When you compare Russian and English-language analytics on venture business, you quickly come across an untranslatable difference - not in words, but in views, points of reference.

In Russia, most stories about ventures are stories about shaggy, bearded, bespectacled scientists and inventors. Sitting in a departmental design bureau or academic research institute, they came up with something like this. Often at the expense of the employer, using his reagents and equipment. True, the idea does not apply to the main job; the employer has no rights. Then creative people leave their “office” and turn their idea into a business. Until they fully get back on their feet, they are fed from the “mother” source, which provides them with a not too large, but guaranteed portfolio of orders or a salary.

In the USA, the birthplace of venture capitalism, stories about ventures are not stories about inventors, but about venture capitalists. They are not shaggy, bespectacled people at all, but people who can understand their language, soberly assess the prospects of their inventions and risk their own or other people’s money in the hope that it will be possible to build a profitable business on scientific and technological innovations. And that it is these bespectacled people, and not those in the neighboring laboratory, who will succeed.

There are many ideas in the world - they are no longer in short supply. There have never been so many people working for scientific and technological progress as there are now. Every second, some laboratory comes up with an innovation that can theoretically improve the life or business of a significant number of potential clients. But consumers from all over the world are separated from this laboratory by a gigantic distance, both physical and mental.

Overcoming it is an almost impossible task. Among the parents of small children there are many good storytellers - when they put their children to bed, they compose wonderful fairy tales for them that other children would be happy to listen to. But only one in a million home storytellers becomes H.H. Andersen, and even his stories did not bring him much success during his lifetime. What is in acute shortage is not good fairy tales for children, but providers capable of selecting the best storytellers from hundreds of thousands and investing in the infrastructure that will deliver these fairy tales to end consumers.

This is why the heroes of venture capitalism in the United States are not inventors, but investors and venture capitalists. Success is far from guaranteed - many glorious warriors died on this road. You can know all the letters and not guess the word (time to enter and exit the project). You can guess the demand for development and correctly calculate a successful team of researchers, but you will come across the bad character of the project founder, who will not agree to share control or will kill the project with poor management or simply personal incompetence.

Many companies that believed in the latest venture fairy tale - biotechnology (the second to last one was IT) have gone bankrupt or turned into zombies over the past seven years, Bruce Bus, a partner at the Atlas Venture fund, writes in Forbes: they made their bet at the wrong time. Now the situation in the world is the opposite - the pharmaceutical industry and financial markets are showing growing demand for securities of biotechnology companies, and their supply is limited. But this gap does not make the position of a venture investor any less problematic: it is not difficult to invest in biotech today, but it is much more difficult to guess what will grow out of a company tomorrow and whether anyone will need it.

The financial crisis has hit venture investors hard. The number of investors in the early stages of IT and biopharmaceutical projects has still not recovered from the pre-crisis level of 2006. However, this year promises to be very good for the venture capital industry. Although the total number of transactions remains approximately at the same level, their average size, as follows from statistics from Thomson Reuters and the National Venture Capital Association for the first half of the year, will increase by almost one and a half times.

The volume of funds raised by venture funds from private investors may approximately double this year. Andreessen Horowitz alone (which invests mainly in Internet companies) raised $1.7 billion—a lot of money by the standards of the venture capital industry. The number of exits from venture projects through IPOs may increase by one and a half times.

However, all these figures indicate not so much that venture capital has found a new gold mine, but that investors, thanks to the soft monetary policy of the world's largest national banks, have free money. More money is not always good. Not the best projects may receive them, and trust in ventures after the dot-com crash and the last crisis is a rather shaky thing.

A new technology bubble may be brewing as venture capitalists take on excess risk, warns Bill Gurley, partner at venture capital firm Benchmark. In the tech industry, the share of startups with negative cash flow (meaning the company is eating up equity capital) is now quite high, even higher than in 1999, before the dot-com crash. This is a consequence of overinvestment. When other investors are risk-hungry, you should be careful about investing, and when everyone is afraid to invest, you need to take risks, Gurley recalls Warren Buffett saying. Now investors are ready to take almost anything.

A large number of startups with negative cash flow is a very bad sign, agrees Fred Wilson, partner at Union Square Ventures. Neither in 2009, nor a decade earlier, you could get a job at a company burning through $4 million of capital per month, but now this is not uncommon. The rapid growth of companies such as Uber Technologies (a taxi service integrated into modern phones), Sidecar (which helps passengers choose a driver), and the growing popularity of Bitcoin-related startups may turn out to be one of the stages of an emerging “bubble.” Far from the last, many venture investors believe, but caution should be exercised.

The structure of the venture cycle may also be changing, says Todd Hixon of New Atlantic Ventures. Many companies at the seed stage no longer need several hundred thousand dollars, but more than $1–2 million, which you can no longer raise from “friends, family and a few idiots.” This forces entrepreneurs to build an organized business at an early stage, write a plan, hire employees, and look for consumers. But now many small venture funds and “super angels” are ready to provide seed funding. From an informally friendly seed stage (the path from an idea to a business) it turns into one that cannot be overcome without institutional investors. Their requirements for projects are obviously higher than those of their friends.

At the next stage (“A”), companies no longer need $1–1.5 million, as before, but about $10 million. Naturally, they go only to those who prove the efficiency of their business model (previously this happened at stage “B” ). “Now you can’t sell an idea at stage A; there has to be a steak on the table,” says Hickson. Stage “B” is thereby skipped, but at the next stage, companies often require about $20 million, or even $40 million, which only large venture funds can provide in exchange for a full-fledged entry into the market, expansion of the scale of operations and preparation for an IPO. the benchmark for such investments at previous stages becomes at least $100 million. If, say, 20% of the company’s shares are sold, then the entire company should be worth $0.5 billion.

In Russia, a dubious bet has been made on state financing of venture projects. Many other countries are also getting into this, a group of economists writes in the report “Public Venture Capital for Young Innovative Firms.” They consider the Australian and Israeli experience successful; but in 15 other developed countries, government funding did not allow significant private investment into the industry. For example, in Canada, the participation of a government fund in venture financing reduces the likelihood that the investee will be sold through an IPO or acquired by another company. Therefore, in Europe they are now trying to move from direct government funding to helping the venture industry through educational programs, benefits for R&D, etc.

Russia has not yet matured to this point. And the time is not right: uncertainty, terrible for business, has sharply increased. It has increased to such an extent that venture level risk is no longer typical for venture projects, but for the most ordinary projects. For example, in September IKEA announced a plan to invest €2 billion in the construction and renovation of Russian stores by 2020. But who can guarantee that during tomorrow's anti-sanctions Russia will not stop the import of furniture and parts for it? So it turns out that IKEA is a venture in terms of risk level, only the profits are lower and the investments are huge.

Perhaps the right thing to do in this situation was the Chairman of the Board of Rusnano, Anatoly Chubais, who in September asked for 100 billion rubles from the Welfare Fund for innovative technological projects. It would be a win-win. If not for one “but”. As usual, the spending of public funds and the soundness of venture business plans will be checked by the Prosecutor General's Office, the Investigative Committee, the Accounts Chamber, Rosfinnadzor, etc. Some of these bodies have already worked in Skolkovo.

Bespectacled people and translators