Private Equity Russia

The Belarus government is preparing a project at the order of the president which will lead to the creation of a state venture company.  As proposed, the fund will initially be controlled by the State innovation fund.

“We studied several mechanisms for supporting venture financing at a state level”, said Anatoly Grishanovich.  ”It was decided, as an experiment, to transfer responsibility for this to the State Innovation Fund, as it has experience working with these kinds of projects.”

The fund would be similar in function to the Russian Venture Fund and the Belarussian government will be coordinating with its counterparts in Russia and Kazakhstan in setting up and operating the new fund.

The first Belarussian Venture Fair will be held in Minsk in November at which the activities of the new fund will be spelled out in detail and introduced to the public.

[Via Unova]

RosNano has announced it will invest 155 million rubles ($5.34 million) in a project to develop tagged neutron detection systems for explosives and narcotic substances to be used in airport and facility security screening as well as portable systems for inspection of vehicles and cargo containers.

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Credit: Yevgeny Kondakov, Spiegel Online

Chatroulette founder Andrey Ternovskiy has announced that he will be visiting the US to meet with venture capital and private equity investors.

The  17-year old Moscow Internet sensation has already received an offer from Yuri Milner of Digital Sky Technologies (DST), Russia’s leading social media investment company. DST owns stakes in V Kontakte, Mail.ru and Facebook among others.

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UFG Private Equity and the EBRD are reportedly investing $30 million into a new cell tower company founded by seasoned American telecom entrepreneur Garth Self.  The company, Russian Towers, will build spec cell towers and lease them to operators seeking to roll out 4G service in Russia’s North West Federal District.

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Petrochemical group OJSC SIBUR Holdings and Russian private equity and venture capital fund Leader-Innovations have announced a $30 million joint investment into the creation of new company OOO Plastic Geosynthetics in Tulskaya Oblast.  Sibur will own 66.67% of the new entity and Leader Innovations 33.33%.  The groups have invested 600 million rubles and 300 million rubles respectively. ($20 million and $10 million in dollar terms.)

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The Harvest Greenfield Project is holding a 2 day working group and start-up contest under the auspices of Microsoft’s Biz Spark initiative on February 20-21 at Microsoft’s offices in Moscow.

The Harvest Greenfield Project was founded by Microsoft Biz Spark, with sponsorship and participation from Cambridge’s Judge Business School Center for Entrepreneurial Learning, Softline Venture Partners, Internet incubator Inventure, The Federal Agency For Youth Activities’ Zvorykinski Project, angel investor fund Addventure, and others.

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The FT published a piece today on technology venture capital in Russia, or the lack thereof. SQ7WHTXYZE6U

Several reasons were given for the current lack of activity in technology venture capital and private equity in the Russian market, including high risks, the lack of a technology focused exchange and the lack of stock options for managers.

Alexandra Johnson, of DFJ-VTB Aurora, specifically sited the lack of good managers.  Interestingly, Draper Fisher Jurveston‘s Russian JV partner VTB just announced a stock  option plan worth 1% of its shares for its own top managers.  It has yet to win the required state approval for the program, however.

Also name-checked were Web Media Group, which has invested $20 million in online properties, Digital Sky Technologies (of Russian social networking and Facebook fame) and Luxoft, Russia’s largest offshore programming outsourcer.

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