Advertise On EU-Digest

Annual Advertising Rates

4/7/14

Ukraine: Russia, U.S. tied by technology investments - by Benny Evangelista

Growing up in the old Soviet Union, Dmitry Akhanov feared Americans. "Being a kid in the early '80s, it would have been both a challenging and frightening experience to talk to a U.S. person, because of the Cold War and all the history," he said.

Today, Akhanov is Russia's point man in Silicon Valley, a striking example of how investment, not ideology, governs the relationship between the two historic rivals. As president and CEO of Menlo Park's Rusnano USA, Akhanov oversees the U.S. unit of a Russian government-owned nanotechnology fund that has invested about $1.2 billion in the last three years in American companies.

"When you do business with someone, you tend to trust them, otherwise you will not be doing business with them," Akhanov said. In the post-Soviet era, younger generations have been weaned on the Internet and social media. "You know people personally," he said. "You meet them, and you see them from a different viewpoint."

However, Russia's decision to annex Crimea and mass troops on Ukraine's eastern border is testing those relationships.

"We know how to work when we're in different parts of the world," said Ukrainian entrepreneur Yaroslav Azhnyuk, the 25-year-old CEO of a San Francisco startup called Petcube. "Even if something horrible happens, we'll just move to Europe, or wherever, and continue working from there."

Petcube, which is developing a device that lets people watch their pets through a mobile phone app, operates a development office in Kiev.

In some ways, the growing economic ties between America and Russia could make a potential conflict even messier. Silicon Valley depends a good deal on Russian money and Ukrainian engineers to power its startups, while tech giants Cisco Systems and Google have made major investments in the former Soviet Union.

Russia is already pulling money out of Ukraine. Russian investment in Ukrainian startups has nearly stopped because of government propaganda, said Vitaly Golomb, a Bay Area entrepreneur and investor.

One problem is the lack of leadership in Ukraine, a situation that may not be cleared up with elections at the end of May.

Some companies aren't waiting. Some businesses have already developed contingency plans to move staff to a neighboring country.

"I have a few friends who run those companies, and they started doing preventive things like opening an office in Moldova, which is like 70 miles away from Odessa, because they have deadlines and they have budgets to meet," said Denys Zhadanov, marketing director for Readdle in Ukraine, which makes popular business productivity apps like Scanner Pro for the iPhone and iPad.

Read more: Russia, U.S. tied by technology investments - SFGate

No comments: