Ostrovok.ru, an online hotel booking service launched a year ago in Russia, announced yesterday it has raised as much as $13.6 million from leading international investors. Among them are General Catalyst Partners, AccelPartners, Founders Fund and Atomico Ventures as well as prominent business angels including Qunar founder Fritz Demopoulos, Yandex board member Esther Dyson, Zyngo founder Mark Pincus, early Facebook investor Peter Thiel, Skype founder Niklas Zennström and several others.
This round of financing comes less than three months after Ostrovok raised $1 million from General Catalyst Partners, Russian fund Kite Ventures and business angels.
Ostrovok.ru aims to build Russia’s “most comprehensive [international] hotel base.” Earlier this month, the site started providing its users with an enlarged offer.
In May, the site claimed 50,000 unique visitors every week and 2,000 new subscribers to its newsletter every day.
As reported earlier by East-West Digital News, online sales of tourism products have grown very fast in Russia over the last few years. Russia saw an estimated 6 million online purchasers of tourism products in 2010. Competition is becoming more intense, but the growth potential remains huge) — less than 5% of travel services are sold online in Russia vs. 30% to 60% in more advanced countries.
“Russia has many markets that are not dominated by anyone while in other countries similar markets have companies that are already worth billions. There is a lot of buzz but there are very few companies that are doing the right thing successfully,” Arctic Startup quoted Ostrovok co-founder as saying.
The transaction represents a record level of investment on the Russian online travel market. Last April, Oktogo.ru, another online hotel reservation company with its headquarters in St. Petersburg, announced it closed a $5 million round of financing with Western funds Ventech and Mangrove Capital Partners and Russian fund ABRT.
Last May, Travelmenu.ru, a site offering a suite of travel products to Russian and Ukrainian Internet users, raised $1.6 million from Russian funds Almaz Capital Partners and Runa Capital.
