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Yuri Milner creates new fund, bets on Spotify

The fund, DST Global 2, has already invested in Groupon and is also banking on China's 360Buy

Financial trends and news by Faith Merino
March 30, 2011 | Comments
Short URL: http://vator.tv/n/18b0

Looks like Yuri Milner wondered recently what would be better than DST Global. DST Global 2! The investment firm known for making big, risky bets on everything from established titans like Facebook and Groupon to fledgling startups, like an entire graduating class from Y Combinator. Now it looks like Milner has created a second fund that will focus on later stage, high growth companies, according to Russian reports. As it turns out, the fund's very first investment was in Groupon back in January, when the group-buying giant raised nearly $1 billion from over 30 investors. 

The new fund has contributed $50 million to Spotify's $100 million round in February, for a valuation of $1 billion. Kleiner Perkins invested the other $50 million, and both DST and Kleiner Perkins each took a 5% stake in the online music service. 

Additionally, DST Global 2 is jumping into a massive financing round for 360Buy, an e-commerce site affectionally termed the "Amazon of China." The company announced yesterday that it has successfully secured over $1 billion and will share the exact amount on April 1. CEO Liu Qiangdong said in an interview that the company has no plans to IPO for the next two years, but may consider a public offering in 2013. Launched in 2004, 360Buy reportedly has 14% of the country's e-commerce market and has a valuation of approximately $3.6 billion. 

Yuri Milner's risky bets don't stop at late-stage investments. In early February he made headlines when he teamed up with SV Angel to invest $150,000 in every single startup in Y Combinator's then graduating class of 43. Y Combinator has a reputation for accepting entrepreneurs right out of college who enter the program with little money, seeking to get their startups off the ground. 

For all his success, however, Milner has been criticized for capitalizing off what many see as a growing Web bubble. 

But Milner's high-risk strategy appears to be paying off. He recently shelled out $75 million for a 25,500 square-foot mansion in Los Altos Hills that comes fully equipped with its own carwash. It's good to be the king. 

Image source: techrice.com


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