While some Ukrainians sell NFTs or organize charity concerts to support their country through the war with Russia, three well-known businessmen opted for a different strategy.
Marketing expert Andryi Fedoriv, 43, together with Volodymyr Popereshnyuk (47) and Vyacheslav Klimov (47), co-founders of Ukraine’s largest private delivery service Nova Poshta, launched a VC company called Vesna Capital – “vesna” in Ukrainian means “spring” – to invest in startups that could become the next big thing in Ukraine.
“When I see a cool startup, I want to be a part of it, to share its story and success,” says Fedoriv. “We want the next generation of entrepreneurs to be more ambitious than we were when we started the business almost 20 years ago.”
But it’s not just goodwill. Vesna is somewhere between a corporate fund, a company builder and a family office — three businessmen, who are the sole investors and equal partners in the fund, want to help co-found, invest in and potentially acquire some of the next generation of Ukrainian startups.
Long-term investors
The fund, which did not disclose its size, will invest $500,000-$1 million in seed and Series A rounds — “but there’s really no cap,” Fedoriv says.
“We want to create businesses where we want to stay as shareholders for a long time,” he says. Vesna’s three partners want to continue investing for the next 15-20 years and say they are in no rush to cash out.
“We are not classic VCs who want to invest in a startup and then exit it when there is a profit,” says Fedoriv. “We are not financiers, we are entrepreneurs.”
Vesna has already found five startups that fit all the possibilities and invested almost 5 million dollars. They are all Ukrainians, but they also have customers in Europe and the USA:
- GoodPlastic company, manufacturer of eco-plastics;
- Cooperative, coworking space;
- Doc.ua, digital health service;
- Salo, a video editing application;
- REMO, developer of high-tech workspaces integrated into hotels around the world.
All of these businesses are focused on product development and profitability, not fundraising and rapid scaling, Fedoriv says. “We want to avoid startups that promise magic in their pitch decks but don’t deliver.”
How it all began
In Ukraine, Fedoriv is known as the “father of brands”. His eponymous agency, Fedoriv, has created marketing strategies for some of the country’s best-known companies, including e-commerce platform Rozetka, state e-government service Diia, Kyiv Zoo and Nova Posta, whose founders are now partners at the VC firm .
His agency began working with New Post in 2014, when Russia first invaded eastern Ukraine and annexed Crimea. “We went through many crises together,” says Fedoriv.
The first invasion, a pandemic, and now a full-scale war, took their toll on the trio’s businesses, but did not discourage them from investing.
“The launch of this fund is great news for the Ukrainian economy,” says Alexander Soroka, a California-based Ukrainian VC. “Currently there is little money to invest in the local market.”
The timing for Vesna’s partners is also good, he says, because “prices are falling and the fund can invest in startups at much lower valuations.”
Investment model
Vesna Capital has three investment models: venture investment in pre-seed and seed rounds; private equity in Series A; and company builder.
The company builder helps entrepreneurs with an idea turn it into a company. An example of this is the coworking space Kooperativ, which Fedoriv co-founded with entrepreneurs Edward Meyor and Vasil Grogol. Fedoriv controls almost 90% of its shares.
Vesna’s partners like to get to know the startups in which they invest.
One portfolio company, GoodPlastic Company, asked Fedoriv to help develop its brand. But after analyzing the company’s performance, he says, he realized that the startup really needed to have its own factory to produce panels from recycled plastic. Vesna raised the money, and GoodPlastics opened a 5,600-square-meter production site near Kyiv. “Now startup revenue grows roughly three times a year; it became profitable,” says Fedoriv.
Helping startups with business advice while running his own business is a social mission for Fedoriv. When he, Klimov and Popereshnyuk started their business, they did not attract outside investment and did not pay enough attention to expansion outside of Ukraine. “We don’t want the founders to repeat our mistakes,” says Fedoriv.
Vesna also calls on the expertise of other Ukrainian entrepreneurs to support their startups. Dmytro Borisov, the owner of the popular Ukrainian restaurant chain Gastrofamily, which operates almost 100 restaurants in Ukraine and abroad, has already volunteered to join Vesna’s board of directors.
“Besides giving money, I could also help startups with my expertise in food retailing, food technology, marketing and education,” Borisov tells Sifted. Last year, he invested in REMO, one of Vesna Capital’s portfolio companies.
Managing an investment fund while running your own business can seem complicated. Fedoriv’s agency employs about 100 people in Ukraine, Germany and the USA, while Nova pošta has over 27,000 employees. But Fedoriv, who aims to devote 50% of his time to the venture, says that’s not a problem.
“I wouldn’t say that the fund steals my time. No, it’s just another part of my job,” he says. “I see a lot of possibilities to create. And I cannot live without creation.”
Daryna Antoniuk is a technical reporter from Kyiv. She tweets with @daryna_antoniuk
