The point of a venture (risk) business is to present funds to companies that do not have other sources of financing in exchange for a part of the shareholding that a venture investor sells a few years after joining the business for a price that is many times higher than the initial investment. The sale of shares is called an “exit”.
A venture capital business can bring enormous profits – or end up in failure. The American and European economies owe their growth to the flourishing of the venture capital business at the end of the 20th century.
In our country, a political and entrepreneurial climate is gradually forming, favorable for venture and direct investment. A number of steps taken by the venture capital industry community and state structures of various levels contribute to the development of small and medium-sized businesses (in particular, investment in russian ai), which, in turn, may give impetus to the development of the Russian economy as a whole.
With the support of the government, the private sector and international organizations, structures of the research and development sector of the market type have been created, such as technology parks, innovation and technology centers, law firms and consulting companies.
New tools and mechanisms were also created to support the functioning of budgetary and extra-budgetary funds for fundamental and applied research and development, their competitive financing, and the protection of intellectual property rights.
Venture Capital Institutions
The main venture capital “players” in our country are foreign investors. The formation of the national venture capital industry is not going as fast as we would like it to.
The formation of Russian venture funds with the participation of national capital is in its infancy, although domestic pension funds, insurance companies and banks are ready to participate in this work. The lack of an appropriate legal framework does not allow them to effectively use their funds in this sector of the economy.
However, some steps have been taken recently to remedy the situation. By the order of the Government of the Russian Federation dated March 10, 2000, the first fund, the Venture Innovation Fund (VIF), was established to help create regional/sectoral funds with Russian and/or Western capital.
Placement of the company’s shares on the stock exchange is an integral element of the venture capital process. But so far, the domestic stock market is speculative and is not ready to perform its main function – to attract funds from investors in the company through the placement of their shares.
Of course, international exchanges are not closed for Russian companies in principle, but placement of shares in foreign markets requires a lot of preparation.
One of the few successful Russian projects that can solve the problem of secondary quotation of venture capital companies’ shares is the project of the St. Petersburg Currency Exchange “St. Petersburg Growth Market”.
Despite the current progress in the venture capital business in Russia, in addition to the above mentioned, there are still many problems. The main problems include: the impact of the general situation in the global venture capital business, the problems of Russian companies – applicants for venture capital investments and the problems of venture capital investors in the Russian market.
The situation in the global economy and the recent collapse of the so-called “new economy” of advanced countries forced investors, including venture capitalists, to tighten the requirements for applicants for funds.
At this stage, investors prefer projects with low potential, but moderate risk, from which it is easier to “exit”. Investments in such projects belong to the category of “short” money, the return of which is expected in 2-3 years. However, the profitability of such investments is also low compared to the investments in high-tech.