Category: siberia

Last weekend I traveled about 250 miles south of the Arctic Circle in Siberia to the city of to Yakutsk. Yakutsk is a city of about 250,000 people and is pretty remote; it is about a 7 hour flight from Moscow, mostly over thousands of miles of snow and ice. Typically it gets to -40C and is usually in the news for being the coldest place on Earth (or Mars). Not the place you would expect to find a thriving startup ecosystem.

Fresco came to Siberia to visit the local startup and tech ecosystem. The local Venture Company and government invited Fresco Capital to host a hackathon, startup pitch event, and an ecosystem lecture series. We spent a lot of time in the local ecosystem and learned a lot of amazing things.

Ministry of Investment and Enterprise

Our first stop was a meeting with Anton Safronov, Minister of Investment and Enterprise for the Republic of Sakha (Yakutia) where Yakutsk is the capital city. Anton was an impressive guy, in his mid 30s, international (undergrad at Harvard, masters at MIT), and motivated to bring the digital economy to Siberia. The province is the size of India, has only 1 million people, but has tremendous natural resources like diamonds, gold, natural gas, and oil. They don’t need any help in those industries and if you want a mining or construction job, Yakutia is your place.

The challenge is to diversify and build the tech ecosystem. Anton is the right person for that job as he is the one who got the original ecosystem players to attend the MIT REAP program where they all met me last year. Anton also came to the opening of the hackathon.

The Hackathon

The hackathon was themed “Think Global” and had over 100 people participate. We had great diversity with 25% of the participants being women (and two all-female teams) with some people flying in from all over the region to participate.

The results were amazing. A total of 13 teams presented for the judges (going for the $1000 prize) and most played to the strengths of the Yakutia region while looking for a global appeal. The winner was a blockchain based distributed messenger service as Telegram has been in a dispute with the Russian government. Most projects were ambitious and some standouts were social media tools to manage comments on large sites, social media projects around engagement, travel, VR, and EdTech. As the largest tech employer in town is a very successful gaming company, there were a few impressive game teams as well.

Local Startups

Speaking of games, the largest and most successful tech company in town is MyTona, a mobile gaming company. MyTona was founded in 2012 by twin brothers Alexey and Afanasey Ushnisky. MyTona’s top games The Secret Society and Seekers Notes have more than 50 million downloads and are consistently in the top 20 grossing iOS games worldwide. We visited their office and they have over 300 employees building the games right in the middle of Siberia! MyTona could not find enough game developers in Siberia, so they train them after hiring them. A supporter of the local ecosystem, it also tells you that you can build a high performing startup anywhere.

We also visited the offices InDriver, a peer to peer ride sharing app also based in Yakutsk. Different than Uber insofar as most drivers are everyday drivers looking to pick up someone to carpool and make a little extra money. They compete head on with the big players in Russia and Central Asia and serve over 10 million rides a day. They too have about 300 employees in Yakutsk and recently closed a Series A.

We also had a startup pitch event where we met 10 local startups as well as visited Technopark, the IT park, co-work space, and incubator all rolled into one. All of the successful local startups we saw were ones that played to the strengths of Yakutsk but were focused globally. A lot of bio-tech (many unique plants and animals are nearby), export (tea and legal Mammoth bones), and cool things like vertical farming and fishing, as well as cooking flour made from fish bone. The startups are all early stage, but most have a clear path to try to get to the level of success of MyTona and InDriver.

We rounded out our time by visiting several ecosystem partners including a local bank (doing some innovative stuff), the Arctic Innovation Center, and the Higher School of Innovation Management (a corporate training center and host of several of our events.)

Fun

Of course we couldn’t go to Siberia and not have a little fun in the ice and snow. The organizers took us out to the Lena Pillars Nature Park, or the place the Game of Thrones producers got inspiration for “The Wall.” To get there we had to drive for about 3 hours on a winter ice road on a frozen river. After we arrived we hiked up about an hour to the top and took in the scenery. Of course it was about -25C/-13F and snowing. But it was worth it.

Our trip to Siberia was full of surprises. There is a lot going on in ecosystems around the world and Siberia is no different. The tech ecosystem in Yakutsk is proof that you can build great global startups anywhere.

Look What I Found in Siberia was originally published in Fusion by Fresco Capital on Medium, where people are continuing the conversation by highlighting and responding to this story.

Last fall I did a keynote at MIT at their conference bringing together ecosystem partners from around the world to discuss ecosystem development. I spoke about how Fresco Capital builds global ecosystems and described some of our recent experiments in India, Singapore, and Vatican City. I finished my talk by saying that we like to do a lot of experiments to learn and that we are open to trying anything.

At the break, a group from Siberia approached me and asked if Fresco was really “open to anything”. Vasilii Efimov, representing Venture Company Yakutia, a Siberian VC, asked if Fresco would come and visit Siberia.

The team from Siberia was at MIT to discuss how to stimulate economic development in the remote region of Yakutia by building an ecosystem with multiple partners. The team is a partnership between the local VC fund, the Ministry of Investment Development and Entrepreneurship, a local bank (doing some innovative things around IT and exporting), a regional university, and an IT park.

I was impressed with the region’s commitment to ecosystem development and the large group of diverse stakeholders assembled to make it happen; I committed to learning more and to visit Yakutia in 2018. The team at Fresco wanted to see how this model was working in a such a remote region and if we can learn from their efforts and help replicate it in other environments.

We talked about organizing a local Hackathon, similar to the Hackathon we helped organize in Pune, India. The goal of the Hackathon in Yakutia is to learn about the developer and tech ecosystem in Siberia and see how the Hackathon model brings ecosystem people together in remote regions. The Hackathon will be held later this month at the Higher School of Innovative Management which is a large professional development center.

In addition to the Hackathon, we decided to organize a local startup mentor office hours and pitch event to give the local startups an opportunity to work with and pitch to an international group (besides me coming from Silicon Valley, I’m bringing partners from Hong Kong and Canada.) It will be a great learning opportunity for the local startups who don’t get a lot of international exposure. They will get some dedicated mentor time as well as have a group pitch event to gain feedback on their pitch as well as their business model. We at Fresco will learn more about Yakutia’s model of building ecosystems.

The team in Yakutia also organized an entire “IT Weekend” that consists of the Hackathon, the startup event, a few mini-conference sessions, local ecosystem tours, and visits to government, Techopark (IT park), university, and corporate partners.

The Yakutia team likes to brag about how cold it is there, apparently, the coldest inhabited place on Earth. Not sure what I’m getting myself into. However, I’m looking forward to spending time learning, exchanging ideas, and helping build global ecosystems.

Why I’m Going to Siberia was originally published in Fusion by Fresco Capital on Medium, where people are continuing the conversation by highlighting and responding to this story.