11:13 | 20.10.15 | Articles | exclusive 12922

Guidelines for Armenian startups: U.S. vs Russian market

Only a few startups nowadays try to solve only local problems inside Armenia’s borders, especially because having multimillion audiences seems very real in the 21st centuary. Where to go? To cross the ocean and pursue the American dream or just try oneself, for instance, on the Russian market.

PR and marketing strategy specialist Sophia Arakelyan worked with Wakie startup and helped the latter to growth their business in the American market.

Itel.am discussed the ecosystems and presented overall characteristics of 2 markets with Sophia Arakelyan.

U.S.

There is a well-established culture of startups in the Silicon Valley. Sitting in a café you will see young people with laptops working around you.

One of the perks here is that there is money in this market. The venture fund culture has been working here for a long time. There is also a good ecosystem of business angels. They give the money that startups need for the first steps. Donors can be either a professional business angel or just somebody who doesn’t have any idea about the market but has heard about the startup, got interested and can invest in it.

There are open lists of business angels which allow one to have an idea who is interested in what kind of startups and which of them can take interest in you startup.

Accelerator system is well-developed, too. Some of the most prestigious are Y Combinator, 500 Startups. They help the startups develop and become attractive for large venture capital funds. If you can gain their attention, you will be given more importance in the sphere.

It’s also important that there is a developed mentor system. Mentors are great advisors for startups.

Before introducing your startup in the U.S, you should check out what Armenian companies are already operating on the market. If you find a good approach they will help you be properly presented in the local market.

You shouldn’t feel intimidated about presenting your startup to investors on social networks (Facebook, LinkedIn). Some of them are open and may respond to you.

One important notice. There are several venture funds in the U.S that finance startups that have a female co-founders. They think it can contribute to increasing their participation in the sphere. So, think about it.

The U.S easily accepts smart and talented people from other countries. Nationality isn’t important there. If you are smart and have appropriate capacities, you will be welcomed there.

Russia

Yes, there are talented and caring people that want to develop the ecosystem. There are venture funds that help. However, they haven’t yet reached the American standards.

Due to the recent financial problems in Russia they are waiting and not investing a lot of money in startups.

Internet Initiatives Development Fund
has been operating in Russia since 2013 and it is positioned both as an investment fund and investor of the preliminary phase. The institute provides three-month acceleration programs for startups. Getting a further financial aid the startup can pass to the product development stage.

As of April of 2015, IIDF financed 150 programs including 104 of 2014 programs. The fund plans to invest RUB 6 billion in 400 startups by 2017.

The institute is supported by the government and is interested in investing in socially significant startups and mobile applications.

Despite this resource, Russia should work very hard to create attractive and developed investment ecosystem for startups.

Taking into account the current circumstances, it would be hard for Armenian startups to get established and expect significant investments in Russia.

Narine Daneghyan