Russian bank Sberbank and 500 Startups partner to run innovation accelerator in Moscow

500 Startups is on a mission to find and invest in the world’s most promising entrepreneurs.

The firm also takes its renowned accelerator program abroad by partnering with international corporations and governments developing startup ecosystems in their countries.

Earlier this year, Sbrebank, the largest bank in Russia and Eastern Europe, engaged 500 Startups to help launch and provide training for Sberbank’s accelerator.

“Sberbank is 177 years old, and it is not easy for us to reinvent ourselves so that we can keep competing with companies that are nine or 30 years old and are much more valuable than all the traditional companies combined. We are glad that we can learn from such young companies as 500 Startups,” CEO and Chairman of Sberbank Herman Gref said in a statement.

The educational aspect of the 10-week Moscow-based program was headed up by 500 Startup Managing Partner Bedy Yang.

The accelerator’s first class included 25 startups. The companies each received about $150,000 in seed funding from Sberbank. From this group, seven companies were selected to participate in an exchange program based in 500 Startup’s Silicon Valley office in Mountain View, California.

“Russia is a very important market. We were there to help kickstart Sbarbank’s venture capital development,” Yang told VCJ.

Before investing in new markets, 500 Startups likes to team up with companies on the ground, such as Sberbank, Yang said.

“We were very pleasantly surprised with the quality of founders in the program,” said Yang, who added that 500 Startups ended up investing in one of the participants, Heartex, an AI startup.

Sberbank is an important player in many aspects of business ecosystem in Russia, said Victor Orlovski, managing partner of Fort Ross Ventures, a Menlo Park, California-based firm with strong connections to Russia. “It is not just a bank, it is a digital company with a strong relationship to most consumers in the country,” he said.

Victor Orlovski, managing partner, Fort Ross Ventures. Photo courtesy of the firm.

Orlovski has a close relationship with Sberbank. He was the company’s CTO and chief digital officer before starting Fort Ross Ventures, a firm in which Sberabank is a major LP.

“Innovation is happening in Russia,” Orlovski said. “I can compare Moscow’s startup and VC community to Barcelona or Berlin,” he added.

Orlovski, who is not directly involved with Sberbank’s accelerator program, explained that there are five or six accelerators in Russia, but Sberbank worked with 500 Startups to provide startups with the world-class training “right from the start.”

Yang said that political tension between the United States and Russia was not an issue. “We were working with the founders and were completely removed from the political context,” she said.

500 Startups ran similar programs in Kobe City, Japan; Montevideo, Uruguay; and Riyadh, Saudi Arabia.