Flyer One Ventures Principal Alexei Yermolenko comments on the fund’s investing plans for 2023 and main deals in 2022. AIN.Capital shares the key points.

• Flyer One Ventures has offices in Kyiv, London, Warsaw, and mainly invests in such industries as online education, digital health, mobile apps, adtech, and AI/ML. Over the last four years, Flyer One Ventures has invested $35 million in 55 companies, had one exit, and saw one portfolio company become a unicorn.
• In 2022, the fund invested in 14 new startups, but not all the deals were public. Among the disclosed deals there were:
  • The UK-based Fintech Farm, founded in 2020 by Alexander Vityaz, Mykola Bezkrovnyy, and Dmytro Dubilet (co-founder of Ukraine’s Monobank) is a startup that creates digital banks in emerging markets. 
  • KarmaCheck, launched in 2019 in the US, the company develops software that helps employers check the background of potential hires and optimize onboarding.
  • Greenscreens.ai, the US-based company that builds a pricing platform for the logistics industry. The startup helps small and medium freight brokers identify and set the optimal prices for cargo delivery.
  • Sheep Inc., the UK’s sustainable fashion startup that produces eco-friendly wool clothing. The startup has also developed software to help fashion brands track carbon emissions.
  • Founded in 2022 a Cyprus-based startup Peech that builds a text-to-speech app. It converts any text (from files, documents, web pages, and even pictures) into audio. The service is available in 50 languages.
  • Parent Village, a US- and New Zealand-based marketplace that helps parents find reliable babysitters. The startup’s team has made a working product with hundreds of customers in just four months, with a budget of $250,000.

News from portfolio startups:

• 27 of F1V portfolio startups raised a round in 2022.
• Fintech startup Fintech Farm and SaaS SMM platform PromoRepublic raised funding rounds during the first months of the full-scale war in Ukraine.
• AllRight, an online language school for children, entered the 2022 Technology Fast winners list by Deloitte and increased its unit economics by three times in spite of quitting eight countries and staff reduction.
• Awesomic, a platform that matches web designers with online businesses, has grown from 70 to 150 employees. It has also doubled its revenue since 2022.
• Cargofy, an AI-driven logistics app, launched its services in five European countries and now has been growing 30% a month in these markets.
• Mate academy, an online coding school, received a $5 million grant from Google for Startups Ukraine Support Fund in December.
• Awesomic and Mate academy have got on the list of CEE Rising Stars by Atomico, Google for Startups, and Dealroom.co.

None of the Ukrainian startups from the F1V portfolio has closed since the beginning of the full-scale war in Ukraine.

Investing plans for 2023

F1V plans to invest in at least 10 startups from CEE and strengthen its connections with the European tech community. The fund will also double its support for Ukraine and Ukrainian founders in 2023–2024.

Global investors are turning their eyes to European founders, especially from Central and Eastern Europe. In 2022, European VCs raised over €16 billion in fresh capital, and CEE showed the fastest growth rate compared to other parts of Europe.

Many new VC funds have been announced in the region recently, including Contrarian Ventures in Lithuania, Inovo in Poland (€100 million each), and Trind Ventures in Estonia (€55 million).

Flyer One Ventures had invested in CEE startups before it became mainstream. For four years, we have funded 50+ early-stage startups and had one exit. Here’s my explanation of what many call a boom.

Reason 1. CEE grows unprecedentedly fast

It is easier to grow in Europe, as the region has a lower base investment. In 2021, startup valuations in the U.S. and Western Europe became too high, so VC funds started looking at less popular markets.

Since 2017, the CEE region has grown by 7.6 times. The combined enterprise value of the CEE startups has quadrupled and now stands at €190 billion. Croatia, Lithuania, and Ukraine have grown the most.

• Croatia — 16.6x, to €10 billion.
• Lithuania — 15.7x, to €4.7 billion.
• Ukraine — 9.3x, to €23.3 billion.

Reason 2. Unicorns boom

Over the last five years, companies valued at $1 billion or more have appeared in Europe more often than in the US. According to Venture Capital Journal, America has created net new unicorns at a rate of 50% year-over-year, while in Europe, it’s been 100% each year.

CEE is not an exception: Since December 2020, the number of unicorns has doubled there. Ukrainian AirSlate and Unstoppable Domains are among them.

Reason 3. Impressive talents 

Among the countries that produce the best developers in the world, there are four CEE states: Moldova (1st place), Romania (3rd), Ukraine (4th), and Poland (7th).

Take Ukraine: It has more than 130,000 engineers — more than any other European country, including Germany and France. And every year, about 16,000 new developers graduate there, the highest number in CEE.

Considering that the experience and skills of a founder play a tremendous role in the success of a startup, talented and highly educated CEE startup creators are sure to impress investors.

• Peech is developing an application that converts scanned or downloaded text into audio.
• The app is available in 60 languages and has been running since fall 2021.
• The lead investor is the Ukrainian venture capital firm Flyer One Ventures. Yury Mazanik, the co-founder of the mobile game developer Belka Games, also joined the financing.

Peech’s co-founders are Andrey Poznyak, Oleksii Gorbal, and Bahram Ismailov. They all moved from Belarus to Ukraine after the mass protests against the proclamation of President Alexander Lukashenko in August 2020.

The Peech team consists of ten people. The founders and top management work from Poland, Portugal, and Estonia. The marketing team is based in Ukraine. Previously all the co-founders worked as developers in international IT companies. Poznyak, the startup’s CEO, worked for the US outsourcing company Coherent Solutions and online casino game developer Skywind Group. Gorbal developed products for EPAM and the Belarusian company Lightpoint.

Peech’s primary audience is highly specialized professionals, such as medics or financiers, who consume a lot of field information. The app is also popular among students and fans of anime and fantasy. The most users are from Italy, Malaysia, Vietnam, and the United States. The co-founders of Peech plan to use the investment to scale up in America and Western Europe.

Previously one of the founders of Flyer One Ventures, Vital Laptenok, invested in another startup developing an app for real-time recording videos of users and their interaction with any content in a smartphone, Yope (Salo).

“We only had one 45-minute meeting, and as a result of that meeting, we got an offer,” Ismailov says. He is not involved in the operational management of Peech, but he supports his business partners with advice and contacts.

• Founded in 2019 by Ain Arend, Timo Timmi, and Tõnis Kusmin, 99math works as a platform for game-based math practice. It engages students with multiplayer math games, tournaments, rewards, leveling up, and progress tracking. The platform focuses on math problems from second through eighth grade.
• 99math is free of charge for teachers, but it is monetized through parent subscriptions. According to the company, almost one million kids use the platform. Since the platform launched, they have solved more than 600 million math problems, which is approximately three million per day.
• Play Ventures led the $2.1 million round. It is an early-stage venture capital fund that invests globally in games and game services startups. The Ukrainian Flyer One Ventures and Estonian Change Ventures also joined in the round as the existing shareholders.

“There are 40 million students learning math in the U.S. and around one billion worldwide. The market is huge and definitely needs a tool to keep up with the times and engage students. We are glad to support 99math in their quest to improve the gamified platform and make the learning process more efficient and interesting,”

Vital Laptenok, general partner at FlyerOne, comments on the startup.

• Using the fresh funding, 99math plans to add more social features and new game designs, like skill tracking. The company also wants to strengthen its position in the U.S. and Latin markets.

What the investment will be used for

The $2 million raised in the seed round will be used to scale up and expand the product functionality.

“E-commerce market is expected to reach $4 trillion by the end of 2021, with the logistics component accounting for 10% to 30% of costs. For example, Amazon’s transportation costs have risen from 19% to 31% over the past nine years, according to Transportation Intelligence. These data show that the market needs solutions that will help streamline the logistics infrastructure. Cargofy’s goal of making the trucking process as simple and easy as ordering a taxi is very appealing for the market. Investment in Cargofy is natural for our ecosystem and allows us to extrapolate our expertise into other markets. We are pleased with our new partnership with Cargofy and are happy to leverage our network and knowledge,” says Alexander Gusev, Co-Founder & CEO of JKR Investment Group.

In addition to cooperation with the partners, the company plans to develop a network of owner-operators drivers. There are over 350 thousand of them in the US. Since they can’t afford brand development, support, and other important things, the team implements them in Cargofy to make trucking convenient for both carriers and shippers.

“Logistics is becoming an increasingly popular industry for technological solutions — this is largely due to the size of the $5 trillion market or 6% of world GDP. In the United States, about 80% of all cargo is transported by road, while the carrier market is highly fragmented, with numerous self-employed operators. We are pleased to support Cargofy in their desire to develop a convenient unified network for self-employed carriers and transform the trucking industry into using an AI-powered freight broker’’, says Vital Laptenok, General Partner at Flyer One Ventures.

How Cargofy works

Cargofy is an AI-based personal assistant for truck owners that collects orders for drivers and offers numerous delivery options for customers.

Every day Cargofy aggregates multiple shipping options in one window and allows customers to choose the most cost-effective delivery from partner trucking companies and its network of independent truckers.

It also helps drivers to find cargo for transportation, as well as infrastructure facilities: gas stations, parking lots, service stations, with a database of more than 10 thousand objects and with exclusive discounts. Cargofy guarantees drivers a rate per mile and a monthly mileage, thus removing additional risks from carriers associated with choosing the best routes. Thus, Cargofy makes ordering trucks as simple as ordering airline tickets.

Also, Cargofy itself generates all the necessary documents for sending the goods, and you can track the transportation in real time.

Story of the startup

In 2014, the Ukrainian Stakh Vozniak and his partners created the app Tona, an Uber-like service for urban trucking. In 2017, Stakh changed the business model and, together with a new team, launched Cargofy, where transportation was between companies, not people.

After the launch, Stakh Vozniak, Cargofy CEO, Alex Kovalchuk, CTO, and Dimitris Alexiou, CMO, set out to automate processes in the freight market using technology and become a real “Siri for truck drivers.”

Initially, the team focused on a narrow segment of immigrants from Eastern Europe, made a localized application, supported in their native language, and thus formed a loyal carrier base. Now Cargofy is represented in the US and Eastern European markets, with the number of trips exceeding 40 thousand.

“We created Cargofy to simplify life for both truckers and shippers who order transportation. Cargofy helps drivers search for the nearest cargo, generates documents, calculates the ideal route, and saves up to $18,000 per year in payments to brokers! In a matter of seconds, the customer receives all kinds of delivery options from self-employed carriers, transport, and courier companies, and can choose among thousands of options the most advantageous in terms of time and price,” says Stakh Vozniak, Cargofy CEO.

Funding round details

The round was led by the European fund Spidertek with participation from the Ukrainian investment firms Flyer One Ventures and Startup.Network, as well as a group of American business angels. 

The funds raised will be used to scale a new product for virtual fitting, YourFit. Among other things, the company will add rapid integration with leading e-commerce platforms, increase the level of personal data protection, and update the interface.

“We need investments to achieve the very ambitious growth and product development goals we have set for ourselves – not only in the fashion e-commerce niche but far beyond it. We now have the major giants in the uniform market and high fashion brands in our portfolio. When developing, we focus primarily on users feedback and brand needs, and this helps us create solutions that are effective and in-demand in the market,” commented Vadim Rogovskiy, co-founder and CEO of 3DLOOK.

At the end of 2021, 3DLOOK raised a total of $14.7 million, including $7.9 million during the COVID-19 pandemic. Among the startup’s early investors are Boost VC, 500 Startups, Almaz Capital, TMT Investments, and the supermodel Natalia Vodianova.

The exact valuation after the last round has not been disclosed. As Vadim Rogovskiy told Forbes, 3DLOOK managed to get to its goal of $100 million as close as possible. At the same time, the company planned a new $15-20 million round for late 2022 – early 2023.

About 3DLOOK

3DLOOK is working on a body scanning and measuring technology that works using artificial intelligence, neural networks, and 3D. It was founded in 2016 by Vadim Rogovsky, who previously ran Clickky.

This year, 3DLOOK’s revenue is almost $2 million. Among its clients are more than 100 companies, including American retailers Tailored Brands and Dickies, high fashion brand e1972, uniform market giants Unisync, Safariland, and Fechheimer Bros, owned by Warren Buffett.

• Vochi has developed the Vochi Video Effects app, which allows the users to apply various effects to individual objects in a video.
• The parties have not disclosed the financial terms of the deal. However, it is known that the founders and the team will continue working on the project. And the Vochi app will continue to be available as a standalone app.
• Pinterest says that the deal will help them build more innovative creator tools for dynamic videos.
• In May 2020, Flyer One Ventures led the startup’s $1.5 million seed round.
• In July 2021, Viktoriya Tigipko’s fund, TA Ventures, invested in the company. Both funds exited after the Pinterest deal.
• After the last round, the startup reported more than 500,000 monthly active users and $4 million in annual revenue.

• Among the investors are co-founders of Wise (Transferwise), Teleport, Pipedrive, and Bolt. The round was supported by Horizon Capital and existing investors TA Ventures and Flyer One Ventures, which invested in the startup in 2019.
• According to the startup’s representatives, the funds raised will go toward expansion in the American and Polish markets.
• Mate Academy is an online academy for IT professions that provides a four-month programming course in exchange for a percentage of salary after employment. The students of the academy learn Java, Front-end, Full Stack Web, and UI/UX Design. In exchange for free courses, students pay 17% of their salary after employment for two years.
• After the seed round in 2019, Mate Academy’s revenue grew 20-fold. Currently, the online academy has 1,300 employed students and 60 employees.

• Chipper Cash has raised a $150 million Series C round led by the cryptocurrency platform FTX. Its valuation in this round exceeded $2 billion.
• According to Flyer One Venture managing partner Vitaly Laptenok, the fund invested in the startup pretty late, but it still made x3 in six months.
• The startup raised this investment six months after its first $100 funding round led by SVB Capital, the investment platform of SVB Financial Group. Deciens Capital, Ribbit Capital, Bezos Expeditions, One Way Ventures, and Tribe Capital also participated in that round.
• The startup was founded in 2018 to develop an international P2P payment system. It is already operating in several African countries, including Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa, and Kenya.

• Flyer One Ventures participated in the round, as well as angel investors from the US.
• Kirat Anand, Head of Pricing Strategy at Walmart, became Competera’s new strategic advisor.

“Competera is a solution that can improve retail efficiency and make prices better for both customers and merchants. So we are pleased to support a company whose technology is changing the industry globally and has such a big impact on the entire industry,” says Vitaly Laptenok, General Partner at Flyer One Ventures.

The company does not disclose details of the deal. However, representatives of the company say that they expect a valuation of $100 million by the end of 2022.

• The company will use the funds raised to enter the US market and accelerate the company’s development.
• Competera technology generates optimal price and discount recommendations. They are based on brand perception, consumer demand, and the retailer’s individual business rules. The recommendations are derived from demand patterns, product interactions, and more than 20 other factors.
• The company started in 2014, and its founders are Oleksandr Halkin and Oleksandr Sazonov. Initially, the team worked on a tool for monitoring competitive data. Today, according to Competera, it has more than 100 retailers worldwide as clients.

The reasons for rebranding

The new name better reflects the investment strategy of the firm, Flyer One Ventures said. As stated, the new brand will help better convey the values and philosophy that were formed during the three years of existence of the firm — “practitioners invest in practitioners.”

Flyer One Ventures is consonant with the name of the first aircraft in the world made by the Wright brothers, Flyer 1.

“The Wright brothers are practitioners, not theorists. This concept clearly reflects the firm’s positioning. The Wright brothers’ Flyer is about perspective and distance. Both literally (the meters they flew) and figuratively (progress). This idea is reflected by the rectangle in the logo,” the representatives of Flyer One Ventures comment on the rebranding.

About the firm

Since 2018, Flyer One Ventures, under the Genesis Investments brand, has invested $20 million in 24 startups from Ukraine, the United States, Lithuania, Estonia, and Georgia. Together with the firm, a16z, EBRD, Greysoft, 500Startups, Startup Wise Guy, business angels from Bolt, Verv, Pipedrive, and others participated in the rounds.

Among Ukrainian startups that Flyer One Ventures has invested in are Allset, Liki24, Mate academy, AllRight, IntellectoKids, VOCHI, PromoRepublic, and RedTrack.

About 99math

The startup 99math is an interactive platform for kids to play math games and compete with each other. The company will spend its fresh funding to create a mobile app for children to play at home and premium plans for monetization.

Teachers use the platform for free. Monetization will be done through premium subscriptions and in-app purchases for parents.

Children engage with the platform during math lessons. The teachers generate math tasks on a given topic and run the game, and the kids play on their phones. It takes less than one minute to set up, and the whole class gets involved in the game simultaneously. 

“Math is a very difficult subject for many children. They don’t always want to study long and hard and, instead, spend their free time on technology, gadgets, and online games. We combined a game, competition, and academic component and showed how fun and interesting math could be. Moreover, with interactive rewards and gamification, a positive feedback loop is created. When a kid sees that they can solve a math problem, they become more confident in their knowledge. This is important because when teachers check assignments in schools, they mostly highlight children’s mistakes. We believe that self-confidence helps children to learn better – that’s why we focus on changing the process of learning in this direction,” shares Tõnis Kusmin, CEO of 99math.

99math has leaderboards, fan communities, and progress tracking. In January 2021, the platform had 300,000 monthly active users who solved more than 170 million math problems.

“We are pleased to participate in this round and support 99math along with a group of prominent investors. We see great potential in 99math and believe in its importance in transforming educational processes. The technology in the hands of a skilled team has turned into a product with one hundred percent organic growth and excellent dynamics. We will apply our expertise in the field of subscription monetization and edtech startup support to help 99math successfully scale in the US,” comments Vitaly Laptenok, General Partner at Genesis Investments.

To apply to Genesis Investments, startups need to contact the firm immediately after confirmation from Y Combinator. To make a deal, a startup needs to confirm that it has been selected for the acceleration program by sending a correspondence history or a signed SAFE agreement.

What is SAFE

Genesis Investment will invest under a SAFE (Simple Agreement for Future Equity) agreement on the same terms as those offered by YC.

SAFE is a contractual form of investment by Y Combinator, under which the fund invests money in a company and receives shares of that company later.

Why Genesis Investments chooses YC startups

Y Combinator is an American seed money startup accelerator that selects 100 to 200 startups twice a year, invests $125,000 in each, and works intensively with them for three months. In return for acceleration, YC gets a 7% stake in the company.

Since 2005 YC has invested in 3,000+ startups. Among them, only two are Ukrainian, and one has Belarusian roots. Genesis Investments will invest in new startups with founders from these countries no matter where they are now.

“Ukrainian and Belarusian startups have a weak presence in the world’s top accelerator. Applying is a step towards a big challenge. We want to motivate the founders to take this step, support them and help them focus on the product rather than fundraising,” comments Vitaliy Laptenok, Managing Partner of Genesis Investments.

What is Adapty

Adapty offers mobile app developers an aggregated tool to optimize subscribers’ retention and engage with paying users to upsell products with automatic behavior-based promotion tools. Adapty offers mobile SDK to quickly plug in-app purchases and subscriptions. Most features such as paywall A/B testing and analytics are available in a user-friendly dashboard, which can be set up without coding.

Adapty eliminates the challenges associated with new and churned subscribers and runs A/B tests for paywalls in one easy-to-navigate platform.

The solution is based on scalable event processing technology and an internal data lake that aggregates in-app events into meaningful information. The funding will help Adapty advance product offerings and to expand dynamically, benefiting from the rapid growth of the mobile subscription industry.

Adapty was launched by Vitaly Davydov, Kirill Potekhin, and Dmitriy Podoprosvetov. Vitaly and Kirill founded data science solutions agencyPoteha Labs and worked together in the subscription business for 6 years, including 1.5 years at EasyTen — EdTech mobile app with 15 million downloads. Later, Dmitriy joined the team to power its team with his 9-year of experience in Business Development. Currently, Adapty’s team consists of 10 full-time professionals with deep tech background in software development and math, business development, and marketing skills.

“Our startup was born out of our personal experience with mobile apps and product analytics. Over the years of helping projects with millions of users, we have seen that subscription churn constantly gets bigger, and сompanies spend their resources on chaotic user management, using analytical services and self-made CRMs as a substitute for the tool they really need. At EasyTen, together with Kirill Potehin, Adapty’s CTO & Co-founder, we benchmarked subscriptions, evaluated, and predicted LTV for users’ cohorts.  We used traditional tools like Excel and Python, but due to the lack of functionality and restricted data formats, we were constantly exposed to limitations, errors, and bugs. It was a real struggle. At Adapty, we address these pain points, adopt an iterative approach to enhance the product according to the latest inquiries, and use the accumulated data to provide precise product metrics to mobile app developers,” says Vitaly Davydov, Adapty’s CEO & Co-founder.

So far, Adapty has been used by 1100+ users. It tracks around $10M in apps’ revenue, and more than 100 apps already became more profitable because of Adapty’s solution. After the Seed round, Adapty plans to improve the precision of its tracking and forecasting features, simplify its A/B testing framework, and grow its sales team. 

“With the rapid growth in subscription businesses’ popularity, we see large potential in the analytics and subscription management tools market. The subscription model goes further than just the market for mobile products. Many services today are subscription-based: loans, rent, utilities, fitness clubs, etc. We believe the recurrent economy is growing not only online but also offline. For this reason, we see great potential in Adapty and believe that Adatpy’s high-quality product and the team’s expertise in mobile apps business and machine learning can fuel success. We are excited to be part of this round and support Adapty,” Kate Seledets, Investment Team at 500 Startups.

“Last year the incredibly helpful and responsive Genesis Investments team believed in our ability to educate and entertain young children worldwide with our high-quality content delivered through a mobile device. Exactly 12 months later we are excited about our Series A investment and expect to exceed new investors’ expectations. We’re building one of the largest companies globally in preschool education and the round will speed up our development very substantially” — comments Andrey Kondratyuk, IntellectoKids Co-Founder.

About IntellectoKids

The platform offers parents of preschool children gamified educational content and structured lessons available on mobile devices. According to SensorTower, IntellectoKids’ apps are steadily ranked in the Top-10 Grossing Apps in Kids 5 & Under category in the U.S. and Canada and in the Top-5 in Brazil, Mexico, UK, France, Germany, and other major European countries.

With a goal to help prepare young kids for school, IntellectoKids’ apps deliver great educational materials combining learning content with a very engaging gaming experience.

IntellectoKids was founded by Mike Kotlov and Andrey Kondratyuk in 2017 already as a distributed team company. The founders manage a team of 40 employees who work remotely from a variety of countries including Cyprus, Ukraine, Germany, Austria, Russia, Thailand, and New Zealand.

The technical team has over 20 engineers. In one year the company grew 5x in monthly revenue and 3x in paying subscribers.

Andrey and Mike have three children each and built the product based on their own need as parents for high-quality educational content for preschoolers. In the past, Andrey has been involved in other successful educational projects, and Mike founded several startups before creating IntellectoKids.

In the nearest plans:

• The team intends to launch a Classroom feature with learning tracks in five core Kindergarten and Grade 1 courses, including Math, Phonics, Science, Arts, and Logic. For each educational topic, IntellectoKids’ Classroom will offer a personalized learning path starting with a pre-assessment and finishing with detailed progress tracking report & recommendations for parents based on a summative assessment.
  
• In addition to the current B2C model, the founders expect in 2021 to offer primary schools and kindergartens IntellectoKids’ platform as an online supplement to support their offline educational process.

IntellectoKids apps have more than 2 million installs and a loyal user base. The company’s target markets include North America and Central & Northern Europe from where the Company receives more than 85% of all its revenues.

According to Max Pecherskyi, co-founder of PromoRepublic, the funding will go toward the development of an enterprise product and strengthening the Sales and Marketing department in the U.S. The company has 12 job openings, including ones in Ukraine.

Investment

The sum of investments raised amounted to $1.5 million. The round was led by Innovestor, an early-stage venture capital investor with the largest venture portfolio in Finland.

The Finnish government organization Business Finland, Genesis Investments, and a group of business angels: Andres Mihalovits, Paul Melin, and Murat Abdrakhmanov also participated in the round.

What does PromoRepublic do?

PromoRepublic is a software-as-a-service company that provides social media marketing tools for multi-location brands, helping them maintain consistent identity and messages across all their franchises.

The startup is monetized through a subscription model with a monthly fee for the service.

The company is headquartered in Helsinki, and the development office is located in Kyiv. According to Max Pecherskyi, the startup team now consist of 50 people, 40 of whom are in Ukraine, and the rest – in Finland, England, and the U.S.

This round will support the AI tutor development and group lessons to reduce lessons cost.

The startup also plans to use the money to keep entering new markets and strengthen its positions in Poland, Spain, and Latin America.

About AllRight

AllRight is a global platform for English learning for kids 4 y.o. and older, which combines lessons with real teachers and homework with AI-powered tutors. The founders of AllRight are focused on low online education penetration rates and aims to digitalize the industry. The company strives to make learning foreign languages available to every child in the world.

AllRight was founded in 2017, and less than three years since its inception, gained the trust of more than 9,000 loyal students. Currently, teachers deliver about 50,000 lessons per month on an interactive online platform controlled by AI.

The learning process is powered by a synchronized software system that comprises a real-time collaboration platform for teachers and students to deliver live lessons online with lessons quality controlled by AI and an AI-powered tutor with a voice-only interface with speech recognition and synthesis to provide an extra opportunity for kids to practice spoken English with AI.

“Recently, we have launched a mobile application with a Virtual Tutor, who gives additional lessons and communicates with students. At this stage of technology development, we can not replace real teachers with virtual ones, but we are working on the close integration of real and artificial intelligence.  We are experimenting with allocating part of the lesson time to the AI-teacher so that the real teacher can conduct several classes at once to reduce the cost of the lessons,” said Oleg Oksyuk, CEO and founder of AllRight.

Expectations of investors

AllRight is focused on international expansion. After its launch, the startup soon entered the markets of Spain and Poland, then Italy.

“There are approximately 1.5 billion English language learners globally and the number of children among them reached 500 million in 2020. The global English Language Learning Market is projected to reach $55 billion by 2025, growing at 7% annually. In such an environment, founders with a precise business vision and a competitive English-learning platform will inevitably accomplish their ambitious goals. The platform currently demonstrates 3x year-over-year growth and the team supports these dynamics by entering new markets and scaling there. With its solid digital marketing and product expertise, Genesis Investments will help AllRight scale internationally and outperform itself,” commented Vitaliy Laptenok, General Partner of Genesis Investments.

This round is the largest deal of Genesis Investments so far. The investors hope that their experience in digital marketing and product expertise will help the startup to scale faster.

It is the first investment of the firm in an American company.

About HackerNoon

HackerNoon is an American technology publishing website that focuses on reporting the latest news related to technologies, startups, artificial intelligence, software development, and blockchain technology.

The media audience is mainly readers from the USA, India, the United Kingdom, Canada, and Germany. The media is based on user-generated content: any user can register on the website and offer an article for publication.

Business model and potential

HackerNoon started in 2016, and by 2020 reached 4 million visits per month without paid promotion methods. The team developed CMS (a content management system that runs HackerNoon.com) and user voting software solution (which runs Noonies.Tech award-winning platform). The company also has a podcast and platform for publishing job openings from technology companies in the U.S. Hacker Noon earns from advertising on the websites.

Hacker Noon has a focus on the English-speaking technology community. In 2019, the USA had more than 12 million technical employees and 550+ thousand tech companies. In the United Kingdom, the number of technicians is 1.6 million, and in India, there are 4.4 million tech professionals. In Q2 2020, the website published up to 30 articles per day. The team plans to reach 50 publications per day by the end of 2020.

Investments

In May 2020, Hacker Noon raised $1 million from Coil, a San Francisco-based startup designed to help creators monetize content. This investment was followed by another $350,000 from the Greater Colorado Venture Fund. During the Seed round, the company was valued at $11.5 million.

“We are pleased to join the funding round with Coil and believe that this deal is strategic for both Genesis Investments and Hacker Noon. We believe that our expertise in media, digital marketing, and monetization can drive even faster growth for Hacker Noon. If needed, we will be happy to assist Hacker Noon with the opening of an R&D center in Ukraine in the future. Hacker Noon is a technological media of a new generation, which may become one of the most important in the next five years, and we want to be a part of this story,” says Elena Mazhuha, Investment Manager at Genesis Investments.

The company plans to spend money on the implementation of a new monetization strategy for content creators, team scaling, and development of additional revenue streams.

The company will use the funds to build new machine learning functionality and improve the onboarding of new customers.

About RedTrack

RedTrack is an ad tracker for media buyers, advertising agencies, and other businesses that advertise and buy online. Its tool allows you to make a real-time analysis of an advertising cost and each traffic channel efficiency, and collect all the data in one interface.

The funds raised will help RedTrack expand product features with machine learning and speed up the automation of the advertising purchase process.

“I have been in digital marketing since 2000, and every trend of the past years has left an imprint on my experience. Tools and techniques change but one thing remains common though all those changes – conversion attribution analytics. We created RedTrack.io to be a digital channel-agnostic tool helping media-buyers consolidate their activities and data. As we grow, we now aim at applying machine learning to augment human intelligence in the insights discovery process”, says Vlad Zhovtenko, CEO of RedTrack.

Promising niche

According to Vitaliy Laptenok, General Partner at Genesis Investments, the digital advertising market is booming. According to eMarketer, it expects total media ad spending worldwide will reach $700 billion by the end of 2020. And although companies plan to cut advertising spending in 2020, Laptenok forecasts a 7% growth compared to 2019.

“Marketing budgets will get smaller, but marketers will more closely monitor the effectiveness of every advertising dollar. In the face of such a strong focus on efficiency, the need for an accurate and affordable ad control tool becomes urgent and immediate. This is why we were so excited to back RedTrack,“ commented Vitaliy Laptenok.

This is the first investment in Elision. The money will be used for further product development and marketing of the company.

About Elision

Elision is a podcasting platform for people who are interested in audio content. The startup was founded by Ukrainian Viktor Pavluchynskyi in November 2019. Now the team consists of 15 people.

The product allows podcasters to upload their content and earn money from it, and listeners can get unlimited access to all podcasts available on the Internet. The platform’s archive now contains over 30 million podcast episodes.

On Elision, you can not only listen to but also visualize the content. For this purpose, the developers created RichAudio, a format of enriched audio, where podcasters can provide listeners with any additional visual materials: text, photos, illustrations, weblinks. Currently, the platform already has 500 exclusive episodes with RichAudio.

The target audience of the platform is people who do not yet listen to or record podcasts, for example, YouTube or Instagram bloggers and their subscribers. Elision’s goal is to increase the number of independent podcasters, give them a chance to compete with big labels, and earn on their content.

Potential and business model

According to Viktor Pavluchynskyi, the founder and CEO of Elision, the industry has been growing by 50% per year in the last few years and is expected to grow tenfold by 2026.

Beta version of the application on Google Play and App Store has already been downloaded by over 1.5 thousand users. According to the expectations of the startup founders, the product will have 5,000 downloads by the end of April.

The Elision team is currently working on exclusive content. The full launch of the product on the U.S. market is planned for May 1. Podcasts will be available free of charge with advertising from startup partners, or for $7 a month with an ad-free subscription. A discounted price of 100 UAH will be available for Ukrainians.

The founders of Elision plan to reach profitability in six months and develop content available on the platform.

“For us, Genesis is, first of all, a strategic partner, which has great expertise in creating products. Thanks to their advice and support, we have been able to avoid more than one mistake. For example, we were advised not to make our own payment system in the application, but to use a third-party service. This saved us about a month of development,” says Pavluchynskyi.

“Viktor and his partners are a very passionate and enthusiastic team with experience in creating successful projects in Ukraine. Secondly, we are considering the market. Podcasting is one of the fastest-growing segments in media. Therefore, we are confident that the project will become one of the world leaders on this market”, – says Vitaliy Laptenok, CEO of Genesis Investments.