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5 Sep, 2007 05:11

Angels boost Russian business

Business angels are people who put their own money and experience into innovative start-up companies. The term comes from Broadway, where individuals invested their own money in risky stage productions.

Today’s investors are more practical about the returns, and the latest Venture Forum in Moscow saw risky high-tech innovative projects get off the ground with the help of the so-called “business angels.”

One of such projects is the production of an already existing super-efficient solarium which uses as much power as an electric kettle. It has only one third of the light bulbs of a regular tanning machine. The secret lies in the mirrors that maximize the ultraviolet light.

The makers went to a business angel to help them produce it on a commercial scale.

“It’s not the money that is the most important thing in the project. A business angel gives you his experience and useful contacts,” says Sergey Mikhailov, inventor of the Miro solarium.

Sergey has been successful because he is not just an inventor, but also a businessman. Before he found his business angel, he was prepared to sell his house to get his solarium into production.

It’s this kind of determination that attracts business angels.

They say most ideas never get out of the university lab because their inventors have no idea how to market them.

“Russian scientific institutes have never taught business,” grieved Oleg Manchulantsev, a business angel, from Moscow Venture Forum.

Oleg came to Russia from Belarus to work as a marketing specialist and made his first million by the age of 25. 

“At that time I wondered what would I would tell my grandchildren. I realized I wanted to build a billion-dollar company. That’s when I decided to learn how the business end of innovation works,” explained Oleg.

He is a founder of Moscow’s Venture Forum and now has several innovation companies under his wing.

Another business angel, Vadim Asadov, made his fortune in oil and gas. Now he devotes his time and money to hi-tech angel projects.

“I prefer to have 5 dollars on each dollar I invest!” declared Vadim Asadov, a business angel, of Neurook LLC.

Alongside his projects, Vadim sponsors a business school in Yaroslavl, which he believes, will educate a new type of scientist – with business savvy.

“My goal is to have a good group of inventors who can say they are the next Bill Gates or Sergey Bryn. And with a clear, though not guaranteed, way to do it,” states Vadim.

Ten years ago Russian Sergey Bryn, and his American partner, sought money for their internet project from a business angel.

He wrote a cheque for a hundred thousand dollars, misspelling the company – and giving Google its name.

Innovators need to believe such success stories can happen in Russia. Business angels say they have a lot of money to invest. But for now, they still lack projects.