The Venture Crisis
The crisis has halved venture financing in RussiaAlexey Gusakov, UNOVA.RU
Analysts of the Russian Venture Investment Association have compiled the final results of the development of the venture market for 2009.
The number of transactions involving venture capital has halved compared to 2008. The volume of transactions involving domestic venture funds has tripled and amounted to only half a million dollars.
The crisis has almost halved the number of companies in which Russian venture funds have invested, according to a study by the Russian Venture Investment Association (RAVI). The data were made public during the Rusnanotech 2010 forum by RAVI Executive Director Albina Nikkonen.
In 2008, Russian venture funds financed a total of about 120 companies. In 2009, this figure decreased to 69. According to RAVI statistics, the investment activity of venture funds has returned to the level of 2006, when the number of companies interested in funds was 65. In 2004, this indicator was at the level of 43 companies, in 2005 – at the level of 33.
The structure of transactions involving private capital (PE) and venture capital (VC) was unevenly distributed. If in 2007 PE transactions prevailed in the Russian venture capital market, then in 2008 the number of VC transactions began to prevail and in 2009 there were almost twice as many of them as PE transactions.
Transactions are also unevenly distributed in their volume. There is a stable and significant predominance of PE transactions. The record volume of this market was recorded in 2008 and amounted to about $ 1.5 million. In 2007, the volume of transactions amounted to $ 1 million, and in 2009, the volume of transactions fell to about $ 0.5 million.
In 2009, according to the association, there were 162 active venture funds in Russia. This is seven funds more than in pre-crisis 2008. However, in 2009 the fund liquidated the most: in 2009 – 12 liquidated funds against 19 new ones. In 2008, the ratio was 7 versus 32.
As noted in the analytical materials of the RAVI, the Russian venture capital fund market has grown from 37 funds operating in 2000 to 162 in 2009.
"If we look at the most active industries in which we invested in 2009, it will be the consumer market – $ 240 million, financial services – $ 80 million, telecommunications – $ 60 million," Albina Nikkonen said. Investments in the medical industry have increased several times compared to the previous year. In 2008, their volume was about $ 3 million. In 2009, this figure rose to $ 37.7 million .
The analytical materials note that in 2009, Russian venture funds stopped investing in companies at a late stage of development. 2.6% of all transactions were seed investments. 61.9% of investments were directed to the expansion of companies.
In 2009, 10 IPOs of invested companies were implemented, according to the RAVI report. Of these, nine were sold to a strategic investor and one was bought out by managers. "Unfortunately, IPO is not yet considered by companies as an exit strategy," complains Albina Nikkonen.
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