The hotly-tipped Russian shopping club KupiVIP has cemented its position as one of the country’s rising stars, raising another $38 million in funding to help grow its business.
In an announcement on Thursday, the company said it had raised the money from investors including Intel Capital (s INTC), Acton Capital and the European Bank of Reconstruction and Development — taking its total raised to more than $100 million.
Like France’s Vente-Privee or America’s Gilt Groupe, KupiVIP holds online flash sales each day that offer products at massively discounted rates to members. It’s proved a huge success with Russian consumers since launching in 2008, tapping into the rapidly growing local internet market. Its services — which also include white label sites for brands like Quicksilver — are on course to bring in $300 million this year, and the company predicts sales of more than $1 billion in the next few years.
The driving force behind the company is 29-year-old German entrepreneur Oskar Hartmann, who has made a name for himself as a bullish and aggressive player in an internet market where speed and are being rewarded.
In a statement, Hartmann said the company now had more than 8 million registered users.
“We were the first company in Russia to launch an online shopping club, and were thrilled with our early success,” he said. “We have only just started to exploit the enormous opportunity the Russian consumer market offers to international brands.”
The business has proven popular with investors, who see the chance for a significant exit coming over the horizon sooner rather than later. Last year the company brought in $55 million of investment from Accel, Mangrove, Balderton and others — a record raise for a Russian internet company at the time. And while that has since been eclipsed, the company remains one of Moscow’s biggest e-commerce players.
There’s one thing that the money is unlikely to be used for, however: international expansion. Unlike his German compatriots at Rocket Internet, Hartmann sees better opportunities in broadening KupiVIP’s business inside Russia before heading off into new territories.