Alexander Galitsky on startups and the global potential of his projects

The name Alexander Galitsky is primarily associated with the Almaz Capital venture capital firm. The entrepreneur is known for his strict approach to the selection of startups and for the principles that he considers essential for investors. When working with startup founders, he pays close attention to networking. His main investment targets are deep tech B2B projects. A key factor in choosing a particular company, for him, is its global potential and the applicant’s desire to enter the world market.

The fund is now focused on Eastern and Central European projects and companies from the CIS countries. Almaz Capital targets projects related to innovative changes in blockchain, artificial intelligence, and cybersecurity. The fund is also interested in Internet of Things and edge computing startups.

Alexander Galitsky. Career summary

Alexander Galitsky is a well-known IT entrepreneur. He graduated from MIET, received a Ph.D. in Computer Science and authored more than 30 patents. 

At the age of 32, he became a chief designer of communication systems for satellites.

He is the founder of the ELVIS+ IT company.

After visiting Silicon Valley, he decided to promote Russian technology products in the West with the help of venture capital.

Almaz Capital – how the fund was created

In 2004, Alexander Galitsky was invited to lead the European Tech Tour in Russia. The  task of Galitsky and Selection Committee was to select startups – as the most attractive in terms of investment – from different regions of the former Soviet Union. They selected 25 projects out of many candidates.

Alexander Galitsky welcomed the idea of establishing a venture capital fund to invest in Russian startups. The idea came from the American tech giant Cisco that was planning on entering a new market. At the very beginning, Galitsky outlined his conditions; he emphasized, in particular, that this would be a cross-border fund and its portfolio companies would strive to enter the Silicon Valley market.

Galitsky’s name was already well known, so the project gained the attention of such market giants as the European Bank for Reconstruction and Development and UFG, which joined the fund with a capital of $20 million each. The anchor investor was Cisco, which announced its direct interest from the start; the company’s share of investment was $32 million. The fund was established in 2008 and it was headquartered in Portola Valley (California, US). 

The list of the fund’s general partners included:

• Charles Ryan, who was the head of UFG and Deutsche Bank in Russia at the time;

• Peter Lukyanov, a Russian-American entrepreneur, who had worked at the Alloy Ventures firm;

• Pavel Bogdanov, who was already familiar to Galitsky from his work at the Russian Technologies fund.

Alexander Galitsky took the position of Managing Partner.

In 2013 Almaz II fund was established. Geoffrey Baer, who worked for the U.S. Venture Partners and whom Galitsky had long known from working on the same projects, took over from Peter Lukyanov (who stepped down by this time). Cisco and the EBRD once again took on the role of institutional investors. The International Finance Corporation also joined the fund as an LP. The volume of assets was valued at $174 million. At this stage, Almaz II shifted its attention towards startups from the CIS and Central and Eastern Europe. The decision was made at the insistence of the institutional investors.

2021 marked the founding of Almaz Capital III, with a capital of almost $200 million. The list of LPs included the EBRD and the European Investment Fund.

During its operation, the fund has invested more than $300 million in different projects. Over 50 companies received the investments. Among the most successful exits were Qik, Sensity Systems, Yandex, Acumatica, and Xometry.

Other projects by Alexander Galitsky

At the moment, Alexander Galitsky’s business interests are focused on his own projects. Due to the specific nature of his activity, he prefers not to advertise the details of the search for fresh startups. Mr. Galitsky’s personal life is also out of the public eye.

According to the latest news about Alexander Galitsky, he withdrew from all the state projects in which he had ever participated. Galitsky’s attention is focused on cross-border companies, so he decided to withdraw from the Venture Market Council, RVC Advisory Board, and Skolkovo Ventures. He is also no longer a board member at Megafon, Skoltech, and the Russian Quantum Center.

In March 2022, Alfa-Bank announced on its website that Alexander Galitsky would be resigning from his position on the bank’s board of directors. He had participated in it driven by the need to look into the specifics of banking operations on a European scale and assess whether he should turn his interest to the fintech industry.

The media also reported on Galitsky’s participation in the Moscow State University Business Incubator. The project was suspended after the first meeting, which was attended by the entrepreneur.

Since March 2022, Alexander Galitsky is no longer a board member at Skolkovo. The entrepreneur explained that the reason for his withdrawal was the fact that international investors are not as interested in Skolkovo as in 2010, while his personal priorities lie in the cross-border markets.

Huynh Nguyen

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