Two deep-pocket, state-owned innovation flagships, the Russian Venture Company (RVC) and Rusnano, and the MICEX-RTS stock exchange have shaken hands on an uncommonly broad-based, private/public partnership designed to aid Russia’s fledgling technology innovators. In a concerted not-for-profit effort called Innovation and Investment Market (IIM), also known as IPO Board, the players are stepping forward to support companies from the start-up stage all the way through to an IPO.
The start-ups, primarily companies that have emerged from Skolkovo, Russia’s most widely touted technology hub outside Moscow, will be able to trade their shares through private placements using the special IPO Board platform, an ‘issuers’ incubator’ originally created by the MICEX and now serving as the IIM venue for privately-owned companies to meet and negotiate with investors. The latter will be short-listed to predominantly include institutional and VC investors, according to Kommersant.
Of a total budget amounting to 30 million rubles, approximately $1 million, 4 million rubles will be allocated in 2012-2013 for project screening and packaging. The alliance is starting small with “a few deals a month” and has high hopes for expansion after it reaches a “critical mass of participants, investors and proposals.” RVC is also reportedly bringing its expertise to the table and facilitating connections with venture partners across the Russian regions.
The new project is joining the ranks of international innovation facilitators like the London Stock Exchange’s AIM, PLUS, NYSE Alternext, Warsaw SE’s New Connect Market, and the U.S.’ SecondMarket.com.
Alexei Lukovenko, CEO and board member of Moscow’s National Outsourcing Company and once a full-time investment advisor to the CEO of MICEX, hails this initiative as a boost for innovation in Russia. In an exchange with East-West Digital News, he explained that all such alternative market platforms provide “a range of opportunities to structure IPOs for small-caps as a private deal, or as a private deal with some ‘interference’ of standards relevant to a classic IPO/SPO,” which is unavailable at conventional exchanges.
Mr. Lukovenko believes that, with proper exit guarantees, the program will prove viable as “such guarantees matter more to business angels/VCs and PE investors than anything else.”
