$100 million… leta capital wants to be a friend to russian-speaking founders everywhere

The Rise of Russian-Speaking Entrepreneurial Talent Abroad

Over recent years, with increasing control exerted by Vladimir Putin within Russia, a clear trend has emerged. Russian entrepreneurs seeking substantial global engagement are increasingly relocating from their home country.

The era of Russian startups readily attracting significant investment from Western sources has largely passed. Similarly, Belarusian entrepreneurs, facing severe repression, have also departed in large numbers.

Ukraine’s economic performance continues to be hampered by the ongoing Russian military actions in the eastern regions.

Consequently, the onus has fallen upon resourceful Russian-speaking investors, both within and outside of Russia, to identify and capitalize on the considerable talent pool available.

Leta Capital's New Investment Fund

Leta Capital is actively focused on investing in Russian-speaking entrepreneurs regardless of their location.

The firm is launching its third and most substantial fund, committing over $100 million to U.K., European, and U.S.-based, growth-stage technology companies over the next three years.

Investment will primarily target seed, Series A, and Series B funding rounds.

Leta Capital intends to allocate between $2 million and $5 million per investment, concentrating on software, IT, and internet-based technologies.

Focus on East European and Russian-Speaking Founders

The new fund will specifically seek out entrepreneurs originating from Eastern Europe and Russian-speaking backgrounds.

Particular attention will be given to those operating from prominent international hubs like London and New York.

Addressing Undervaluation by Western Investors

Alexander Chachava, founder of Leta and a seasoned tech entrepreneur, observes that Russian-speaking startups based internationally are frequently overlooked and undervalued by Western venture capitalists and investors.

He posits that this is, unfortunately, a valid assessment, extending beyond conventional biases.

Leta Capital's Investment History

To date, since 2012, Leta Capital has invested over $45 million into 30 technology companies.

These include Synthesis AI, Unigine, InDriver, NovaKid, and 365Scores.

Successful Exits

Notable exits facilitated by Leta Capital include the sale of Bright Box HK to Zurich Insurance Group in 2017.

Additionally, WeWork acquired the sales and marketing platform Unomy with Leta’s support.

Strategic Vision and Global Reach

Chachava stated, “Our core strategy remains consistent: to identify and support promising technology startups and entrepreneurs, assisting them in achieving their global aspirations, even as we expand our geographic focus.”

His research indicates that over 17,000 Russian-speaking and East European tech entrepreneurs and startups are currently active in the U.K., Europe, and the U.S.

“Despite often demonstrating substantial Annual Recurring Revenue (ARR), these entrepreneurs continue to be undervalued and underfunded, representing a significant opportunity for investors.”

Examples of Successful Russian-Speaking Startups

Chachava highlights the success of companies like Telegram, Revolut, TradingView, PandaDoc, and Preply, all founded by Russian speakers who emigrated from countries with strong Russian cultural influence.

Fund Performance

Leta’s inaugural “evergreen” fund, totaling $15 million, was fully deployed by early 2020, delivering a gross Internal Rate of Return (IRR) of 27% annually to investors.

Its second fund, valued at $50 million, had its initial closing in September 2018 and has currently committed approximately 60% of its capital.

Operational Structure

Leta Capital will operate through an entity established in the Cayman Islands.

The firm does not currently plan to establish a physical office, deeming it unnecessary for investment activities.

As Chachava explained, “Recent years have seen a shift towards remote engagement via platforms like Zoom. Prior to that, we dedicated significant time traveling throughout the U.S. and Western Europe, including frequent visits to London, but a dedicated office space is no longer essential.”