The Autumn 2010 panel discussion “What’s the Secret of Silicon Valley and How Can It Be Replicated in Russia”, hosted by the American Business Association of Russian Professionals (AmBAR) and CREEES, featured a prominent guest speaker: Viktor Vekselberg, the President of the Skolkovo Foundation. Skolkovo was established as a way to promote modernization and entrepreneurship in Russia.

The discussion began with brief outlines from each panelist about the steps Russia must take in order to develop an “ecosystem” for innovation. The panelists, who included high-level representatives from Siguler Guff, Delovaya Russia, Ernst & Young, as well as other Silicon Valley businesses, agreed that a willingness to take risks was one of the major parts of the Silicon Valley ecosystem. Developing a sense of courage and experimentation is key: “Don’t worry about failure,” said Nimesh Gupta, Co-Founder of Nexus Venture Partners.  A transparent business infrastructure, strong commercial codes, and venture capital were all discussed as necessary measures to create the proper ecosystem at Skolkovo.

Vekselberg said, however, that the Skolkovo project simply has not yet reached a level that requires venture capital.  The project is just starting out, he said, and there is currently nothing to show.  The idea behind Skolkovo is first to create the mindset—rather than the infrastructure—necessary for entrepreneurial innovation. “We are not creating a business, but an environment,” he said. Vekselberg believes that once the mindset is in place, further modernization will soon follow.

In Russia’s old system, he explained, Russia was pushing out the intellectuals—many immigrated to America to realize their dreams because there were so few opportunities to pursue their interests in Russia.  The intellectuals who remained in Russia faced many difficulties. Though Vekselberg graduated at the top of his class and was first on the job list, he was rejected for four positions because his last name is not Russian.  “Fortunately, the young [in Russia] do not remember the old system that I had to live through,” he said. 

Currently, Russia has high quality universities and talented people, but very little environment for entrepreneurial innovation.  At Skolkovo, Vekselberg believes that Russia can create such a place for people to mine their talents. He said that the necessary steps include building an institution similar to Massachusetts Institute for Technology (MIT) and outfitting this institution with professors, labs, and other successful members of the technology community. First and foremost, the project aims to attract high-profile businesses and people who will bring their ideas and innovations.

So what is the Skolkovo Foundation?  It is not a government organization, Vekselberg emphasized. Skolkovo is actually non-profit organization, founded by five organizations that hold state capital.  Its founders have taken steps to limit government interaction and participation with the project. Skolkovo will not be competitive with Silicon Valley for a very long time, Vekselberg said. Ultimately, he hopes that the project will allow Russians to play a very important role in the entrepreneurial community.