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2019-06-06 10:15

VEB Ventures plans to invest more than 36 billion rubles in the venture capital market

VEB Innovations LLC was established by VEB in 2017 to invest in technology companies. The company "is a single window for appeals to the VEB Group on the issues of innovative projects support," says its website. Now it changes its name and strategy. The company will be called VEB Ventures and will have to make money on investments in companies through joint venture funds with corporations and other market players. Oleg Teplov, General Director of VEB Ventures, told Vedomosti about it. The presentation of the new strategy took place in the evening of June 6 at the St. Petersburg Economic Forum (SPIEF-2019). Till 2024.

VEB Ventures is going to invest more than 36.3 billion rubles in the venture capital market. In addition, it intends to attract the money of its partners: first, they must invest 0.9 rubles for each invested rouble of VEB Ventures, and by 2024 their share in the investments should grow to 1.5 rubles. The minimum yield of VEB Ventures should be 8% per annum, says Teplov. Russia has enough institutions that finance companies at the early stages of development, but there is not enough funding for projects that need to survive the period before they reach self-sufficiency, Teplov said. VEB Ventures is going to help the companies that made the product and maybe signed the first contracts with scaling up and entering international markets, as well as find investors.

VEB Ventures will have four lines of business. The fund will continue to invest directly in companies, but most importantly, in three types of funds. The first type of funds will be created together with Russian corporations. One VEB Ventures has already created in April together with Gazprom Neft, Gazprombank and Russian Venture Company (RVC): it will invest 4 billion rubles in oil and gas technologies. Three more corporate funds are being discussed now, Teplov said, but he did not name potential partners with whom he is negotiating. VEB Ventures is also going to invest in regional funds in Russia, the first one will be created with the government of Yakutia - the parties have agreed on potential investments of up to 2 billion rubles. Finally, VEB Ventures plans to create funds with foreign partners. The first such fund was also created a year ago with the Indian corporation Srei Infrastructure Finance.

They should help companies to enter international markets. Until 2024, the number of funds with the participation of VEB Ventures should grow to ten from the current two. In Russia, the deficit of late stage investors, as most of the funds are small in size and invest at best hundreds of millions of rubles, says RVC Director Alexei Basov. As a result, successful innovative companies with good revenue and valuation are forced to seek financing abroad or sold to strategists without realizing their potential. RVC is working on tools for mature companies, but the consolidation of this functionality in the mandate of VEB Ventures will contribute to the development of the Russian innovation market, said Basov.

The development institute, which is VEB, is not expected to make direct seed and venture investments, because they need deep industry expertise. VEB should stimulate the market as a whole and other players who are still afraid of risky investments, says managing partner of Skolkovo Ventures Vladimir Sakovich. And financial participation in funds with partner corporations, as well as support of companies at later stages - these are the very tools. Also, the state development institute should support industries that are not very popular with private investors because of high entry barriers, - for example, in the field of oil and gas, new materials, advanced communication technologies, he said. But it is important that the emergence of new large capital in the market does not lead to overestimation in the course of transactions, which sometimes leads to unhealthy competition between investors, and for companies - to problems with the subsequent attraction of funding, he warns.

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