Ivan Tavrin interview with Bloomberg on Nexters business combination.
Bloomberg Markets: Americas — Interview with Ivan Tavrin
February 4, 2021
VONNIE QUINN: This is Bloomberg Markets, I’m Vonnie Quinn. Gamemaker Nexters Global is going public via blank check company Kismet Acquisition [One] in a deal valued at $1.9 billion. Joining us now from Moscow is Ivan Tavrin, CEO of Kismet Capital Group. And also joining us, Bloomberg’s Ed Hammond. Ed.
ED HAMMOND: Vonnie, thanks so much. It’s great to have you on Ivan. Thank you for taking the time out to come on and talk to us about this. So, look, obviously your first SPAC to formally launch — you’ve got two others in the pipe. Tell us about why this company.
IVAN TAVRIN: Thank you, Ed, thank you for having me today. Look, the reason why we found — not only found, but we’re bringing Nexters to the market — is because it’s a truly global company in a truly global industry. The gaming is definitely the business without borders. So, gaming studios from Russia making games for US or Europe, European guys are making it for Latin America. So, it’s truly a no border business. And Nexters is an amazing company. It’s a top-five independent European mobile gaming business with a blockbuster franchise, Hero Wars.
QUINN: Sure, yeah, the multi-player battle game which takes place in Dominion. I’m sure many people are familiar. Now, Nexters is based in Cyprus, Ivan, so, I’m curious as to your thoughts on how to attract investors into countries that may be just a little bit riskier. You yourself are based in Moscow, for example — I imagine it can’t be that easy getting US investors interested in Russia at this moment.
TAVRIN: Look, first of all, US investors are invested in Russia and the jumbo IPO of Ozon, which is like a more than $10 billion business right now, listed on NASDAQ — just happened a couple of months ago. But if you look at Cyprus, Cyprus is really a gaming hub and a tech hub, where more than 100 companies are based in tech. And US investors, as any other, are not looking at geographies, they’re looking at revenues and they’re looking at business. So, Nexters’ revenues generated — more than one third of it is generated in the US, around 40% is generated in Europe, about 20% in Asia. So, the Russia or the CIS part is just about 10% or so — so, investors don’t really focus on geography or location.
HAMMOND: Ivan, I’m interested in why gaming. Look, you obviously have a wealth of experience in TV, in radio, that’s where you spend the majority of your time, and obviously you’re still in telcos. So, why go into the one bit of TMT you don’t seem to have relevant experience in, rather than doing something in the more traditional, sort of, media telco space?
TAVRIN: Look, I think it depends on the timing and it depends on the situation. Right now, and [pandemic] showed it again, the world is moving into tech-enabled businesses, telco is being more tech-driven, media is going to be tech-driven. Look at gaming, 10 or 15 years ago, this industry didn’t exist almost, and now it’s more than books and listening combined. So, you couldn’t find a better place today to invest and if you look at the peers, there are companies from Israel, which are going public, from Sweden, from Poland, from all over the place. So, this is one of the reasons why we picked gaming.
QUINN: Now, it’s obviously going to be listed on the NASDAQ [inaudible]. Where will you look for your next two opportunities — I believe you have three SPACs at the moment. And, I’m curious, are you also going to continue investing in media and in 5G and things like that in Russia?
TAVRIN: Look, first of all, our second and third just filed, so they are not yet — and I don’t think I’m even able to comment on this. But to answer your question — where are we going to look at new opportunities? It’s definitely the European businesses — Russia [founded] or in other geographies. But in the US the competition with SPACs is very intense — there are like more than 200 SPACs looking for acquisition targets, while there is no repeat sponsor which is focused only on EMEA, on Europe, both eastern, western. And there are more and more businesses which would like to go to NASDAQ, because this is the deepest market in terms of investors, investors all around the globe.
HAMMOND: Ivan, I just want to comment on that point, because that’s really interesting. Look, because you say, in the US, pretty much every company out there has probably been approached by a SPAC asking if they want to do some business. In Europe, not so much. There really hasn’t been the same emergence. So, how receptive are you finding those businesses you are approaching in Europe to this model?
TAVRIN: Look, I think, it depends not only on the SPAC and the sponsor but also on the team. And we have teams on the ground in London, in Moscow, and they’re all perfect English speakers and very international. We are a team of Israelis, Americans, Russians — so, I think the companies are looking at the team, which can help to bring it to the market to help build an equity story, help with knowledge of the public markets. And, obviously, I was the CEO of a public company, a lot of members of our team were involved in public businesses. So, I think we have a good shot at it.
QUINN: Phenomenal track record for sure, and you yourself are on the board of this particular gaming company. I do wonder though, to Ed’s point, how are investors looking at Russia right now, I mean, Putin has more and more of a lock on Russia, including its central bank. Surely, as you approach potential targets, they are asking you about that, geography or no geography.
TAVRIN: Look, to be honest, we haven’t been asked about geography when we were raising a SPAC in August, and 100% of our investors are the same SPAC investors from the US, Canada who invest into the US SPACs or Chinese-sponsored SPACs, US-sponsored SPACs. So, they were focused on the founder, it’s international reputation, the ability to find a deal and the ability to work with international companies. We have that experience, we are partners of the Walt Disney Company in Russia and we have [inaudible] with Disney Channel Russia for almost 10 years, we own control in Disney [Russia] almost 49%, I was the CEO of a publicly listed business which was listed in London and in Moscow. So, I’m definitely sure that investors look at the story, at the team, at the founder and at the ability to bring a great deal.
QUINN: Ivan, thanks so much for joining. That is Ivan Tavrin of Kismet Capital and Bloomberg’s Ed Hammond.