New investment fund with focus on tech start-ups established in Russia

New investment fund with focus on tech start-ups established in Russia

Russia’s largest lender Sberbank and Russian Venture Company will launch a new investment fund focusing on technology and science-intensive start-ups. The project is expected to contribute to the development of innovative technologies and the formation of a corresponding culture in Russia.

Russian Venture Company (RVC), which is a unit of the sovereign Russian Direct Investment Fund (RDIF), and state-backed lender Sberbank are launching a joint $100-million fund to invest in start-ups, reports The National. The new establishment is designed to focus on early-stage technology sector ventures based in Russia or planning to enter the local market. The partners intend to leverage the RDIF’s network of international partners and establish synergies with projects that are already part of Sberbank’s investment ecosystem.

RVC is a fund of funds investing into other managers in order to develop Russia’s venture capital market. It was recently brought under the control of the RDIF, which has about $10 billion in assets under management and $40 billion of commitments from its partners. “We plan to actively work on investment into new funds,” said CEO of the RDIF Kirill Dmitriyev pointing out that the joint venture with Sberbank would help to “create new opportunities to select, support and successfully develop attractive projects”. According to Dmitriyev, such projects “can make a significant contribution to the creation of innovative technologies and emerge as important drivers of Russian economic growth”.

CEO of Sberbank Herman Gref opens training centre for programmers School 21 in Kazan, February 2021. Photo: Rinat Nazmetdinov

“No such element for the support and development of small, innovative businesses existed in Russia previously,” stated Chief Executive of Sberbank Herman Gref. He said that the partners aimed to “establish a culture of technological and science-intensive entrepreneurship in Russia”. “Launching a fund for early-stage start-up investment is the first step towards the implementation of Russia’s Innovative Development Strategy and the reform of development institutions being prepared by the Russian government,” said Gref.

Sberbank, which is backed by Russia’s Ministry of Finance, accounts for almost one-third of the Russian banking sector’s total assets. The bank has recently pivoted towards investing with a focus on technology companies and now positions itself as an “ecosystem” of tech firms supporting its core banking operations. Some of these technology companies are already active in the Middle East, while others are seeking market entry.

By Anna Litvina