Russian service marketplace YouDo.com announced today the completion of a $6.2 million Series C financing round, led by Sistema Venture Capital. Existing investors Flint Capital, United Capital Partners and QIWI shareholder Sergey Solonin also took part in the round. The terms of the deal have not been disclosed.
Launch in 2012, YouDo’s platform matches those in need of assistance for day-to-day tasks – a problem with a computer, a translation or some housekeeping – with free lancers or providers who can service these requests.
YouDo raised $1 million from Flint Capital in 2013, then 2.2 million in 2014 from Flint Capital, United Capital Partners and Sergey Solonin.
In 2015, the amount of the services ordered through the platform totaled to 1.5 billion rubles (approximately $24 million at the average exchange rate). YouDo currently serves more than 80,000 active contractors and more than 800,000 unique users, its founder Alexey Gidirim told East-West Digital News.
YouDo claims to have become the leader in this field in Russia. “Yandex.Master [a home service marketplace launched by the Russian search giant in 2014] was the biggest threat for us, but they closed in 2015. Currently we have mono vertical competitors in cleaning, logistics as well as home and repair. But since we’re a one-stop point for all kinds of services, our LTV is much higher than that of any mono vertical player,” Gidirim said.
However, YouDo also competes with such strong players as Eruditor and Avito. The previous operates several specialized service marketplaces where users may find hairdressers, fitness instructors, plumbers, or doctors. Since its launch in 2007, Eruditor has been generously funded by venture investors, including Intel Capital, Frontier Ventures, and Runa.
Avito, Russia’s leading classifieds platform which was sold last year to Naspers at a 2.7 billion valuation, is not a direct competitor to YouDo, but has ‘Services Offered’ and ‘Services Wanted’ pages. However, Avito offers no detailed breakdowns of the type of service wanted or requested. Users can use the search box only manually to specify their request.
International ambitions
YouDo says that the funds will be used to strengthen its market leadership in Russia and expand its operations internationally, including the US, European and Asian markets.
Asked about how the startup will reach such ambitious goals, Gidirim said: “We are going to try different approaches in different countries and check which of them will show the best results. I think we’ll launch in several major cities of Europe and Asia countries simultaneously within the next 12 months.”
“YouDo is a cut above other local platforms thanks to its unique selling proposition,” the proud entrepreneur added.
YouDo is the second portfolio company of Sistema VC – coming just after VisionLabs, a Russian facial recognition startup in which the fund invested very recently.
Explaining the reasons for his interest in YouDo, Sitema VC’s president Alexey Katkov said: “Over the last several years, digital marketplaces have allowed individuals to more easily monetize their time and skills, changing the fundamental way we think about employment while simultaneously increasing productivity and reducing unemployment.”
“YouDo.com is poised to play a much bigger role in accelerating this change,” Katkov believes.
Sitema VC is one of the corporate venture funds launched by AFK Sistema, a major Russian, LSE-listed conglomerate. Targeting internationally-oriented early-stage startups from Russia and neighboring countries, the fund has raised no less than 10 billion rubles (approximately $156 million at the current exchange rate).
