 1000). However, the country still has significant growth potential thanks to its talented entrepreneurs and skilled workforce.
Among the fields that received the greatest development and became the main drivers of investment and financing growth are enterprise software, security, and e-commerce, that have brought a total of $150M of investment capital according to Belarus Startup Report 2021. In addition, areas such as telemedicine (health & wellness segment), media, and fintech are currently on the rise. The demand for them will continue to rise.
It should be noted that active development of the IT sphere in Belarus in previous years became possible due to the growth of startup infrastructure, namely the emergence of various business incubators, coworking spaces, event spaces in the center of Minsk (Global Entrepreneurship Week in Belarus (GEW Belarus), EMERGE, Startup Weekend Belarus), etc. By 2020, there were about two dozen business incubators and coworking spaces sharing premises for meetups and training events for professional education and providing an access to participation in the venture capital market and specialized conferences. Among others, the major incubator Demium Startups and the Imaguru hub are worth mentioning. Imaguru, in turn, with the assistance of USAID (United States Agency for International Development) helped launch the first accelerator in Belarus — TechMinsk Accelerator.
The list below outlines large startups in Belarus that adapted to the crisis and made themselves known. The list includes but is not limited to the data of the survey of September 2020 (with a series of post-interviews in October and November) among Belarusian startups of different stages, levels, industries, shares, profit margins, and metrics. The survey was provided by the Belbiz group of companies within the framework of the API venture project for the development of the venture capital ecosystem in Belarus with the support of USAID.
Five years ago Sergei Gonchar, Evgeny Nevgen, and Evgeny Zatepyakin wrote a story that many start-up entrepreneurs dream of: to create a “Masquerade” project, appear in the press, attract more than $1M in the seed round of investments in February 2016, and sell it to Facebook in March. With “Masquerade” you can apply frames and masks to your face, for example, during online calls: beard, celebrity face, flowers in the hair. Countless masks allowed users to change their look, and the project quickly won the hearts of selfie and augmented reality lovers. Facebook closed MSQRD in April 2020, but its team has continued to develop Facebook's Spark AR technology, a platform for creating masks for Instagram and Facebook.
A non-trivial sleep health product from the MSQRD creators. It helps to get rid of stress and tension accumulated throughout the day, and, once in bed, tune in to a healthy sleep. Combining visuals, musical accompaniment, user interaction, and storytelling, the project is a beautiful fairy tale-coloring in 3D format that transfers users into a magical universe of games and dreams. It is worth noting that at the end of 2020, Loóna was named “Best App of the Year” by Google Play, and in June 2021, it became the winner of the Apple Design Awards.
A universal software that was developed in 2011 and is one of the best document management tools nowadays. The PandaDoc product allows you to automate document flow, negotiate and sign offers, contracts, and agreements. This software became an official add-on to Google Docs and Google Sheets. The founder of the company Mikita Mikado is one of the good examples of Belarusian entrepreneurs who created a successful business in the United States and became the hero of Yuri Dud's film about Silicon Valley. In September 2021, PandaDoc closed a series C funding round with more than $1 billion investments.
One of the most popular women's health and wellness apps released in 2015. Flo, a universal menstrual cycle and ovulation calendar tracker, is one of the top health apps in terms of downloads: Flo has been downloaded by more than 200 million users worldwide, and has over 1.5 million paid subscribers. The application was launched by Belarusian businessmen — Dmitry and Yury Gursky brothers (IT businessman and co-founder of the Haxus Fund, former vice president of Mail.ru Group, respectively). In September 2021, Flo closed a series B funding round. The total investment amounted to $50M, whilst the company's valuation reached $800M. The investments will be used for the development of the application and the expansion of the team. The company plans to employ 400 people worldwide by the end of 2021. More than half of them will work in the company's European offices.
An agro-tech startup, launched in 2017, develops applications and an online platform for farming. With its help, farmers can monitor their own areas, increase yields, and save resources. The products are based on Landsat and Sentinel satellite images, which are in free access, data from their own aircraft (drones and a gasoline helicopter) and various sensors installed on tractors and combines, machine learning algorithms, and Big Data analysis. At the moment, according to the startup, 5% of the world's total arable land is registered in the application, it is used by more than 200,000 farmers and agricultural specialists from 180 countries. In 2021, OneSoil raised $5M in the round A from Venture Capital Funds Almaz Capital and PortfoLion. Earlier, the startup has already raised $1.5M.
The company, founded in 2016, creates programs to simplify work with Big Data using natural language interfaces. The FriendlyData application allows non-technical specialists to collect, request, send, and receive information necessary for decision-making in natural language, and, thus, improve their work efficiency. In 2017, the team was selected for the international accelerator 500 Startups and received $150,000. Starta Ventures, TMT Investments, Bulba Ventures and others also invested in the startup. In autumn 2018, FriendlyData was acquired by the US company ServiceNow, developing a cloud platform business processes optimization and occupying a leading position in the Forbes innovation ranking.
A startup Vochi (we wrote about it here and here) develops and monetizes applications, projects, and products based on artificial intelligence, machine learning, computer vision, and innovative technologies for video processing. It adds effects to necessary parts on a mobile phone without losing quality. In summer 2021, the Belarusian startup raised additional $2.4M from investors in the late seed round. Prior to that, last year, the Ukrainian Venture Fund Genesis Investments invested $1.5M in the project. In December 2021, the social network Pinterest announced the purchase of Vochi. The deal should give users more tools to work with the content. Currently, the application is used by more than 500,000 people a month, and the annual income has reached more than $4M within a year.
The startup, founded in 2020, develops no-code systems that help companies come up with solutions managing their processes. Thus, Fibery provides various whiteboards, tables, calendars, graphs, lists, command buttons, and more. The service is perfect for product managers and analysts, companies working with large databases. In 2021, the start-up managed to raise $3.1M in the Seed Round led by Altair Capital.
A mobile platform with short interactive educational videos for young people on a wide variety of topics — sports, fashion, art. Visually, the application resembles a feed on TikTok or Instagram, which is generated depending on the user's preferences. With EduDo, each user can leave reactions and comments, as well as create content on their own. In December 2020, EduDo was named the Product of the Week at Product Hunt, and became a Golden Kitty Awards winner (celebration of the best of the best products of the year launched at Product Hunt) in the mobile app category. In addition, in the spring of 2021, the startup raised a SAFE round of investments in the amount of $300,000 from the Ukrainian Venture Capital Fund Adventures Lab, the Cypriot company Embria and business angel Dmitry Vasiliev. And recently, on November 15, 2021, the guys made an updated release: EduDo 2.0 turned into a platform for asynchronous discussions in video format.
10. Rocket Data
A platform that updates data about companies and their business on the most popular online services: services with reviews, maps, directories, social networks. RocketData personal account provides a convenient interface for managing information about a company and its reputation. In the spring of 2021, the “2GIS” mapping service, a part of the Sberbank ecosystem — one of the largest geoservices in Russia, Kazakhstan, and the United Arab Emirates — acquired 47% of RocketData. Subsequently, 2GIS plans to increase its stake to 88% by purchasing the stakes of investors, including the stakes of the Russian-Belarusian Venture Capital Fund at the first and second stages of the transaction.
The basis of the success of every Belarusian startup must be lying in the combination of a great idea appearing at the right time, investments and highly skilled work of a team that knows how to do business, communicate and develop connections with the global players and investors. Thus, all the links become integral parts of one chain and allow its developers and founders to become famous, projects — popular, and companies — successful.