Playing to the gallery

Pioneer Venture Capital in Silicon Valley, Franklin, Johnson did not come from one of its portfolio companies for 26 years. Business portfolio companies develop progressively rather than jumps, so the usual volume of the "transfer of business to a new stage" for the investor is almost non-existent. "Conditional division at seed stage, start-up and growth stage for the investor has no fundamental significance, it focuses on cash flow and capitalization" - explains managing partner of Runa Capital Dmitry Chihachev. "For venture capital funds it impossible for venture capitalists have certain obligations to its partners - the general partner of Helix Ventures Eugene Zaitsev. - Much depends on the agreements between investors and management company, but most of all, as soon as the company has a liquidity fund is obliged to go out of business and distribute the money received from selling it. " However, as it clarifies Evgeny Zaytsev, there is another important aspect: the sale must realize profitability, investors expected. «IPO - this is not the criterion for success, as a way to achieve liquidity and to attract funding not only larger but also less expensive than venture capital investments", - stressed Dmitry Chihachev. The fact that venture investors are guided by the yield of 20% per annum and above. Given the fact that high-risk business, successful project must not only ensure their own profitability, but also to recoup the losses from unsuccessful projects. So, to meet the expectations of investors, company management must provide an annual growth of capitalization of the company not only in the dozens, but hundreds of percent. At the same time a shareholder who buys securities on the open market the company is unlikely to be a claim if the company will be able to appreciate at least a little faster than the stock market index. Minus 40. However, well defined time to sell the project is far from over and is not always the case. One of the most iconic and indicative IPO in the history of the business venture was a public offering of an "ideal start-up» Google in 2004. Accommodation has been repeatedly postponed - not only because of delays in regulatory approvals United States, but also because of the constant changes in the strategy of the company. As a result, the moment was lost, the conjuncture of the stock market has deteriorated: the final placement price was almost 40% less than expected, and even then it could not accommodate the entire volume-planned. Did not help even the "innovative" approach to the procedure: in order to equalize the opportunities of large investors to small, the company created a special site for receipt of applications to purchase shares of the company: only instead of the planned $ 3.47 billion Google managed to collect only $ 1.67 billion, however, and this the result was not so sad: capitalization of $ 23 billion, which immediately made Google one of the largest IT-companies in the world. Now on the VC market has a few major players, waiting for IPO which is comparable with the expectation of IPO Google. First of all, because if the decision to sell to a strategic investor would be Google, perhaps the only player on the market that have available funds for their purchase. For example, the world's largest social network Facebook is estimated by some analysts at $ 60 billion company has already a lot of shareholders - more than 500, and this year it will have to report their financial results, becoming so public without a public offering. However, placing the company may never happen: about $ 50 billion in available funds from Google makes market participants to speculate about buying Facebook IT-giant. The opposite situation to the service of collective discounts Groupon, whose IPO is not less than anticipated. In the two years since a small c Groupon most active investors - Battery Ventures, Accel Partners and New Enterprise Associates - invested in the company about $ 170 million, but now it is estimated to be ten times more expensive. Negotiations on the deal Google and Groupon in December came to nothing: the amount of $ 6 billion, more than 2 times higher than originally proposed, did not work for the company's management. So now that the Western media claims that the company hold an IPO before the end of 2011. It's time. According to the Russian Venture Capital Association (RVCA), IPO in Russia until recently it was extremely rare form of investor exit from the project in 2008 and 2009, including the realized output did not appear any IPO to 20 and 9 respectively of transactions on sale. However, in 2010 the picture changed after the creation of the site on the MICEX "Market for Innovations and Investments" on it have already been enlisted HSCI ("Institute of Human Stem Cells", although the actual IPO took place in 2009, formally report it has been closed later), "Plant Environmental Technologies and ekopitaniya" Diode "," "Pharmsynthez" and "Russian Navigation Technologies." The real breakthrough came in November last year, when the Russian Internet holding Mail.ru Group raised in an initial public stock 16% of the $ 912 million book requests was closed for four days earlier than expected, and all the papers were placed at $ 27, 7 - that is, the upper limit of the established price range, even at that price the demand exceeded supply by 20 times. The company's capitalization was $ 5.7 billion, and the next day the shares were worth $ 36. This success has led analysts to talk about a possible investment in the booming Russian Internet projects and to predict the imminent IPO «Yandex», whose leadership has stated that it intends to conduct a public offering on the wave of investor interest after Mail.ru. Publicity - not for everyone. However, experts do not expect that public offerings in the foreseeable future will be the prevailing practice for the Russian venture capital companies. The fact that the possibility of the IPO is limited to a few formal criteria. "One of the factors - whether realized returns that an investor expects from the project," - adds Eugene Zaitsev. Since the services are expensive organizer: a couple of years ago it was believed that a public offering makes sense only if its amount exceeds $ 100 million Today innovative companies have overcome this barrier - the size of IPO, passed on an innovative platform MICEX, calculated only hundreds of millions of rubles. But the cost of such accommodation, according to unofficial estimates, may reach 10% of the volume, so that, in spite of the impressive, such a step might be for the owners of the company altogether unprofitable. "For the IPO requires a certain minimum size of the company, not all such option is possible, and, conversely, a large company it is very difficult to sell strategist - just not enough buyers who can afford it", - says Dmitry Chihachev. "The strategic investor can buy a small company, and the IPO is for companies that show the dynamics of growth or future growth, the biggest market in the future, and good financial performance" - I agree with him managing partner at venture capital fund Almaz Capital Partners, Alexander Galich. Public offering is more suitable for companies with strong product line and great sales. "Only in this case, these companies will be able to realize higher returns for their investors through this IPO», - sure Evgeny Zaytsev. Purchase of a strategic investor - it's more realistic prospect, says Evgeny Zaytsev. "It's much easier and the transaction is much" cleaner ". Most of the innovative start-ups from the beginning think that the more profitable sales, not the IPO », - he said.