Forbes - Ukraine's robust startup market

Until a few weeks ago, it seemed many people in the startup industry hadn’t known that editing decacorn Grammarly (valued at $13 billion) or recently-public dev-ops platform GitLab (currently trending at $6.4 billion market cap) were founded in Ukraine and keep much of their workforce there, although startup data company Crunchbase lists both as headquartered in San Francisco. Alexandra Balkova, a partner at Estonia-based accelerator Startup Wise Guys, says she and her colleagues have long recognized this dynamic. “We actually joke about the fact that Ukrainians from Grammarly are teaching the whole world how to speak English,” she says. 

Wrobel, Balkova and VC Borys Musielak, the founder of Warsaw-based SMOK Ventures, hope that realizations of the Ukrainian market’s size, strength and ability to produce valuable companies can bring in more outside investors—one of the largest voids in the current system. “That would be amazing for the founders, for the ecosystem,” Musielak says. “I think the resilience they showed, it’s hard to not take notice. It would be mad if they didn’t.”

Despite the murkiness surrounding the size of Ukraine’s startup investment, just a few weeks ago the market was already in the midst of a multi-year period of growth, all four investors whom Forbes spoke with say—growth the Russian invasion has brought to a halt. Whatever happens in the war, the Ukrainian startup market isn’t likely to be overlooked any longer. —B.S. 

— Volocopter raised $170 million for its electric helicopters in a Series E financing led by WP Investment with participation from Whysol Investments, Honeywell, btov Partners and Atlantia. The round values the air taxi company at $1.7 billion—a hefty total for a company that won’t start running its services for at least two more years. 

— Apollo Global Management agreed to sell Yahoo’s Edgecast content delivery network to Limelight for $300 million in stock. Apollo acquired 90% of Yahoo from Verizon last year for $5 billion, part of a notable pullback at Verizon from digital media. Limelight specializes in video streaming and other content delivery services.

— NFT exchange Immutable announced one of the largest rounds on record by an Australian company, raising $200 million at a $2.5 billion valuation. The round was led by Temasek with participation from Prosus Ventures, ParaFi Capital and Possible Ventures, among others. According to Crunchbase, this was the fifth largest venture round in Australia yet. 

— It’s been a busy past few days at Macquarie. A group led by the Australian investment giant agreed to buy French solar farm developer Reden Solar in a deal worth €2.5 billion ($2.7 billion). Macquarie also signed on to acquire Roadchef, which operates roadside service stations in the U.K., from Antin Infrastructure Partners. And the Financial Times reported that Macquarie and KKR have discussed a potential purchase of U.K. Power Networks that could value the electricity distributor at some £15 billion ($19.7 billion).

— In one more bit of news from Down Under, software billionaire Mike Cannon-Brookes and Brookfield Asset Management are abandoning a joint bid to buy AGL Energy after being twice rejected by Australia’s top electricity producer. The two would-be buyers entered a sweetened bid last week worth A$5.4 billion ($4 billion), but AGL deemed the proposal “well below” the company’s worth. 

— Pony.ai, a Toyota-backed developer of autonomous driving technology, raised new funding at an $8.5 billion valuation. The company was valued at $5.3 billion in a prior funding round last year. In between those deals, Pony.ai pondered a public offering in the U.S. but changed course amid China’s crackdown on foreign tech IPOs, according to Reuters.

— A SPAC deal is no longer in the works for Tomorrow.io, a weather-prediction startup that had planned to go public at a $1.2 billion valuation. The company and its would-be merger partner said they were abandoning the deal to market conditions. More than 20 SPAC mergers have been terminated since the start of July 2021, per data from SPAC Research, compared to just eight during the 18 months before that. 

— Private equity firm Solace Capital Partners teed up a deal to buy Sun Mountain Sports from Rick Reimers, the company’s founder and longtime owner. This is the first significant outside funding for Sun Mountain, which makes golf bags, apparel and other gear.

But despite that progress, the share of overall deal flow that these financings represent rose by just 1.8 percentage points in the same time period—from 4.2% to 6%. In contrast, teams founded by all men raised 68% of the rounds last year.

Speaking of SPACs, many recently public companies—most of which took the SPAC route— are now valued at less than the sum of private funding they raised. (Crunchbase)

An inside look at how India’s richest man is taking on Amazon in the battle for retail supremacy. (Reuters)

Jeffrey Katzenberg discussed the failure of his short-term video startup Quibi at the Upfront Summit tech conference last week. Katzenberg acknowledged there wasn’t product market fit for the platform, a shift in tone from when he blamed the pandemic alone for its demise. (Dot.LA)

After a year long battle to shape the company’s future, Carl Icahn is getting out of the Occidental Petroleum business. (The Wall Street Journal)

The Russian-born billionaire founder of fintech Revolut, the U.K.’s most valuable startup, condemned the invasion of Ukraine and said his company would match up to $2 million in donations to Red Cross Ukraine. (Forbes)

Wordle has won over millions of players and sparked an army of imitators. For the game’s creator, it’s the latest in a long line of unique internet projects. (The New Yorker)

Silicon Valley-based Fort Ross Ventures is unsure if it can call capital from its limited partner Sberbank now that it has been sanctioned. Firm founder Victor Orlovski said they aren’t the only Sand Hill Road investor with Russian backing. (PitchBook)