Wikimart.ru is Runet's leading platform for online stores. Set up in 2009 by two Russian graduates from Stanford MBA, within a year it attracted over 2200 merchants and raised $5,7M finding from a group of Western business angels and Tiger Global Management. This week Vedomosti reported that Tiger Global invested another $7M into the venture. According to Kamil Kurmakayev, one of the founders, Wimimart was approached by a number of other investors, including Accel Partners and Index Ventures. The reason the company chose Tiger Global was simple: the group did not try enforcing their own vision onto the start-up or dictate how things should be done. Previous investments have been spent on expanding the operations, online marketing and SEO. This investment means Tiger Global has over 50% stake in Wikimart.

Quintura reports that Wikimart attracts 2M monthly visitors.  Their business model is commission-based: Wikimart offers merchants a platform for their operations together with order-fulfillment interface, accounting, legal support and e-commerce marketing tools. In return, the company gets a 3% cut from every deal made on their platform. This model has so far proved to be very lucrative: in 2010 Wikimart's turnover reached $2,5M.

Based in Moscow, Wikimart's merchants only deliver goods within Russia's territory. Perhaps the new investment would go towards expanding Wikimart's geographical reach to the whole of former USSR. Consumers from Ukraine to Kazahstan pose an unconquered sea of potential because those countries currently lack a unified online shopping platform at home. Since all of those countries share common language and already trade in goods, it only makes sense to expand that into the online realm.

Russian e-commerce market is booming (it reached $6B last year) and the competition is growing. Wikimart's biggest competitor is Ozon - the oldest e-commerce giant of the Russian internet. Group discount sites like Groupon and KupiVip also pose considerable competition - both have attracted millions of users and substantial sums in investment. However, uniting thousands of stores on the same platform gives Wikimart plenty of advantage in Runet's fragmented e-commerce market.

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Galaxi March 03, 2011

Cheers,

I love it when young people start companies and employ people. At least it shows there is no need for 10 years experience before they can do something meaningful