After two and a half years of divorce from the Russian Yandex and a fight to lift personal sanctions, the founder and former CEO of “Russia’s Google”, Arkady Volozh, is starting over again.

One of the longest-running corporate sagas in Russia came to an end after Yandex NV – the Dutch company founded by Volozh – completed a deal to sell all its Russian assets to the Russian Yandex, separating the two and finalising Volozh’s exit from Russia.

The deal was fully completed on July 16, and Volozh walked away with $2.5bn, money he will now pump back into the new venture, named Nebius Group, that has four main areas of interest:

·                 Nebius cloud business; 

·                 Toloka AI, a data partner for all stages of generative AI development, from training to evaluation;

·                 TripleTen, a leading edtech player in the US and other markets, re-skilling people for careers in tech;

·                 Avride, one of the most experienced teams developing autonomous driving technology for self-driving cars and delivery robots.

 

Volozh and the Yandex managers and developers who left Russia after him expect to build a new business that will turn into the same unicorn that the Russian search engine became a quarter of a century ago.

In his first interview since the deal closed with The Bell he said the divorce negotiations with Yandex had been difficult and had lasted almost two years. Moreover, Volozh was personally sanctioned by the EU, but those sanctions were eventually lifted after he became one of only two senior Russian businessmen to openly condemn what he called Putin’s barbaric war with Ukraine. When the deal was finally announced, Volozh wrote to his friends that he and the team were finally “free and with money” to start something new, says another interlocutor who saw the entrepreneur’s appeal. “A new baby company is born,” he wrote.

Volozh received about $2.5bn from the sale of Yandex NV to Russian buyers. Former finance minister and the architect of Russia’s reforms Alexey Kudrin confirmed this week he will stay on as the advisor to Yandex, which retains about 95% of the value of the whole group before its break up.

Volozh says he will use part of the payout to buy out any investors that do not want to remain in Nebius Group, which retains its NASDAQ listing, where trading in the stock is due to resume shortly.

Nebius Group will be built on the fragments of several Yandex businesses. The main one, which gave the name to the entire holding, is the startup Nebius AI (ex-Yandex.Cloud).

Now the company makes cloud solutions for AI and sells access to computing power to AI businesses. In addition to Nebius' cloud business, the holding includes three more subsidiaries: the project for training neural networks Toloka AI (formerly Toloka), the edtech platform for training IT specialists in the USA TripleTen (formerly Yandex.Practicum) and the developer of unmanned driving technology Avride (formerly Yandex Self-Driving Group).

Nebius Group is controlled by the Volozh family trust LASTAR Trust: it now owns 15.5% of the economic shares and 59.2% of the voting shares. Another 11% of votes belong to directors, top managers and employees of the company, according to its website. Free float accounts for 78% of the economic shares and 29.8% of the voting shares.

Of all Yandex’s assets, “we chose those that were oriented toward international markets according to their business model,” Volozh explained to The Bell. The original plan suggested that the company would build clouds in different countries, so that each region would have its own local service with local security. But things weren’t going well for that business, and at the end of November 2022, OpenAI launched the ChatGPT chatbot, setting off the boom in generative neural networks.

“I have a feeling that AI is not hype, but serious and for a long time. About the same as it was with the Internet and search in the 90s: a big change that happens once in a generation,” the businessman told The Bell. To accommodate this change, he said, the entire existing infrastructure will have to be rebuilt, “and Nebius will do this.”

The company's target clients are AI startups, which, following the market leaders, make either their own neural networks or applications based on them. They need a lot of computing power, but it's hard to get it from the biggest players in the market, like Microsoft Azure or AWS.

According to Volozh, infrastructure is now the main bottleneck in the industry: everyone lacks data centres and electricity. “We will try to be the most important infrastructure for these startups. We ourselves came out of big tech, but now we’re out in the cold, just like them. So we understand what they are dealing with,” Volozh said. Nebius should become the main cash-generator for the company according to Volozh.

And Volozh is back at the helm, taking charge of managing the company personally. He will become CEO of Nebius, and the current head of the company, Roman Chernin, will take the position of commercial director. The company will be headquartered in Amsterdam, where it also maintains its main R&D centre.

Nebius’ biggest physical asset is a data centre in the Finnish city of Mäntsälä, which Yandex built back in 2014 and has been used to work with the foreign clients.

In 2023, a new supercomputer ISEG (named in honour of Yandex co-founder Ilya Segalovich, who died in 2013) was launched on its basis – the 16th most powerful computer in the world and, according to the company, the most powerful available commercial solution in the EU.

After the divorce deal with Volozh, the data centre was part of the foreign assets transferred to Nebius Group. But now it will have to look for billions of dollars in investments to rent and build new data centres and purchase hardware, say two of The Bell’s interlocutors in the holding.

As part of the divorce, the company's employees were given the choice of staying on in Russia and working for the Russian Yandex, or leaving. Some 400 engineers with experience in AI development, creating cloud services and infrastructure for them, moved from Yandex to the new company, with many of them moving to Amsterdam. In just two and a half years after the start of the war, more than a thousand company employees who left Russia decided to cross “to Volozh’s side.” In 2024, Yandex NV reported a staff of 1,300 employees, against the 21,000 Yandex employed before the start of the war.