Venture investment in the Russian market totalled USD 910.6 million in 2012
The third review from the MoneyTreeTM Russia series prepared by PwC’s Center for Technology and Innovation (PwC CTI) and RVC analyses venture investments in Russia in 2012. This publication focuses on the information technology (IT) sector, where we compare venture investment trends over a two-year period. Also, for the second time in a row, our analysis covers two additional sectors: biotechnology and industrial technology.
As previously, the IT sector accounts for the greatest amount of venture capital raised: in 2012, companies in the sector raised USD 792.1 million, or twice the amount raised in 2011. Biotechnology and industrial technology still lag behind the market leader, IT, both in terms of the number of deals and the volume of investment raised. The 2012 results show 18 deals worth USD 108.4 million in the industrial technology sector and 15 transactions worth USD 10.2 million in biotech.
Overall, 2012 saw an end to the wave of "overhyped" startups and unjustifiably inflated investment expectations. Last year, investors demonstrated a more careful approach to selecting portfolio projects, favouring those whose owners had managed to show a tangible record of business success and realistic prospects, rather than mere talk.
Also, 2012 saw venture capital funds being more active in meeting the needs of more mature companies. This affirms the willingness of investors to allocate significant funds to promising companies. This year, we have noted 12 investor exits from projects with an aggregate worth of USD 372 million.
Round B in IT-sector saw the greatest inflow of capital, with USD 160 million raised for 14 deals concluded in 2012