Urals | Finance, business | Technology & innovation

Venture fund launch fails in Tyumen; Russian VCs criticized for heavy-handed approach

2 Nov '12
Russian VC investors are overly stringent in their business tactics, making their approach too hard for innovators to stomach and causing systemic problems in Russiaís overall VC market - an opinion expressed by Alexei Sannikov, the chairman of the Committee for Innovation of the Tyumen region in Russiaís West Siberia, reported earlier this week by East-West Digital News, the international resource on Russian digital industries.

Commenting last week on the reasons behind the closing of the Tyumen regional venture fund earlier this year, Sannikov said the Tyumen region had failed to find a suitable company to manage the fund.

ďThe region had committed about 140 million rubles, about $4.7 million, [to the project]. None of the large VC firms agreed to work with the amount, however; they had expected it to be in the billions. We couldnít shell out that much. The venture fund ended up returning the money to federal and regional coffers,Ē he explained.

Elaborating further on the woes of VC investing, the Committee chairman said that venture capitalists tend to come into a project at a later stage when a prototype is developed and ready for serial production. Their money and managerial experience could still provide much help, but VCs trickle in slowly. Sannikov also complained that the Russian and Ural business angel associations the Tyumen region collaborates with also face difficulties bringing investors on board.

On the other hand, sometimes it is an innovatorís wariness that stalls projects, Sannikov emphasized. With venture capitalists routinely claiming controlling stakes and imposing their own management, developers may feel an investorís heavy-handed approach poses a threat to their project and try to shun contacts with the venture capitalists, seeking government support instead or scrambling on their own.

On the upside though, an increasing number of high net worth individuals in the Tyumen region with vested interests in areas other than ventures have been spotted investing in early-stage innovation projects they find appealing, the regional official noted, adding that unlike professional VCs, these investors tend to treat project developers in a more considerate manner.
Publish in Twitter
Write to Facebook
Google Buzz
Write to LiveJournal
Show in MM
Share MK
COMMENT ON THIS STORY
Find Related Content

Locations: Tyumenskaya oblast

Tags: innovators (8) / heavy handed approach (0) / VC investors (0) / Alexei Sannikov (0) /

Latest News: Urals
20 May '22 | Technology & innovation
28 Apr '22 | Technology & innovation
11 Apr '22 | Technology & innovation | Tourism, recreation
23 Mar '22 | Transport, logistics | Technology & innovation
 

Feature stories

25 May '22
From enhancing the properties of existing materials...
29 Apr '22
Scientists in St. Petersburg have come up with a new...
2 Mar '22
Scientists in Dubna have developed what they refer to...
Search (News archive - 22987)
Technology Scouting Solutions For Industry
NATT
Advertising
Marchmont News

Latest News

24 Jun '22
A new device, developed by a Russian start-up and...
22 Jun '22
Russian researchers have come up with a new Si...
21 Jun '22
Engineers at Moscow-based MPEI University have...

Most read stories from last week

24 Jun '22
A new device, developed by a Russian start-up and...