Those who develop and sell to get more money

On February 27, 2012 Igor Agamirzian, JSC Russian venture company CEO and Board Chairman made a speech at the Academic Council meeting of the P.N. Lebedev Physics Institute of the Russian Academy of Sciences (PIAN). Igor Agamirzyan spoke about the institutions of development and the innovation system in Russia, the role of the Russian Venture Company in the venture capital industry and technology entrepreneurship development, and then answered questions of scientists.

In his report, Institutions and the innovation structure of Russia: the role of the Russian Venture Company, Igor Agamirzian gave a detailed commentary on the position of the Russian innovation sector in the global economy. PIAN Inform site notes the following.

In recent years, a fairly complete and effective system of institutions was created in Russia due to the efforts of the government and the President. The system is connected with the activity of Modernization and Technological Development of Russian economy Commission. The system seeks to reorient Russian economy with the resource base to a more technological way of development. In fact, many countries occupying the leading place in the modern economy have gone through it. Today the economy has a much greater level of globality and transparency than it was before.

Modern economy has no self-sufficient entities. The world economic system is based on competitive co-operation, when different countries and participants contribute the elements of their activity not only competing but also cooperating. It happens because in the global division of labor when creating technological products in the supply chain it is more efficient to single out a specific area rather than try to reproduce the entire chain.

Now Russia faces a fundamental problem which has not yet been resolved ideologically - what place do we want to take in the international division of labor? We are accustomed to self-sufficiency, but we should be honest and realize that such self-sufficiency like during the Iron Curtain period will never appear. And it was not anyone’s desire, but it is the world’s objective development.

2008 great economic recession in Russia was deeper than in developed countries. It showed weak economic ties between the Russian and the world economy.

Very often our state structures do not explain the decisions made. That is, what and what for something is done is not explained. As a result these decisions hang misunderstood by the society. The institutions development system in the country is being created to solve the problem of constructing a certain (it is difficult to say so far which exactly) unique offer by the Russian economy for integration into the global economy.

We should build the production with high value added per employee in this industry. There is an interesting fact that in the life-cycle chain of any technology product marginality has maximums at the initial and final stages. At the stage of production marginality sharply falls and may even become negative, but then at the stage of sales it increases dramatically. Most of the money is earned not by the companies which only produce but those able to develop, on the one hand, and to sell, on the other hand.

Currently, the main RVC’s task is to create venture capital funds that are invested not in production projects, but in companies focused on the development and commercialization of intellectual property. In other words, the RVC’s task is to provide the funding of new companies through created funds, which can later be picked up by RUSNANO or other development institutions (for example, Vnesheconombank) for the implementation of industrial projects.