№1. Internal growth
Over my 20 years in banking, I lived through all phases of this sector’s development: from pure adrenalin at the start to well-systematized business. Unfortunately, now it’s more about survival than development. The players are getting bigger, control is dominating creativity. I have always been leaning towards entrepreneurship and innovations, back in the bank, we had a wonderful and very successful team. In 2014 I and my partners had successfully withdrawn and I started to look for new ways to realize my strategic interests. And I saw a new way of personal development in private investment. Of course, I had to give up “corporate rules” and assimilate into new venture sphere.
№2. Personal example
On StartupVillage 2014 my interests finally became a personal strategy. A brave new world where innovations are not books or dreamlike cases, but real people, projects and achievements had declared itself to me. I saw doors through which one could enter this originating sector of the Russian economy. I was inspired by professionalism and scale with which the government supported the venture and startup industry, and also personal stories of investors who had already managed to succeed. Each of them played a big role in me gaining knowledge and new contacts and in dragging me in angel investment.
№3. Good Infrastructure
Today in Russia it’s easier to become an angel than ever before: all infrastructure is ready. There are NABA (National Association of Business Angels) and RVC (Russian Venture Company) with their own education programs and conferences. There are some federal startup contests, clubs for investors are ready to help to select projects and participate in syndicated deals. Today SmartHub also became a part of infrastructure: from 1’th to 2’th of august in Kaliningrad will be “Ready for Equity Weekend”, an intensive program of preparation of private investors to making venture investment deals. It will be a great opportunity for future local investors to learn about the proven experience of market leaders, get their advice and learn about key rules of this castle. For another thing: we are expecting to see a large number of speakers, investors, and listeners from other regions — that will help draw attention to innovative activities in Kaliningrad Oblast.
IIDF’s (Internet Initiatives Development Fund) accelerator is quite successful, “Skolkovo” fund supports with infrastructure and co-investment. The dilemma is how to hold projects and talents in Russia and stimulate more mature investments. Today tech startups struggle with, for example, importing test freights of complex equipment and procurement, certification. Mature projects who are looking for major investments for scaling in world markets also have their problems. These problems force some teams to choose more comfortable countries and leave.
№4 Unoccupied niches
Being a businessman I immediately decided that I would not only invest in venture active assets but also build a successful business in this market. Together with my partner Olga Dorofeyeva who is experienced in marketing and IT, we founded SmartHub. After well-systematized banking business, we saw that unqualified venture investors demand quality consulting services. We position SmartHub as a venture boutique, offering portfolio formation services on a turnkey basis: we establish strategy and profile, select appropriate projects, make deals, and track project progress. We developed our own projects evaluation method and trying to make projects selection process effective not only for us but also for the startup. After 8 months we made 10 deals for 40 million roubles in total, our commercial geography — Russia, UK, Lithuania, and Israel.
№5 Building a future
Participating in venture investment drastically broadens the knowledge horizons about the newest technological trends, investment directions, and business models. Angel investment allows you to become familiar with projects which are implementing the innovations in everyday life and, therefore, are building a future of the world today. At work, I have an opportunity to communicate with interesting and successful people and also with young and energetic entrepreneurs, who are not afraid of taking risks and responsibilities. It fills you with confidence about the success of innovations.
№6 Financial benefits
Venture investments are, of course, attracting people with their financial potential. The risks are high, but the level of yield is also high. It’s too early to talk about how successful my investments are, because first of them was made just half year before. But even at this short distance there is an example of project making new round at a rate 2 times higher then the one with which I entered. We estimate that resulting yield of SmartHub will overtop 30%.
№7 Labor of love
Being a private investor drastically changed my life. You are not just working your day from 9 to 18, obliging corporate rules, but completely espouse to your labour of love in periods of inspiration and top productivity. You have more time for the family, sport, travel and there is no such thing as a workplace requirements. Me and my team created a “perfect office”, which stimulates our creativity. Fantastic view, lots of functional areas, bright colors, high quantity of illumination, absence of personal working places — you work where it is comfortable for you at that particular moment.
Schedule bends. Usually, it is 2-3 contacts with portfolio companies or with teams which we review for investment per day. We spend some hours per day on developing SmartHub and communicating with investors. Twice a month it is necessary to go to business trips, usually to Moscow: it includes visiting investment sessions of VentureClub and Skolkovo club of business angels, different contests, meeting with partners and projects.
VENTURECLUB OPENED THE OFFICE IN KAZAKHSTAN
VentureClub: oneyear track record