KAMA FLOW at CIPR-2025: Why the Placement Market Outpaces Venture Capital?

Evgeny Borisov, Partner at KAMA FLOW, took part in CIPR-2025 and spoke at business program sessions focused on venture capital: "Venture Investments: Clinical Death or Deep Transformation?" and "Building the IPO Elevator – Challenge Accepted!"

During the first session, participants discussed the current state of the venture market and its short- to medium-term outlook. In the second session, where Evgeny acted as moderator, the speakers addressed the development of the pre-IPO market and mechanisms for companies to go public. He shared insights from KAMA FLOW's recent study, "Collective Investments in Russia: Growth, Risks, and Prospects", highlighting a paradoxical situation in Russia — an inverted "investment pyramid":

“In mature markets — whether in China, the U.S., or Europe — the volume of venture capital and private equity is 10–20 times greater than the IPO market. That’s logical: the investment funnel works, and some companies eventually make it to the stock exchange.

Here, it’s the other way around. If you look at the placement market over the past couple of years, it exceeds the volume of the entire pre-IPO and early-stage segments by a factor of 10. So, more capital reaches the exchange than passes through the preliminary phases. This disrupts the funnel logic and the development of the ecosystem itself.”

Evgeny also emphasized the high volatility in the market, as reflected in wide valuation swings and the difficulty of closing funding rounds — particularly at the end of 2024 and the beginning of 2025. Many deals were challenging, with both valuations and average check sizes declining. As of now, according to KAMA FLOW’s analytics, the average pre-IPO deal size in Russia remains objectively small — around 227 million rubles.

Despite these challenges, the panelists expressed confidence in the Russian market’s substantial potential for recovery and growth: new financing tools are emerging, interest from institutional and private investors is growing, and tech companies are increasingly moving toward maturity and scaling trajectories.

According to Alexander Gentsis, Member of the Board of Directors at Diasoft, companies must prepare thoroughly and systematically for an IPO:

“It’s important to understand that an IPO is not the final goal, but a stage of development. It’s a serious boost for a company’s market positioning and supports its growth strategy. To be IPO-ready, you need a team motivated for this path, education, systematic work with information, and strong bankers to get you on that stage. That journey starts long before the actual placement.”