What is Special about Moscow’s Startup Ecosystem?
Unique quality of human capital and synergy between tech and creative industries
In recent years, Moscow has become a gravity center for the most talented people not only from Russia and Eastern Europe, but from all over the world. Such concentration of professionals credits Moscow as one of the global “cities of the future”, a world center for the development of breakthrough technologies, particularly in IT. Global giants such as Huawei, Intel, and Microsoft have already opened their R&D centers in Moscow. In total, 44 R&D centers of the international companies included in 500 Forbes, Fortune 500 and 1000 Innovation are actively operating in the city. Moscow still has a huge unexplored potential as a unique location for R&D in AI and big data.
Moscow has a huge scientific and human resource potential. In comparison to other megacities, Moscow prides itself with one of the highest levels of training researchers and tech experts. This can mainly be attributed to a strong mathematical school and the traditions of the educational system, which provides extensive STEM knowledge. More than 326,000 researchers work in 800 scientific organizations, and more than 200,000 students prepare for their technical careers in Moscow universities.
Moscow has the best level of developer training in the world. For the entire duration of the Google Code Jam and Facebook Hacker Cup, Moscow participants in the national team collected the most medals. For the past 2 years, students from the Moscow State University have won the International Student Programming Contest. Students from Russia have been winning the International Student Programming Contest for 6 consecutive years, with the main rivalry in the international competition being between Moscow and St. Petersburg.
Moscow is the leading center of European creative industries. It is the world leader in the number of museums with more than 450 sites. Every year Moscow hosts thousands of events: festivals, exhibitions, concerts. Some notable events are the Moscow International Film Festival and the Circle of Light Festival. In Moscow, creative industries are getting ever more interwoven with the high tech sector, which produces a strong synergy effect for the birth of new ideas.
High level of tech optimism and readiness for innovations
99% of Muscovites use digital platforms and services (71% daily). Success in introducing electronic services is noted not only by Muscovites, but also by international expert organizations. For example, Moscow immediately took 1st place in the United Nations 2018 E-Government Survey.
Muscovites warmly welcome innovations. The general level of “technological optimism” in Russia, reflecting the faith of citizens in scientific progress, is quite high. Thus, 42% of Russians agree with the statement “Scientific and technological achievements can solve any problems” compared to only 22% of the survey participants in the EU. This level of tech optimism along with Moscow’s local Government efforts to remove the legal barriers for the development and introduction of innovations, is what makes Moscow a city cut out for piloting innovative products and solutions.
A vibrant and highly integrated innovation ecosystem
Every year, hundreds of events for startups take place in Moscow, including prominent ones such as the Open Innovations Forum and Startup Village. The central hub for the Moscow startup community is the Digital Business Hub – a venue run by the Moscow Agency of Innovations. The events held here include innovation and technology forums, events for young and experienced entrepreneurs, venture capitalists and potential customers of innovative solutions.
Extensive innovation infrastructure
Entrepreneurs have access to more than 2 000 objects of innovation infrastructure. This includes 36 technology parks focused on mechanical engineering, IT, aircraft industry, electronic engineering, pharmaceuticals, construction materials, biotechnology, nanotechnology, light industry, and power engineering. Residents of technology parks receive a number of benefits: subsidies for equipment and construction and property tax exemption. They also pay only 0.7% of assessed land tax, and pay a land rate of only 0.01% of its cadastral value.
Public Sector Incentives
The Moscow Innovation Cluster - is a platform for introducing innovations and developing cooperation between startups, SMEs, large corporations, industry, educational and scientific organizations, development institutions and the city. The cluster IT platform (https://i.moscow) unites the entire innovation ecosystem of Moscow and provides unique opportunities for interaction between its actors. The platform provides companies with tools to build cooperation chains and to create projects that can gain direct access to all government support measures. Their resources extend to tools for promoting their products and services, tools for authorities, development institutions and state corporations, opportunities for concluding deals by means of a smart contract system through highly reliable blockchain technologies and much more.
The Moscow Accelerator Program - The goal of the program is to help Moscow, international startups and SMEs – developers of innovative technological solutions (with MVP or ready product) – to scale up their businesses and make their solutions more marketable. Each of the accelerator tracks is organized by the city of Moscow in cooperation with one of the leading Moscow corporations. During the 10-week sessions, participants work on real cases provided by Moscow corporations and the City of Moscow, test their hypotheses, receive constant feedback from experts, and exchange experience with other IT entrepreneurs. The program includes practical workshops and master classes, expert sessions and personal consultations.
The Moscow Innovation Pilot Program - Moscow Innovation Pilot Program is a service that enables companies from all over the world to test their innovative smart city solutions in Moscow. The service helps innovators confirm the economic and technological efficiency of their solutions and contributes to a greater adoption of innovations among public and private customers. The program helps companies multiply the potential of their projects, working in partnership with the city or a corporation, as well as provides them with the unique possibility of networking with the key players of the Moscow innovation ecosystem, valuable experience of the Russian market and a chance to pilot their solutions in the city of Moscow. The city offers piloting sites for projects in the following spheres: retail and services; environmental management; energy efficiency; security; ICT; transportation; medicine; education.
The Moscow Seed Fund provides various kinds of loans to innovative startups (up to USD 530.000). Innovative projects at the seed and pre-seed stages and companies preparing for IPO can be offered preferential investment loans (financial support from private investors).
The Moscow Small Business Lending Facilitation Fund provides loan guarantees; securities for bank guarantees, as well as securities for leasing, factoring and letters of credit in amount to up to 70% of the collateral required by the creditor (up to USD 1,500,000).
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