Weathering the economic winter

“Выйди замуж за Морозка, станешь богатой”

Из русской сказки пересказанной В. Панюшкиним

 “Marry Father Frost, and you will become rich”

From a Russian fairy tale retold by Valery Panyushkin

In the longest of a recent spread of articles focused on Russia, the Economist begins its coverage in a restaurant, where items targeted by western sanctions have reportedly disappeared from the menu.  This is then linked to the imminent threat of an economic recession which Russia faces, following the introduction of sanctions against Russia.

The Economist is right that Russia does indeed find itself in a very precarious economic position.  However the idea that this has been predominantly brought about by sanctions is very misguided.  Russia’s biggest problems are entirely of its own doing.  And it is this very fact which should allow the ‘wounded bear’ to weather the storm.  Continue reading

Investment in Russia & CIS – Cass Business School and Kingston University

Last week, I visited two highly regarded universities to speak to students about investment in Russia & CIS, and the state of the private equity industry in those markets.  Continue Reading

Investment indicators: looking under the hood

When looking for suitable opportunities, smart investors of course study the minutiae. And this means paying close attention to specific industries, companies and even individual innovations rather than just glancing at the – often misleading – big-picture statistics of national economies. This is not to say that headline figures are wholly irrelevant, but as I’ve already discussed at some length here macroeconomic indicators like GDP have their limits when it comes to serving as accurate measures for growth. In this post I outline a few examples where regional innovation hotspots are as likely to reveal attractive investment conditions as published GDP figures.  Continue reading

Russian property investments on the up

Buried in recent news articles regarding Russian gas supply was a Vedomosti article reporting that in the third quarter of this year investors spent almost $1.8 billion on commercial properties in Russia. Industry data, supplied by international property consultants Colliers International, showed that performance in Russia was strengthening. The figure was significantly higher than investments recorded in the sector in the first six months of this year ($1.3 billion).  continue reading

Evolution of PE in Russia

“Заграница нам поможет!”

О. Бендер (И.Ильф, Е. Петров “Двенадцать стульев”)

“The foreigners will help us!”

Ostap Bender, a character in the famous Soviet novel The Twelve Chairs

by Ilya Ilf and Evgeniy Petrov

The Financial Times published two articles in recent weeks about the PE market in Russia. One discussed at length the current struggles of the Russian Direct Investment Fund (RDIF), whilst another noted US firm Blackstone’s withdrawal from Russia. Both painted a rather negative picture.

Those General Partners that currently operate in the country, myself included, admit that the next couple of years will be tough for Russia’s investment climate (see Moscow Times, “Private Equity Funds Predict Years of Hardship in Russia”). Yet the 6^th Annual Private Equity Conference in Moscow last month demonstrated that the withdrawal of the international community has provided a unique opportunity for Russians to take the driving seat in navigating the local PE industry through the challenges it faces.  continue reading

Google: Jack of All Trades?

Earlier this week there were reports that Google is expected to establish an asset management branch. The FT writes how this development – which is said to have been on the table for a couple of years – has sparked concern across the financial services industry, especially amongst smaller funds, as Google could swamp the market.  continue reading

FOR SALE: Russian Debt

The Russian Government’s bond auction last week was an important indicator of the state of the country’s economy. After months of geopolitical unrest upsetting the markets, it showed that attitudes towards the industry are calming, yields are stabilising and the Rouble is picking up. continue reading