Alexey Basov Takes Part in the 14th Siberian Venture Fair.
On October 30, Deputy General Director — Investment Director of RVC Alexey Basov spoke at the plenary session of the 14th Siberian Venture Fair “Venture Industry — Who and In Which Way Invests in Biotech and Pharma?” The session experts discussed the dynamics of the development of the venture capital market in Russia and new trends in the industry under the coronavirus pandemic's influence.
According to Alexei Basov, companies developing high technologies in medicine have become the primary beneficiaries of the changes that have taken place in the market in 2020.
“This effect is easy to measure through the number of IPOs in the US market. We see companies in the early phase, becoming unicorns. Operating with a staff of dozens of people, they manage to create partnerships with large corporations, as well as receive ratings that could be the envy of technology companies that are at quite mature stages”, said Alexey Basov.
The expert also noted the arrival of new players in the healthcare sector, represented by large corporations.
“We see the ambitions of companies such as Sberbank or Russian Railways, and we understand that medicine is becoming a must-have element of the strategy of any large corporation, not to mention private players such as AFK Sistema, which already has a whole portfolio of projects and a serious track of investment transactions in the field of medical technology in the venture phase”, he added.
During the pandemic, solutions in pharmaceuticals, medical technology and products, and digital platforms with a fundamentally new ability to scale have emerged. These solutions became the object of close attention of investors.
“The new joint venture fund of RVC and the Ministry of Industry and Trade PharmMed Innovations is aimed at investments in this particular segment. The fund invests mainly in the development of the middle or early stage. However, this does not exclude the possibility of investing in high-risk seed projects, and, conversely, in relatively low-risk projects in their late stages”, said Alexey Basov.
Speaking about the impact of the crisis caused by the pandemic on the venture capital market, Alexey Basov noted that both in Russia and in the world, the crisis was expressed in a reduction in the number of transactions but had little effect on the volume of the market.
“In Russia, the number of transactions has decreased by 30-40%, but in terms of money by the end of the year, the market will drop very insignificantly, by 5–7%, which is in line with global trends. These phenomena are associated with the redistribution of the risk portfolio of investors who continue to invest, seeing new opportunities. Still, they are forced to act in the face of uncertainty, which, unfortunately, is likely to spread to early 2021. The crisis hit companies that were in the early stages, but not the market as a whole”, concluded Alexey Basov.
The Siberian Venture Fair has been held annually in the Novosibirsk Region since 2007. The fair brings together up to a thousand participants from the professional community: managers of venture funds and private equity funds, business angels, development institutions, and others. The event organizers are the Ministry of Science and Innovation Policy of the Novosibirsk Region and the Novosibirsk Regional Foundation for the Support of Science and Innovation Activity.