The RVC Management Board has approved the company's new investment strategy. RVC intends to expand its existing line of investment tools, introduce new standards for cooperation with funds and management companies, and create a comprehensive service platform for different venture capital market players.
According to the new strategy, RVC will take a proactive position in cooperation with funds and portfolio companies and will bring internal procedures in line with the market practices of funds. In order to increase the efficiency and transparency of the investment decisions, an additional instrument, the RVC Investment Committee, will be used. It will include RVC top managers, as well as independent market participants and representatives of large companies. The Investment Committee will participate in the selection of management companies, issue opinions about the investment attractiveness and risks of the funds.
Within the instruments of the investment strategy, RVC will supplement the product line with new investment tools. The company's strategy used to provide for five types of funds: classical venture capital funds, National Technological Initiative funds, as well as corporate, foreign and special-purpose funds. Now, there will be funds for young management teams consisting of specialists with successful entrepreneurial experience, business angels, direct and venture investments, corporate innovations. Due to liberalisation of the requirements for managers, the new tool will make it possible to expand the range of teams which will be active on the Russian venture capital market. RVC’s share in such funds will not exceed 25% and RUB 250 million.
In addition, RVC launches a separate programme to support investments at the later stages. The funds of the later stages will be focused on investments in rounds B, C and pre-IPOs. They will allow for development of a system of IPOs or follow-on rounds for funds of earlier stages, filling the existing gap in the investment cycle. RVC’s share in such funds will not exceed 20% and RUB 1.5 billion.
In total, between 2018-2020, RVC intends to create 10 new funds. Currently, the company manages 26 funds, 4 of them were created in 2017. The total capital of the funds is RUB 35.7 billion. RVC’s share is RUB 22.7 billion.
RVC’s new strategy also assumes improvement in the quality of asset management. For this purpose, new standards of work with funds and management companies are being introduced and internal corporate procedures are being improved. RVC will choose management teams for new funds through a means of selection and open competitions with the participation of independent experts and the use of a scoring system. Such a mechanism will make it possible to stimulate market competition between the management teams and improve the quality of decisions. At the same time, the mandatory participation of managers in the capital of funds is envisaged; their share must be at least 1% of the amount of the fund. In order to stimulate the flow of private capital into the innovation sector when creating new funds, the presence of private investments of at least 50% will be a mandatory condition. For National Technological Initiative funds and special-purpose funds, this should be no less than 30%.
Regarding other innovations, RVC will offer the service platform for different players on the venture capital market: investors, managers and funds, portfolio companies. For example, RVC investors will be assisted in the search for team managers and structuring of funds. Funds and management companies will be provided with expert support in investment decisions, assistance on international markets, the structuring of pipeline and IPOs.
Within the framework of the adopted strategy, with the participation of the VC Market Council, RVC is prioritising the work on the synchronization of public policy measures with the needs of the VC community. This concerns changes in legislation, removing barriers to attracting new classes of investors to the market, increasing the transparency of the industry and preparing global industry analytics. By the end of 2018, RVC will submit a draft project entitled «The Strategy for the Development of the Venture Capital Market and the Direct Investment Market of the Russian Federation» to the Ministry of Economic Development of the Russian Federation, which constitutes an integrated state planning document that offers an applied set of steps designed to increase the attractiveness of the venture industry for the investors.
RVC JSC is a state fund of funds, an institute of development of the venture industry of the Russian Federation. The main objectives of RVC's activities are: stimulating the creation of Russia’s own venture investment industry and fulfilling the functions of the Project Office of the National Technological Initiative (NTI). The share capital of RVC JSC is more than RUB 30 billion. 100% of RVC’s capital belongs to the Russian Federation represented by the Federal Agency for State Property Management of the Russian Federation (Rosimuschestvo). The total number of funds, formed by RVC, has reached 26, with their total amount of RUB 35.7 billion. The share of RVC is RUB 22.7 billion. The number of innovative companies approved for investment by RVC funds has reached 223. The total volume of financial means approved for investment is RUB 18.2 billion.
Source: RVC JSC http://www.rvc.ru/en/