The Russian from Perm who built a $3bln in-game payments company

Xsolla is little-known in Russia — let alone abroad. Yet, the payment services company could be worth $3 billion, according to research from Goldman Sachs and Bank of America. Xsolla founder Alexander Agapitov gave an interview to The Bell founder Elizaveta Osetinskaya. It’s a fascinating story.

• Agapitov founded Xsolla 15 years ago in the city of Perm, 680 miles east of Moscow. Its servers allow companies to receive ‘in-game’ payments made by online gamers. In 2020, it recorded revenue of $67 million (75 percent year-on-year growth), and EBITDA was $33 million (up 50 percent). At present the company has offices in the U.S., Russia and South Korea.

• Agapitov grew up in a tiny village near Perm. His mother had a dangerous industrial job: “all her wealth management revolved around the need to wear a gas mask for years in order to retire early,” Agapitov said. His father was an alcoholic. Agapitov began studying at college, but soon dropped out. “I wanted to make money selling jeans,” he said.
• Eventually, he began developing payment systems and became interested in computer games. The result was Xsolla. When Agapitov was 25, he pitched up at the 2009 Game Developers Conference in San Francisco and landed his first big foreign clients.
• Back then, he told foreigners their systems were over-priced. “Guys, your basic package costs $5. In Russia people pay $5 a month for internet access, and you’re trying to sell them a candy wrapper for the same money,” he recalled saying. Since then, Xsolla has expanded all over the globe. Now, only about 5 percent of Xsolla’s earnings come from Russia (their main markets are the U.S. and Germany), and their payment system is available in 200 countries.
• Agapitov decided to emigrate to Silicon Valley from Perm in late 2009 as a result of a deadly fire that ripped through a nightclub after fireworks were set off on-stage and caused the deaths of 156 people. “A colleague of mine died there. We simply didn’t have enough ventilators. Americans don’t die because of nonsense like that,” he said. The tragedy made such a big impact that he moved his family across the Atlantic within a matter of months.
• Agapitov admitted that he spends up to four hours a day playing online games. “PUBG, Dota – hardcore multiplayer games where you can replay, replay, replay. For me, it’s a way of communicating, like going out to play with the lads in the yard. I play every day,” he said.

Why the world should care

Whatever the level of political repression, successful IT projects still manage to emerge in Russia. But it’s sad when — like Agapitov and Xsolla — they have to go elsewhere to achieve their full potential.