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Burda Media - Going Digital

0 25 March 2014

German media company BURDA is one of the biggest publishers in Russia, producing titles including fashion magazine Burda, women’s mag Liza and its children’s version Liza Girl, tech journals Chip and Computer Bild and men’s mag Playboy. 

Worldwide the firm has been making strategic investments in digital media projects for more than a decade, and its German portfolio companies alone generate an annual revenue of more than $1.5 billion. It is now aiming to build a portfolio in Russia, and we talked to Christian Graggaber, Burda's Chief Digital Officer in Russia, about the company's plans.

Christian himself has considerable experience of doing business in Russia. Ever since a visit in the late 1990s to top up the Russian he had learnt at school, he has been drawn to the country as a visitor and businessmen, making many trips. As well as liking “the people, the country, the food”, Christian was particularly impressed by the business opportunities Russia had to offer, and this led him to enroll in the Skolkovo MBA program in 2010. 

Studying at Skolkovo

This was a very positive experience, and he took full advantage of the ‘bespoke’ nature of the Skolkovo program, which allows students to shape their degree based on their interests. As an entrepreneur first and foremost, Christian chose to focus on startups and benefited from the local expertise of former Evraz president Alexandr Abramov, as well as tuition from world-leading experts based at Harvard and MIT in the USA. 

Another advantage of the Skolkovo MBA was the chance to network. Christian was able to make a number of helpful connections in the e-commerce sector with whom he continues to cooperate. 

Doing business in Russia - Juvalia&You

After graduating from Skolkovo Christian co-founded Juvalia & You, a social selling jewellery startup. The project raised $6 million and launched operations in Russia, India and the USA, with Christian leading the company's Russian branch. However, after a year Russia operations were shut down, and we actually featured the company as our “Fail of the Month” in April 2013. Naturally, I was curious and I asked Christian what happened. 

He explained that the problem was not so much that the business wasn’t working in Russia, but that it was working much better in India, where demand for jewellery is much higher and where much jewellery is also manufactured. This led the team to choose to focus more exclusively on India, and so Russia had to be sacrificed. Christian however was keen to emphasise that he still believes in the social-selling business model, and would like to invest via Burda in similar projects. 

Burda Digital worldwide

Burda is, Christian explained, first and foremost a strategic investor. In Germany the company has been actively investing in digital companies for over a decade and now has stakes in a wide range of successful startups, including Xing, the leading social network for business professionals in the German speaking area (far ahead of LinkedIn), sector-leading pet-products retailer Zooplus, premium dating agency Elite Partner and holiday booking portal HolidayCheck. 

Burda also founded DLD-conference, which now has its own portfolio of startups and it owns investment company Acton Capital Partners. The media giant also holds shares Netmoms, ETSY and GLAM Media, as well as many other companies in which the investment is undisclosed.

Burda in Russia 

In Russia Burda is looking to build a portfolio around its magazines, which will allow projects to take advantage of Burda's strong position and connections in these sectors. Accordingly it has chosed to target b2c projects related to
- fashion and beauty
- home and living
- family/children
- food/cooking
- cars
Ideally Christian is looking to invest up to $3 million in projects that are already up and running, but he emphasised that tickets could be much lower (starting from $500,000), and that in exceptional cases Burda is open to the possibility of investing in late seed projects, or even financing a full exit to Burda. 

So far Christian has been most impressed by projects with the potential to take advantage of unfilled niches. In addition to seeking out Russian projects capable of doing this, Christian’s department also supports Burda’s international projects in Russia such as Netmoms, the most popular mums’ site in Germany, which was launched in Russia as Moy-rebе (My Child), and Silicon-Valley-based GLAM Media.

Worldwide GLAM features more than 4,000 lifestyle websites and blogs, which are based on the company’s vision to create engaging experiences for consumers by packing brand advertising with professional digital content. With more than 290 million visitors per month in 2012 GLAM was ranked #7 in the top-100 web properties that year. Burda Digital Russia is currently overseeing the launch of GLAM on the Russian market. 

If you want to tell Christian about your project, you can do so by registering it in RusBase's database and marking it "for Burda Media". Christian does speak Russian, although he admits that he prefers not to. So Obraschaite in Russian if you must, but if you speak English that’s great. 

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