Government fund of funds
Development institute of the Russian Federation

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Phystech Ventures and North Energy Ventures launch a joint Fund

24.04.2019

The new Terra Fund II of $ 40 million comprises 24 investors, including 7 new investors and 17 investors who previously worked for Phystech Ventures and North Energy Ventures. Among the investors in the Terra Fund II are large banks, corporations, RVC, owners of oilfield services companies, international tech entrepreneurs.

The Terra Fund II’s portfolio currently includes 11 Russian tech companies operating in the Middle East, South-East Asia, and North America, including Axel (high-speed telemetry and LWD data processing), UVL Robotics (robotic solutions in logistics), Geosteering Technologies (software solutions for optimization of drilling), ADL Completions (technologies of multilateral completion of wells) and others.

The investment strategy of the new Fund assumes a shift in focus on companies of later stages in the area of traditional energy technologies, smart grids, industrial Internet of things, robotics, artificial intelligence, machine learning. The Fund’s executive team will also work towards increasing the capitalization of the existing portfolio, while assisting companies to form sales channels in global markets, raise foreign capital, protect intellectual property, etc.

In addition to partners Phystech Ventures and North Energy Ventures, Vasily Larionov, former top manager at Schlumberger and Baker Hughes, joined the executive team of the Fund. Saad Bargash, ex-partner of Lime Rock Partners, and Investment Director of RVC Alexey Basov joined the supervisory board of the Fund.

Pyotr Lukyanov,
partner of Phystech Ventures
Terra Fund II is a story when 1+1 = 3, both in terms of the Fund’s capital and the team’s abilities, size of the deals, investment stages, scale of the activities in total. Currently, we are a global player operating in Russia, North America and the Middle East, our portfolio companies generate more than 50% of revenues outside Russia, and major industry players and specialized private investors in target markets invest in them.
Danila Shaposhnikov,
Partner of North Energy Ventures
We are satisfied with the many years of cooperation with Phystech Ventures. Competences of our teams blend seamlessly into each other, which allows, on the one hand, to think and act widely, and on the other hand to add maximum value to portfolio companies. Against the 8-fold increase in the revenue of our portfolio in 2016-2019, we will continue to implement the strategy of bringing Russian technology in the area of oil and gas and traditional energy to the markets of the Middle East, Africa, South-East Asia, showing a steady demand for cost-effective solutions and alternatives to the products of global major players.
Alexey Basov,
Deputy General Director and Investment Director of RVC
When creating the Terra Fund II, the executive team managed not only to preserve the interest of current investors, but also to attract additional market LPs and expand the Fund’s mandate. As a result, the market received a new professional player with successful years of experience in transactions, and innovative companies in the area of industrial technology — a new source of financial resources for growth. I’m sure that the combined expertise will allow the Fund to sign first-rate deals as well as conduct successful exits from current projects.

Phystech Ventures is a venture capital firm founded by Pyotr Lukyanov and Olga Maslikhova in 2013. The company invests in Russia, the USA and South-East Asia in teams developing hardly replicated technologies in IT and energy efficiency. Despite the launch of a joint Fund, Phystech Ventures will continue to invest independently in foreign markets and will expand its presence in Silicon Valley up to three full-time employees. North Energy Ventures is a venture capital firm with a focus on technology companies in the oil and gas sector, energy efficiency and new materials. It was founded in 2012, among partners are Dan Colbert, Ivan Protopopov, Danila Shaposhnikov and others. Fund offices are located in Moscow and Oregon.

Since the foundation the Phystech Ventures and North Energy Ventures have invested collectively in 22 companies, 9 companies were included in the joint Fund portfolio. 2 transactions were completed immediately after the launch of the Fund. Previous funds managed by Phystech Ventures and North Energy Ventures (the total value is more than 30 million US dollars) will continue their independent operations.




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