Friday, February 14, 2014

A "precision investment" blown under the radar by "rag traders"

It was meant to be a highlight of the second annual Tech Chill Baltics conference in Riga and a record financing round for a Latvian startup with global traction, but it ended up blown down below the radar of mainstream media (where it may have been, in any case) by the double-digit afterburners of a Lithuanian rag trader., the infographics platform that has been gaining global traction and publicity, raised EUR 1.34 million from Point Nine Capital, Connect Ventures and a post-mortem dollop of cash from the recently deceased HackFwd. The new injection of cash will go into, among other things, developing's real time data display capacity (which, depending on the task, can involve a bit of rocket science) and in setting up an operation in the US.
Meanwhile, Vinted, a Lithuanian-based used clothing and accessories trading platform, raised USD 27 million from Accel Partners and Insight Ventures. Superficially, Vinted looks like an adaption or port of a generic peer-to-peer selling solution. And as the IT website/blog TechCrunch notes, the company is entering a crowded market, especially if it's main target is the US (where it already has employees).
Apparently, Vinted won't be building any warehouses or logistics facilities, so it is hard to imagine what the USD 27 million will be spent for.
The comparatively tiny investment in may, by contrast, be a case of precision investment, applying just enough new cash to some very specific needs, while keeping control of the company firmly in the hands of its founders. That seems to be the strategy favored by founder Uldis Leiterts, who recently wrote in an e-mail that "European startups have a problem of selling too early, that's why we don't see great companies emerging from Europe."
"' s founders are committed to stay on board for a long time and build a great service for our customers and a return for our investors," Leiterts wrote. Leiterts has indicated that turned down a "seven digit" buyout offer from an unnamed American company. Meanwhile, Latvian address book and contact management (for MacOS and IOS) startup Cobook was recently bought by Full Contact, a contact management company in the sweet smoke filled state of Colorado. The core Cobook development team from Latvia under co-founder and CEO Kaspars Dancis is moving to Denver as I write.