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Number of transactions with participation of business angels grew by 41% in 2016.

10.04.2017

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National Business Angels Association (NBAA) with support of RVC and Firrma represented an extensive research of business angel investment market in Russia Russian Angel Monitor 2016.

The research has shown that 92 transactions with participation of business angels got to the public field for the previous year, and in 2015 — 68 transactions. Thus, growth on the business angel investment market from 2015 amounted to about 41% in transactions and 20% in money equivalent.

According to Russian Angel Monitor, one of 2016 trends on the business angel investment market in Russia was growth in the number of private investors by minimum 25–30%. In the authors' opinion, during the period of 2014 and 2015 years when the venture market demonstrated slowdown by approximately 40%, one of few growth drivers became business angel investments. In connection with the liquidity crisis people with the free funds were looking for new investment strategy, in particular, in technological projects.

The important part of the research was the most extensive poll of the market participants — more than 60 active business angels of the country participated in it. It discovered important trends. Thus, 47% business angels are ready to invest in science-driven startups in biomedicine, production technologies and other directions. And IT sector still preserves popularity among the investors. Projects related to data storage and processing (48.72%), financial technology (43.59%) and education (38.46%) are of great interest for business angels.

From the point of view staging, 85% of the polled business angels prefer seed stage projects, and 58% are ready to invest in the earliest pre-seed stage startups.

According to Russian Angel Monitor, one of the trends in 2016 was change of generations. A number of business angels existing on the venture market for a long time either ceased active investments or organized their own funds, namely Igor Rybenkiy — set up AltaIR Capital fund, Pavel Cherkashin — Vestor.In.

Transactions syndication is one of the key trends on the market. 61% of the Russian business angels syndicate their transactions, including with the help of various private investors. Joint investments ensure distribution of risks and volume of invested funds between the business angels which is especially important for the beginning investors. Business angels association — NBAA, Venture Club, SKOLKOVO Investors Club, SmartHub, StartTrack, AltaIR Club and other continue systematic development and ensures experience exchange, growth of expertise and competence of their participants.

With increasing frequency, big business representatives act as business angels. In particular, ex-head of the RF president administration Alexander Voloshin and CEO of the Rusagro group Maxim Basov financed Genotek startup.

Chairman of the board of directors of group of companies R-Pharm and co-chairman of “Business Russia” Alexey Repik invested funds in the Grabr Russian service. Furthermore, activity of the famous IT entrepreneurs grew on the market of business angels investments: CEO of the Yandex group of companies Arkadiy Volozh invested Israeli project NeuroSteer and Turkish Getir, founder of KUPI VIP Oscar Hartman and founder of QIWI Sergey Solomin also support startups.

“It’s not a secret that business angel segment on the venture market is the most closed and hard to research not only in Russia, but in other countries of the world. Russian Angel Monitor is a joint product of RVC, NBAA and Firrma, organizations interested in increased transparency of the market and decrease of entry barriers for potential private investors of early stages, — deputy CEO, and member of the management board Gulnara Bikkulova explained. — By joint effort, we were able to form vision of the Russian specific of investments in the early stage projects and analyse efficiency of different formats of involving private investors in the transactions with the technological startups.”

“Every successful company that received investments from the venture funds or acquired corporation, sometimes had its business angel who believed and invested funds, experience and relationships in it when there was no reasonable indications that are so necessary for investors of later stages, — Vitaliy Polekhin, President of the National Business Angels Association commented. — We want to manage development of the market of business angel investments. Despite the closed nature and nontransparency of this venture market segment, we were able to study and calculate its strategic part, and it means that we will be able to direct development measures and support in the necessary flow.”

Authors of the Russian Angel Monitor found primarily on the publicly confirmed information, databases and respected research when working on the research. The analysis doesn't consider private investments in traditional business directions, investments without perspectives of multiplied growth, stock and indirect investments, funds transactions, grants, subsidies, loans from private persons and crowdfunding platforms. Within the framework of preparation of the research, 40 active participants of the business angel investment market, 15 directors of the biggest angel groups in Russia and the most experienced market experts were interviewed.

Detailed information is provided in the research.




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