In 5 years, Ozon.ru will have to cost more than 100 million euros

At a press conference today, representatives of Ozon.ru and Baring Vostok Capital Partners officially confirmed receiving investments from Western partners, an international syndicate that included Index Ventures, Holtzbrinck Ventures and Cisco Systems. Investments amounted to $ 18 million, they will be spent within about 5 years.

The Venture Fund Index Ventures , which at one time invested in projects such as MySQL, Skype, Netvibes and Last.fm, was the main investor. However, the distribution of shares in the syndicate was not disclosed. It remains unknown whether the partners became owners of a stake in Ozon.ru.

As the main areas for which the received funds will be spent, Ozon.ru General Director Bernard Luke highlighted the improvement of the logistics system, the expansion of the assortment of goods and marketing campaigns. In his speech, he also spoke about the results of the company’s work in 2006 and plans for the new reporting period. In particular, the total turnover of Ozon.ru in 2006 amounted to $ 53 million, while the share of the catalog project, which closes this year due to the termination of relations with previous investors, amounted to $ 18.7 million. Net profit of the leading online store in RuNet amounted to $ 600 thousand

Ozon.ru turnover increased by 77%, for 2007 the company plans to grow by 65%. Mr. Luke noted that this projected figure is the minimum that has been agreed with investors and must be met.

Last year, the company sold more than 3 million units of goods, which is 880 tons, that is, in fact, the train. 40% of the online store’s sales are in books, 19% in cinema (on all types of media), 18% in electronics. More than 100 thousand unique visitors visit ozon.ru daily.

In its work, the company, as before, plans to focus on books: it is in this segment of the market that the company occupies a leading position, it is this product that makes up the largest share in the turnover of the online store. Ozon.ru does not plan to fight for the electronics market: Mr. Buke noted that there are already serious players in this area, which the company is not yet ready to compete with.

Giuseppe Zocco, general partner of Index Ventures, said that usually the organization he represents expects an investment to cost more than 100 million euros in 3-5 years .; in this case, the investment is considered justified and successful. Following this, the investor council will have to decide whether the company will become an open joint stock company or part of an international group of companies. Typically, Index Ventures chooses those companies that are leaders in a particular field or create a new segment of the Internet market. Ozon.ru in this situation was chosen precisely as the leader among the online stores of Runet.

Of particular interest to the journalists attending the press conference was the participation of Cisco Systems.: this company is the first to invest in Runet. The representative of Cisco explained that Ozon.ru will not be the only object of investment. The fact that Cisco participates in the syndicate as a non-core "investor" is logical: the company chose to work with "strong partners" this time.