Life.Sreda, which looked just a few months ago as one of the most successful Russian funds, is now seeking buyers for the greater part of its portfolio companies, Russian business daily Vedomosti reported last week.
The fund also cancelled its investment in Advice Wallet, a Kyiv (Kiev)-based startup which develops mobile payment service Settle. In July last year, Life.Sreda committed itself to inject $1.5 million in the startup, but actually disbursed just 10% of this amount, reported the Ukrainian media.
Advice Wallet’s founder Stas Matvienko is said to be in discussions with other funds.
Combining mobile payments and a loyalty scheme in one app, Settle makes it possible to both order and then pay your bill at a restaurant or café through a smartphone. Users register via a social network and link their bank card to the app. The app displays the menu and allows clients to divide up a bill between friends, carry out P2P transactions and receive offers from establishments.
Establishments can join the program for free, receiving a special tablet with software that tracks the activity of clients and delivers their bill. Settle takes a commission on every bill.
Life.Sreda launched in 2012 as the venture arm of Russian financial group Life. Yanchevskaya indicated that the fund was “closed successfully” in December 2014, after having invested over $40 million in a number of fintech startups from Russia and other countries. However, raising a second, $100 million fund has turned out to be more difficult than expected, Yanchevskaya conceded.
With a focus on foreign markets, especially Asian startups, Life.Sreda II will no more invest in Russia and Ukraine.
Life.Sreda’s current problems are, to a large extent, a reflection of the current difficulties on the Russian venture market. InVenture Partners managing partner Anton Inshutin believes that the market volume could decrease by five to six times by the end of this year. “What is happening at Life.Sreda is one of the first signs of the crisis that is descending on the industry,” he told Vedomosti.