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Access to capital for growing innovative companies and small scale businesses
Moscow, April 16, 2012Moscow, April 16, 2012
Small Scale Business growth in Russia…Small Scale Business growth in Russia…
6630% 30% Small firms’ share in
the total number ofall businesses
Small firms’ share inthe total number ofall businesses
20% 20% Percentage of GDP Percentage of GDP
60% 60% 70% 70%
Entrepreneursper 1000 people Entrepreneursper 1000 people 30 30
EUEURussiaRussia
The innovative development strategy of Russia for 2020,
approved by the Decree of the Government of the Russian Federation on December 8, 2011 N 2227-р
The innovative development strategy of Russia for 2020,
approved by the Decree of the Government of the Russian Federation on December 8, 2011 N 2227-р
*5-10%** - Russian Government objective by 2020*5-10%** - Russian Government objective by 2020
…is impossible without development ofhigh-tech production
…is impossible without development ofhigh-tech production
0,25 %0,25 %
Worldwide exports of high technology productsWorldwide exports of high technology products
16,3 %16,3 % 13,5 %13,5 % 7,6 %7,6 %ChinaChina USAUSA GermanyGermany Russia*Russia*
It needs urgent investments It needs urgent investments
"Our country is now among the top ten world leaders in financing R&D activities. We have recently increased public spending on this sector and take the eighth place in the world concerning investment in R&D, coming up to such countries like Great Britain and France and outrunning Italy and Canada, "- said Mr. Medvedev.However, he highlighted insufficient growth of private investment in innovation."Business is not so dynamic as we expected. Of course, there are some reasons for it. Russian companies’ costs on innovative and technological development have augmented from 190 billion rubles in 2006 to 350 billion rubles in 2010. I can admit that this growth is not significant. As a matter of fact, it is rather a weak growth, "- declared the Russian president.
"Our country is now among the top ten world leaders in financing R&D activities. We have recently increased public spending on this sector and take the eighth place in the world concerning investment in R&D, coming up to such countries like Great Britain and France and outrunning Italy and Canada, "- said Mr. Medvedev.However, he highlighted insufficient growth of private investment in innovation."Business is not so dynamic as we expected. Of course, there are some reasons for it. Russian companies’ costs on innovative and technological development have augmented from 190 billion rubles in 2006 to 350 billion rubles in 2010. I can admit that this growth is not significant. As a matter of fact, it is rather a weak growth, "- declared the Russian president.
RIA Novosti. OCTOBER 29, 2011,RIA Novosti. OCTOBER 29, 2011,
750 000private investors registered in RTS-MICEX,
31% of turnover ($1.05 trillion in 2011)
750 000private investors registered in RTS-MICEX,
31% of turnover ($1.05 trillion in 2011)
$ 68 000 000 000in individual deposits in Russian banks (Rosstat)
$ 68 000 000 000in individual deposits in Russian banks (Rosstat)
$ 16 800 000 000total amount of capital in the Russian Venture Capital Association (RVCA)
$ 16 800 000 000total amount of capital in the Russian Venture Capital Association (RVCA)
$ 22 000 000 000Pension funds: (5-10% can be invested in alternative assets)
$ 22 000 000 000Pension funds: (5-10% can be invested in alternative assets)
Russia has money for small scale businessRussia has money for small scale business
100 000people with spare capital more than
$1 million. HNWI (World Wealth Report 2011)
100 000people with spare capital more than
$1 million. HNWI (World Wealth Report 2011)
1 000 000 000 000 rubleswill be spent on modernization in 2012 (October 2011, Russian President Dmitry Medvedev)
1 000 000 000 000 rubleswill be spent on modernization in 2012 (October 2011, Russian President Dmitry Medvedev)
but it can not find the way to small business
but it can not find the way to small business
IIM RTS-MICEXonly for public companiesIIM RTS-MICEXonly for public companies
RTS Board, SecondShares secondary market for open joint-stock companies where the issuer is not an initiator
RTS Board, SecondShares secondary market for open joint-stock companies where the issuer is not an initiator
Data Bases
contain information about start-up projects, however are mostly informational
Data Bases
contain information about start-up projects, however are mostly informational
absence of efficient systems which provides informational disclosure of projects and facilitate tracking companies’ life cycle
absence of expertise
lack of investors (mostly consultants and mediators)
absence of real transactions (professional projects)
lack of insurance systems of transactions and settlements
absence of efficient systems which provides informational disclosure of projects and facilitate tracking companies’ life cycle
absence of expertise
lack of investors (mostly consultants and mediators)
absence of real transactions (professional projects)
lack of insurance systems of transactions and settlements
is an online information and trading system for attracting capital for leading companies in the innovation sector of the Russian economy
is a platform integrated in IIM RTS-MICEX, which may become one of the infrastructure elements of Russian development institutions and capital market improvements
• creates investors’ data base for Russian innovation sector and for medium and small scale business
• facilitates access to capital for the whole range of perspective young companies
• provides market with new prepared companies
Market Participants Interconnection
Platform for efficient cooperation of entrepreneurs and investors, joint projects realization, information exchange, networking and also for informal communication Promote collaboration with development institutions
Analyticsand Training
Market analysisProject expertise Trainings on capital attraction for innovative entrepreneur
Information and Transparency
Transparency improvementof young sector of innovationMonitoring systems of companies’ financialsDevelopment of corporate management culture
Start-ups Growing Companies IPO Preparation
Initial Level Base Level Pre-IPO Level
Requirements:
to be an innovation sector company, to have legal entity and to provide brief company presentation
Requirements:
to have a board-assistant, estimated capitalization at least $1 million, to provide an investment presentation
Requirements:
to have a board-assistant, capitalization at least $5 million, company valuation and investment memorandum
Information Mode Negotiations Auction
Clearing and Settlement Block is going to be implemented on the basis of National Settlement Depositary RTS-MICEX
Efficient way of company presentation for investors
Information and analytical support of companies and entrepreneurs
Online activities (seminars, webinars, online conferences) for investorsand partners
Private Investors
State Institutions
Entrepreneurs-innovators
Companies
• Encourages growth of participants of sector of innovation
• Meets necessity of small scale business in capital
• Connection with venture and innovative association
• Partnership with leading Russian exchange – RTS-MICEX
• Cooperation with institutions os development
• Open architecture - the ability to connect with external systems
Shares Post – establised in 2009. This platform allows investors to acquire shares of leading technological companies. The system permits to make and process transactions automatically and assure escrow settlements.Provides more than 100 000 private and institutional investors, and 152 companies.
ASSOB (The Australian Small Scale Offerings Board) – is a system for attraction of private and equity capital of medium and small capitalization, created in 1997Number of investors: more than 7500, funds raised - $122 million, major placing is from $250 thousand to $5 million.
Second Market – is a SEC regulated trading platform for alternative assets which is registered by a broker or a member of FINRA, MSRB и SIPC, founded in 2004 Provides more than 50 000 private and institutional investors, and more than 25000 private companies.
114
104
100
30
20200
8200
46
400
100 (24 companies are on IIM RTS-MICEX)
Initial Stage Growth IPO
> 10 000 ~ 600 ~ 100
Projects, approved byRUSNANO
RVC Fund Projects
Projects of funds of private equity and venture capital
CIS companies
potential issuers of MICEX
Foreign companieswith the "Russian feedback"
companies in 3 yearsProjects of Fund for Promotion of Small Enterprises in Science and Technology
RVC Seed Fund projects
“Skolkovo” members
2011 2012 2017
Working in test mode
18 companies
5 companies became “Skolkovo” residents, 2 of them got grant financing
450 investors and users
New comprehensive on-line version
Techniques and standards are being elaborated by the working group of IIMUp to 50 companies
Attraction of up to 1000 investors and first transactions
500companies
10 000investors
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