MOSCOW: Rostelecom PJSC and the Internet Initiatives Development Fund (IIDF) are establishing a strategic partnership, launched to develop the Russian venture capital market.
Rostelecom will collaborate with IIDF by joining the Fund’s Investment Division charter capital “IIDF Invest” – a shareholder in more than 350 IT start-ups. Rostelecom investments will boost the fund’s portfolio and help provide financing for new Russian start-ups.
Rostelecom’s investment in IIDF Invest will amount to RUB 2 billion, representing a 31.03% share in the Fund’s charter capital in total, with the first 18.36% secured in December 2019 and the remaining investment being finalised by the end of January 2020. Rostelecom representatives will join the investment committee of the fund.
IIDF Invest will use the investment proceeds to support new innovation projects and provide additional support to the fund’s most promising existing projects. The investment offer for start-ups will be reviewed, whereby pre-seed stage companies will get up to Rub 5 million of financing, while growth stage companies will be able to receive up to RUB 65 million.
Mikhail Oseevskiy, President of Rostelecom, commented: “Rostelecom has made great progress in transforming into a leading provider of digital services. From a growth perspective, I am pleased to see a stronger focus on innovative business streams, such as data centres, cloud, cyber security, smart cities, IoT to name but a few. The strategic partnership with IIDF is aimed at enhancing efficiencies in this area, identifying new growth drivers and expanding the ecosystem of digital services. These drivers might not always be obvious given the increasing speed of technological developments – somewhat ambitious ideas today, they can conquer markets and geographies tomorrow.”
Kirill Varlamov, President of IIDF and IIDF Invest, commented: “IIDF is always looking for new sources of financing to support its various investment streams. Our partnership with Rostelecom opens a new chapter in IIDF’s evolution as we will be reconsidering the investment cycle with a full commitment to supporting promising IT start-ups and growth companies and providing the entrepreneurs with access to Rostelecom’s unique expertise.”