Russian Venture Company Fund of venture funds Basic terms Ministry of Economic Development and Trade Russian Federation

Russian Venture Company How it operates Russian Venture Company Privately Managed Venture Funds Venture fund VC FUND OF FUNDS LEVEL VENTURE FUNDS LEVEL STARTUP LEVEL    Å   Nanotechnologies Alternative energy Medical technologies BiotechnologiesTelecommunications Information technologies  Microelectronics Venture fund VC Venture fund VC Venture fund VC Venture fund VC Venture fund VC

Russian Venture Company Basic structure Investment Fund of Russia JSC Russian Venture Company Venture funds (closed-end mutual funds *) Fund Management companies RUB 15 billion 100% RUB billion 51% Venture Capitalists †    manage Carried interest (20% max) Management fee (2,5% max) 10 or more venture funds Investments Early stage innovative startups manage Private VC fund limited partners RUB billion 49% Buyout price: Original RVC money + 3-5% annual interest Buyout right for RVC fund units (5-year vesting option)   * tax transparent, licensed management company required, some regulatory requirements apply; in process of deregulation for qualified sophisticated investors similar to U.S. Reg D Return on investment (~80%) Buyout price: Original RVC money + 3-5% annual interest Buyout right for RVC fund units † employees of the management company charged with managing the fund; must contribute at least 1% of capital to the fund as physical persons RUB 27 ~ US $ 1 RUB 15 billion ~ US $ 550 million RUB 0.6 billion ~ US $ 22 million RUB 1.5 billion ~ US $ 55 million

Russian Venture Company Decision process Board of directors State directors (public officials)    Venture directors (external professionals)  General director  Official decisionmaker Organizes competitions Signs checks Interfaces with bureaucracy RVC Staff (5-6 people)    Criteria External director = Venture fund executive experience or experience in venture promotion policies (national or international) Funding decisions = independent directors can jointly veto the government choice All figures and terms are provisional and subject to further change

Russian Venture Company Independent Director Rights and Duties Rights Directors together can veto any investment decision as inappropriate based solely on their judgment Duties Directors have to attend board sessions in person once a quarter to review the venture team presentations Directors receive monetary compensation and have all their trip related expenses fully paid Directors enter into a contract with Russian federal agency to act as directors, agreement is construed under Russian law Expected time commitment – about 1-2 days and 5 to 15 presentations (Normally end of quarter, weekends are possible) Directors must review all proposals for funding; any associates help might be enlisted but director must make a personal decision Directors can meet the venture capitalist teams, ask questions and make inquiries Directors do not have to participate in daily matters of the company; they will be asked to take part only in investment decisions

Russian Venture Company Leverage Government will cap its return from VC funds at 3% per annum! RVC share 49%, IRR to RVC 3% Management fee and carried interest are not factored in Extra IRR For 5, 7 and 10 years of fund life RVC funds will be refundable but at a very low effective interest rate (starting from 3%) If a fund is successful, limited partners can buy out the government's share in the fund at a 3% effective annual yield to the government This way the government will out some of the investment risk Our goal is not to make money but to create Russian hi-tech sector WE GIVE FUND YOU GROW STARTUPS YOU KEEP NEARLY ALL NET INCOME All figures and terms are provisional and subject to further change

Russian Venture Company The Message For limited partners and VCs: Hire the best teams Seek most promising startups We want to work with you For mass media: Tell everyone who dreams of building a new Google или Intel, but does not dare – Start founding startups now unless you want to be late for money. It's time. Money for new success stories is on the way.