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October 03 | Innovation

Why Venture Needs Business Angels; Engineering Contest to be Held in Saint-Petersburg

International gathering of business angels was first held in Russia, in the Samara region on the 23rd-24th of September. Within the framework of the event, experts of the Russian Venture Company (RVC) and the National Association of Business Angels (NABA) told on their opinion on the main trends in the Russian venture capital market and the role of business angels nowadays.

Business angels are private venture capital investors that fund projects at early stages, making this business more risky. From average investor they are distinguished by a larger involvement in the project. They support the nascent company not only with money, but also with relationships, experience, tips, finally, a simple human interest.

The term "angel" appeared in the early twentieth century in New York and applied with respect to secured Broadway fans who invested in local theater productions. Later the term began to designate all private investors, though, in fact, business angels' activities appeared long before the birth of the concept.

"Throughout the world, business angels are the driving force of innovation and technology, - president of NABA Vitali Polekhin explains. -

Behind every great technology company a business angel has been at the beginning of its activity. He believed in the project when there was nothing to be seen, when there were not some rational measurable metrics. The man tried to understand the project and saw billions behind it."

Today, business angels are becoming an integral part of the Russian venture capital ecosystem. "We can say that they are at the beginning of this food chain", - Gulnara Bikkulova, development director, board member of RVC, adds. She told about the main trends of the Russian venture capital market.

Gulnara_Bikkulova Gulnara Bikkulova

Such years as 2013-2014 proved to be very successful for the venture capital market in Russia. In latest two years, the activity decreased, but nevertheless, the market continues to grow. Firstly, there is the growth of "angelic" movement: more and more communities are formed (Venture club, Startrack, Investors Club Skolkovo). Also, activity of Russian investors is increasing on the international market.

State support instruments are getting stronger too: it’s about investment funds, grants for start-ups, information and analytical support and educational programs. Major private capital is attracted to the venture projects more often: at least, 19 members of Forbes-2015 list finance the various venture projects. There are large angels-leaders in the regions. Through their success stories, they attract new angels to the market.

In general, Russian venture capital market is very small and comprise only 1.5% of the world’s market, but this figure is a result of joint efforts of venture capital funds and private investors.

"Least of all venture capital market needs inexperienced business angels, who invested unsuccessfully in the business, and then got disappointed in this activity", - Polekhin says.

Meanwhile, recently there was a meeting in the Ministry of Education and Science of the Russian Federation at which the organizers of the All-Russian competition of engineering (RCE) discussed with the staff of the leading Russian companies the course of preparations for the RCE in 2016, as well as prospects for its development. Special attention was paid to the idea of creating not only a system of competitive events, but also a wide network of engineering competitions, a kind of "club" of young talented engineers under the RCE brand.

"I would like to hold a number of additional competitive activities aimed at developing the students' organizational skills and ability to work in team," - Alexander Gordeev, executive director of the All-Russian competition of engineering, said at the meeting.

It is planned to hold team hackathons within the framework of the final event. The finalists of various competitions will together solve tasks.

The most important goal for the organizers of the RCE is to create high-quality tasks for the winners of the preliminary steps to make this federal competition in the area for the cultivation of engineers of tomorrow. "Without the participation of companies and corporations, but if only universities tackle this problem it is unsolvable," – Gordeev noted. According to him, now there are many mechanisms for the development of technical creativity in technical universities and large corporations: "fablabs", workshops, scientific and educational centers, specialized groups. It is necessary to estimate how these mechanisms work and to create on their basis a system of elite engineering education in Russia under the brand of RCE.

All-Russian competition of engineering is an annual event in which the winners of the competitions of professional high-tech industrial enterprises are found. Firstly, there are students of engineering colleges, seeking ways to implement their own bright ideas and initiative projects. Others are talented students, graduate students and young scientists involved in finding solutions to the challenges posed by industrial enterprises.

Therefore, along with the competitions of corporations, the championship of individual projects among students and graduate students is held. The event is organized by the Ministry of Education and Science of the Russian Federation.

The current structure of competitive events is preserved, although the composition of the corporate competitions has changed to some extent. So, this year a contest within the RCE will be held by GS Group. 9 companies and state corporations will hold the championships of young engineers in their areas, and contests by Oleg Deripaska Fund "The Free case", the race «Smartmoto Challenge Moscow 2016", organized by MPU, and international competition for student teams "Solar regatta."

Gala finale, which will bring together all competition finalists and where winners will be announced, takes place on the 18th of November in Saint Petersburg State Polytechnic University named after Peter the Great. The Fund for Infrastructure and Educational Programs of “Rusnano” will be co-organizer of the event.


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