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GenerationS start-ups attract more than 1 billion rubles of investment

01.11.2016
GenerationS start-ups attract more than 1 billion rubles of investment

RVC presented the results of the first monitoring technology start-ups — the participants of GenerationS accelerator — the largest in Russia and Eastern Europe. The analysis includes an assessment of about 200 start-ups, which at various times participated in the accelerator. The volume of investments in start-ups amounted to 1.13 billion rubles. The total evaluation of business — 2.2 billion rubles. The total revenue of companies in 2015 reached 1.2 billion rubles; meanwhile, almost half of the projects increase this amount by half every year.

The main task of monitoring is to trace the dynamics of GenerationS projects and establish a mechanism for obtaining feedback to be able to work more effectively with the alumni community by offering them the most useful and relevant support tools. Among the parameters of assessment — business development dynamics in terms of the volume of revenues, number of employees, the amount of attracted investments and grants, business geography, participation of start-ups in the life of regions, etc.

The GenerationS accelerator is primarily focused on the work with young companies that are at the initial stage of development. The age of 26% of start-ups-graduates does not exceed two years, 30% — from two to four years, another 16% are companies that are operating for 5-6 years. The teams of the most start-ups (54%) consist of less than 10 people. By going through acceleration, novice "proto-companies" become capable of making a qualitative leap and move to the next stage of development. According to the monitoring results, the share of companies at the pre-seed stage after participating in GenerationS decreased from 34% to 8%, at the seed stage — from 32% to 21%. The number of companies at the stage of early growth, by contrast, increased three times, and at the expansion stage — by more than seven times. Start-ups GenerationS work in industries such as pharmaceuticals, agriculture, telecommunications, oil and gas, manufacturing, and instrumentation.

The monitoring results showed that after participating in the accelerator, the companies managed to attract 1.13 billion rubles of investment, despite a long investment cycle of high-tech projects. Fifty-four per cent of the total amount of transactions have been made with the participation of venture capital, 25% — with the participation of business angel capital, 21% — with the involvement of strategic partners from corporations. The market-based valuation of GenerationS start-ups, calculated on the basis of data on transactions and attracted investments, has amounted to 2.2 billion rubles. In 2015, the total revenue of the companies exceeded 1.2 billion rubles. About 44% of accelerator graduates annually increase revenues by an average of two times.

Thanks to reformatting GenerationS into the line of enterprise accelerators in 2015, the GenerationS graduates began actively work with corporations. Currently, 69 start-ups are implementing joint projects with more than 20 Russian and international companies, including NPO Saturn, GC Morton, GC Efko, Rostelecom, MTS, Krastsvetmet, etc.

Monitoring made by RVC made it also possible to estimate the level of integration of start-ups into the university ecosystem: more than a quarter of all the respondent companies (26%) are founded based on university research. Among the most active universities that provide promising high-tech projects are Moscow State University, Moscow State Technical University, Samara University, ITMO University and MIPT. Twenty-two per cent of graduate companies are still actively involved in the university infrastructure: business incubators, technology parks, fab labs, and engineering centres. Twenty-four per cent closely cooperate with universities on personnel programs and take on students and graduates for internship and work, twelve per cent — participate both as mentors and experts in university entrepreneurship development programs.

Geography of GenerationS start-ups covers not only Moscow (90 projects) and St. Petersburg (23 projects), but also large regional centres. Most companies continue to do business, having their main office in the home region. Cities with the largest number of GenerationS graduates include Yekaterinburg (18), Tatarstan (17), Samara (11), Novosibirsk (11), and Perm (11). About 10% of start-ups after the end of acceleration program have transferred their business to other regions. Thirty-seven per cent of GenerationS participants are successfully operating in foreign markets.

Annually, more than 3,000 projects go through a variety of start-up development programs implemented by RVC. The monitoring allows us to keep track of the teams supported by us and their performances in the long term and adapt our programs for the current needs of their members, says Deputy General Director of RVC Gulnara Bikkulova, The statistics that we received are specific as within GenerationS we work mostly with high technology projects at a very early stage, focused on corporate customers. Nevertheless, we hope that these data will be useful for the organizers and other programs for the development of technological entrepreneurship.

The RVC monitoring also revealed the problems faced by high-tech start-ups. According to the survey, one of the main barriers for the development of young technology businesses is the difficulty of access to investment for high-tech projects (22%). More than 15% of start-ups also pinpoint to the difficulties with sales in the corporate sector: oftentimes, high-tech products do not have their sales markets due to the inertia of large corporate customers, distrust to small innovative companies and a long-term decision-making cycle. The top three challenges for entrepreneurs also include a shortage of personnel: 12% of respondents said that they are faced with the problem of finding qualified professionals to solve their problems. Other common problems include: bureaucracy, inadequate legislation, difficulties with the launch of production and the search for suppliers.

The company also answered to a question: in solving what problems can the programs of development institutions and GenerationS accelerator help? Thirty-five per cent of young entrepreneurs believe that the main task of government programs to support start-ups should be the assistance in networking, establishing relationships with customers from among the large corporations and strategic partners. Thirty-four per cent also expect the development of educational institutions and expert support: assistance in "finalizing" the product and obtaining basic business skills. Twenty per cent of entrepreneurs expect to receive assistance from the state in attracting investment. Among other business needs — promotion and PR (10%), testing and validation of business ideas (7%), assistance in entering foreign markets (3%).



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About GenerationS

GenerationS is the largest accelerator of technology projects in Russia and Eastern Europe and the first federal platform for creating and developing corporate acceleration tool work. It has been held by RVC since 2013. Twelve accelerators have been conducted during this time.

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