Vnesheconombank and Russian Start-up’s Expert Platform Promoting Expert Services
Vnesheconombank and Expert Me have agreed to cooperate in promoting the Expert Platform, Russia’s leading provider of expertise. “Russian companies and foreign businesses that either have an existing presence in Russia or are looking to gain entry into our market can use the Expert Platform to get first-rate industry expertise from tens of thousands of leading independent consultants as promptly as possible. This also helps Vnesheconombank, as a development institution, to pursue one of its principal goals: creating the conditions for improving the quality of managerial decision-making; obtaining quick, high-quality and affordable expertise for investment projects; setting up high-technology start-ups and optimising the existing production processes in the real economy,” Vnesheconombank’s Senior Vice-President and Expert and Analysis Directorate Head Dmitry Ivanchenko said.
The Expert Platform will bring together business consultants, auditors, production managers, bankers, financiers, IT developers and venture investors. “Early-stage expert support adequately and promptly provided for projects considerably reduces their risks and makes it possible to avoid incorrect market assessments or business model mistakes, understand key factors in success in the niches in the market and create new jobs,” Dmitry Ivanchenko said.
Cooperation with Vnesheconombank provides innovators with new opportunities. “There are plans to reach our ambitious goal of creating the Russian market’s leading platform with fully digitalised services. Expert Me today is 3,000 industry experts, more than 200 completed projects and expert opinions a year. Our clients are companies in the real economy, consultancies. Together with Vnesheconombank, we have plans to increase the number of experts to 50,000 and reach several thousands of expert opinions per year. We are considering a new level in the long run: Russian expert services offered globally,” Expert Me CEO Ilya Bindyuk said.
In contrast to traditional consulting and other solutions, the Expert Platform promoted by Vnesheconombank and Expert Me provides high-quality advice from industry experts and offers prompt and affordable services. The Expert Platform will be of interest to Russian and foreign companies, banks, investment and venture capital funds, financial market participants and federal and regional authorities. The range of services offered is very comprehensive: consulting and auditing for business and financial models, performance evaluation for business units, potential expansion into new markets, market research and foresight, possible operations transformation.
With an annual turnover of more than 500 million US dollars, the expert services market has shown steady growth since 2010. According to IBISWorld, the three largest providers of expertise account for over 75% of the industry’s total revenue in 2017. There has been a trend towards higher market concentration over the past five years. As estimated by market participants, more than 500,000 projects are evaluated by experts networks every year.
Tens of Thousands of Lone Elderly People to Receive New Year Presents
The Enjoyable Aging Charity Foundation initiative to collect New Year presents for lone elderly people was supported by dozens of companies and organisations, including Vnesheconombank and its partners.
The initiative is open to anyone. Participants can personally buy a present and deliver it to any collection point in more than 30 Russian regions, make a donation to the Foundation or play the role of Father Frost. Thousands of lone elderly people have recently sent letters requesting some present or other. Every day the Foundation’s volunteers and partners supporting the initiative deliver small but welcome presents to those who are alone today (detailed information about the initiative can be found the Enjoyable Aging Charity Foundation website).
The Enjoyable Aging Charity Foundation has collected as many as 29,300 presents to date. We are sure that Father Frost will please tens of thousands of elderly people more by New Year’s Eve. Participation in the project is absolutely voluntary and does not mean publicity. The Foundation’s partners supporting the initiative are, however, confident that a good example also deserves to be spoken about.
“The New Year is a time when it is particularly important to let lone elderly people know that we remember and love them; we have organised the collection of New Year presents for them for many years. This year the project became a nationwide initiative of a large number of caring people. We are pleased that dozens of large public organisations, businesses and thousands of people have joined us with the noble aim of giving New Year festivities to the elderly,” Liza Oleskina, Director of the Enjoyable Aging Charity Foundation, said.
Vnesheconombank volunteers provide assistance for more than 850 residents of three retirement homes in the village of Dubna, Tula Region, in the town of Vyshny Volochyok, Tver Region, and in the village of Ostashyovo, Moscow Region. The Tula Region-based nursing home has already received presents from Vnesheconombank employees, and Vyshny Volochyok will be visited by Father Frost this week.
“With a little effort, we can each do a really good deed and help those who actually need it. We held a meeting with our staff members to decide on support for volunteer projects, but participation in volunteer projects is completely voluntary. When a donation comes from a company’s budget, this does not give any energy. When a donation is personally made to someone in need, this is quite a different story. The New Year is coming quickly, and these wintertime festivities have already become warmer for a lot of people,” Vnesheconombank’s Chairman Sergey Gorkov said.
The Enjoyable Aging Charity Foundation initiative has already been supported by the Agency for Strategic Initiatives; Immortal Regiment; Vnesheconombank and its subsidiaries; Gymnasium; Far Eastern Federal University; Trendy Kids, Samara; Dental Fantasy; Child of the Universe; Volunteers of Russia; Lefkadia Valley; Invitro; I love running family; Kids Office; Coffeemania; Philanthropists of Siberia; Moscow Municipal Pedagogical University; National University of Science and Technology MISiS; Moscow Engineering Physics Institute; Moscow Bank of Sberbank; Gorky Park; Russian Post; Russian State Social University; RUSAL; Synergy School of Business; Synergy University; SIRIUS Centre for Education; Skolkovo Foundation; Skolkovo Ventures; Sparta; SPLAT; You Are Not Alone; Horoshkola; Young Army Cadets.
Regional Managers Present Projects for Vnesheconombank’s Portfolio: 112 Applications Received
Vnesheconombank held the second meeting of its regional managers on 18 and 19 December. The event brought together managers from 52 Russian regions of the Russian Federation after a multi-stage selection process, along with representatives of the business community and authorities.
Speaking about the performance of the first batch of selected managers, Vnesheconombank’s Chairman Sergey Gorkov said, “The new operating model has already produced results. Within one and a half months, the Bank received from regional managers as many as 112 applications, including 20 under preliminary examination and three projects in the active development stage already. It is important to understand that Vnesheconombank is looking for high-quality projects that would be consistent with the Bank’s new strategy. The VEB 3.0 Strategy is to build the country’s innovative economy, providing a national platform for the development of public industries. It is a new approach and new kinds of tools.”
“Vnesheconombank has adopted a fresh approach to searching for investment projects and choosing them for the Bank’s lending portfolio, building up a network of its representatives on a nationwide scale. We appointed 84 regional managers in 52 Russian regions. They will select projects with a value of 1 billion roubles or more and with a completion period of five years, which correspond to Vnesheconombank’s new strategic priorities, and projects for the project financing factory. Vnesheconombank’s new model for regional operations is aimed at creating a wide project funnel and looking for projects in the regions. For this purpose, we have regional managers, an online platform and our partners,” Vnesheconombank’s Deputy Chairman and Member of the Board Alexey Ivanchenko, who supervises the project, said.
In recognition of Vnesheconombank’s regional operations, General Director of the Agency for Strategic Initiatives Svetlana Chupsheva said, “We expect to see interesting projects from regional managers as early as next year. The agenda of the next meeting of our Supervisory Board will include remodelling our operations in the regions and changing them to a mechanism similar to Vnesheconombank’s model. It is very important that government officials should understand how to work as a team. And above all, government officials view businesspeople as partners. This project-based approach is beginning to take shape. We see this in practice.”
In his speech, Russian Transport Minister Maxim Sokolov noted, “Vnesheconombank has great significance to transport development, particularly at regional level.” Maxim Sokolov told the audience about strategic planning documents, described transport infrastructure development, and spoke of the goals of the new transport strategy until 2035. “In early 2018, together with the Ministry of Economic Development and the Ministry of Finance, we will prioritise the projects on the principle that a greater effect should be achieved with less government spending,” he said.
Speaking about the problems in the implementation of investment projects, Chairman of the Financial Markets Committee of the State Duma Anatoly Aksakov said, “Businesses usually criticise credit institutions, referring to their projects that banks cannot finance. … Syndication and securitisation will enable us to have more resources to finance projects.”
Novgorod Region Governor Andrey Nikitin drew attention to the basic principles of regional investment policies. In his opinion, there are only four of them: resources, competencies, logistics and geographies, along with government support.
Speaking about risks associated with new business projects, Director of the Internet Initiatives Development Fund Kirill Varlamov said, “In the case of a start-up, you should always be prepared for a failure and mentally admit it. The paradigm of project management does not work very well here.”
Kirill Androsov, Managing Director of Altera Capital, spoke about the most difficult stage of a start-up business, from seed capital to Series A financing. Most start-ups fail to reach the end of this period. “The conversation with a project initiator begins with the product. They must answer a simple question: ‘What is the product that you are selling?’ If within five minutes I can’t understand what they are talking about or what they are selling, it’s like a red signal for me. If I can’t understand it, it is unlikely that it will be understood by a wide range of B2B or B2C customers. The second question is about the market. The market should be large, growing and global,” Kirill Androsov said.
During the event, Vnesheconombank signed agreements with the second and third batches of selected regional managers and gave them certificates. From that moment, regional managers became official representatives of Vnesheconombank.
Blockchain-Based Project for Real Property Registration to Start in January 2018
Vnesheconombank’s blockchain commune has hosted a meeting discussing the launch of the joint pilot project of Vnesheconombank and the Federal Service for State Registration, Cadastre and Cartography of the Russian Federation to use blockchain solutions for the registration of real property. The meeting was attended by First Deputy Prime Minister Igor Shuvalov, Vnesheconombank’s Chairman Sergey Gorkov, Deputy Economic Development Minister and Head of the Federal Service for State Registration, Cadastre and Cartography Viktoria Abramchenko, Head of the Federal Taxation Service Mikhail Mishustin, representatives of agencies and non-profit organisations. The meeting discussed the project’s main objectives and the possible deadlines for its phased implementation.
Igor Shuvalov emphasised the need to ensure that the blockchain solution for the registration of real property would be fully functional before making amendments to legislation. “It is important that the new system should be convenient for people and reduce their expenses. A digital economy should be able to provide comprehensive services, jointly using private and public resources,” the First Deputy Prime Minister said.
“Vnesheconombank is carrying out six blockchain-based pilot projects, but the project for the Federal Service for State Registration, Cadastre and Cartography is currently the largest and most important. The launch is scheduled for January 2018. The database of real property will be exported from the Federal Service for State Registration, Cadastre and Cartography into the blockchain, and people will be able to use it. The access interface will enable users to see and understand the blockchain component of the database,” Vnesheconombank’s Chairman Sergey Gorkov said.
“A lot of countries have announced their intention to introduce blockchains into the real property registration systems, and we are beginning this process as early as January. We want to test the technology, assess its benefits for users of our services. Its obvious advantages are data continuity, transparency and transaction speed. In addition, we are investigating the possibilities of employing machine learning technology for automatic legal due diligence of transactions. In combination with blockchain technology, this can restructure all governmental information resources in the near future,” Victoria Abramchenko said.
“Blockchain technology is able to protect information from misuse and facilitates data control. It will allow people to remotely receive legally important services, businesses to reduce costs related to control measures, the government to apply more sophisticated technology and, in general, rebuild processes and manage information in a new way. Blockchain technology has the potential for bringing down infrastructure costs with improved reliability and security,” a spokesperson for Igor Shuvalov’s office said.
New Laws Given Their Third Reading and Approved by State Duma to Improve Vnesheconombank’s Development Institution Activities
A new law “On Bank for Development” and related laws (amendments to the Tax Code and customs regulation) have been given their third reading in the State Duma and approved. The restated law on the development bank clarifies Vnesheconombank’s goals of implementing investment projects for high-technology industrial production, infrastructure, digital economy development and innovation, providing support for Russian industrial exports and helping Russian industrial producers to expand into foreign markets.
“The draft law passed by the State Duma gives Vnesheconombank new functions and instruments for their performance. The document specifies, first of all, participation in syndicated lending, which is the key mechanism of the project financing factory. The factory’s goal is to encourage investment to industrial production, infrastructure, innovation and the digital economy,” Chairman of the Financial Markets Committee of the State Duma Anatoly Aksakov said.
The new law provides for new functions of Vnesheconombank and instruments for their performance, including:
- mezzanine financing and partner financing are used to attract long-term investment and provide Russian companies with wider access to financial resources in the domestic and foreign markets;
- Vnesheconombank has a leading role in supporting projects of the National Technology Initiative and digital economy projects;
- a separate objective of Vnesheconombank is to help Russian industrial producers to expand into foreign markets, which includes issuing Vnesheconombank with tax and customs guarantees to secure Russian companies’ obligations to pay taxes and customs duties;
- Vnesheconombank’s role is defined for projects implemented by the Russian Federation in the area of promoting international development and integration processes (Eurasian Economic Community, Shanghai Cooperation Organisation, BRICS, One Belt and One Road Initiative);
- Vnesheconombank performs a wider range of expert and analysis activities in order to identify factors in Russian economic growth and search for and select projects consistent with such factors, taking into account their impact on sustainable development and energy efficiency enhancement and private investment in these projects.
The draft of the federal law on amendments to certain legislative acts of the Russian Federation in relation to syndicated loan transactions is aimed at resolving legal uncertainties in respect of the regulation of syndicated loan agreements.
“Streamlining the legal regulation of syndicated loans will increase lending in the real economy and make loans more affordable while reducing credit risks taken by individual lenders. Russian businesses will no longer have to enter into such transactions under foreign law. This will also make Russian jurisdiction more attractive. The draft law additionally amends certain federal laws associated with authorising certain types of economic entities to be syndicate members,” Vnesheconombank’s Deputy Chairman and Member of the Board Alexey Ivanchenko said.
The State Duma passed the draft laws aimed at improving the activities of Vnesheconombank as a development institution unanimously.
The draft of the federal law “On Amendments to the Federal Law ‘On Bank for Development’” was submitted by the Government of the Russian Federation on 14 July 2017, is aimed at improving the activities of Vnesheconombank as a national development institution, building its activities on Russia’s national strategic goals and long-term development priorities and providing regulatory support for the implementation of Vnesheconombank’s approved new Development Strategy until 2021.