About six years ago, a number U.S. venture investors were bullish about Russia’s startup scene. Well-known VCs like Accel and Intel Capital led rounds for emerging Russian Internet brands. Cisco also targeted the region, backing a fund focused on Russia and Eastern Europe. In 2012, the peak year for cross-border deals, U.S. VCs backed nearly 50 rounds for Russia-based startups.
But that was then. More recently, U.S. investment in Russian venture deals has slowed to a halt. No Russian startups have disclosed venture rounds with U.S. investors so far this year, according to Crunchbase data. Most of the big name firms active early in the decade haven’t done a new deal in years.
There are plenty of developments in recent years to dampen U.S. investor enthusiasm. Their exodus coincides with the imposition of U.S. and European sanctions tied to Russia’s military interventions in Ukraine. It also coincides with the beginning of a protracted collapse for the Russian ruble, tied to sanctions as well as falling oil prices. During that time, Russia’s economy also slipped into recession.
Yet while it may be explicable, the shift in U.S. investment is nonetheless dramatic, and it contrasts with patterns for Russian VCs investing in U.S. startups. As we reported previously, Russian investment in U.S. startups has fallen from peak levels, but still numbers a few dozen deals a year, roughly half peak levels.
To put some perspective on the state of U.S. venture investment in Russia, we take a look below at the brief history of deal-making, touch on major investments, and look at the current funding environment.
US VCs steer clear of Russian startupsRead More
