Russia’s VC market: investment grew in 2014, but outlook “not optimistic” May 19, 2015, 11:42

According to this in-depth Russian-language analysis, last year Russian venture projects raised $788m in a total of 465 transactions. More than 70% of the investment came into IT and e-commerce projects. Please take a look at a few brief excerpts from the report:

«2014 was the last year that saw certain optimism on the part of investors in the Russian VC market regarding investment in domestic start-ups. Two dozen active funds drove positive dynamics in software, media and transactional deals in the first few months of last year; however, the market began to contract after the summer months… In that period, the number of cross-border transactions nearly equaled that of domestic investments… Following December, the high turbulence of Russia’s economy caused a major capital flight from the national VC market, with investors preferring to operate in more stable markets in Western Europe, Israel, Southeast Asia, and Latin America…

Most deals were closed in the first quarter when geopolitical tensions were not so obvious yet, and neither was a new wave of crisis expectations. Thanks to the successful first quarter, the volume of 2014 venture investments turned out to be much higher than that of 2013. Two years ago, it was just $399m, which means the volume doubled in 2014.

Nonetheless, looking at the remaining three quarters of last year, one can’t call the dynamics optimistic… The sag that we saw in the second half was a result of the macroeconomic and political uncertainties. Some investors took a timeout; others grew more cautious.»

According to RMG, the main investor in venture projects was the private sector, as it was before. Angel investors and private funds shelled out about $434m in venture projects at various stages of implementation.

http://marchmontnews.com/Finance-Business/Central-regions/21256-Russias-VC-market-investment-grew-2014-but-outlook-not-optimistic.html