RUSNANO is a private equity firm focused on the development of the nanotechnology industry in Russia. Using government funds, it invests in nano projects that have significant economic or social potential, across a variety of industries. Having provided capital for a company, RUSNANO works with it for five to seven years to develop the business before it is bought by strategic investors.
The hi-tech nature of these enterprises means that RUSNANO often has to make an investment decision at the R&D phase, before a product is on the market. This introduces a high level of risk, so the company looked to the discipline of risk management, adopting a modern and comprehensive approach through risk modelling.
RUSNANO uses the complete Palisade DecisionTools Suite toolset, with a focus on TopRank and @RISK. The tools help RUSNANO to model projections of different KPIs on two management levels: portfolio management level and investee management level. This allows it to calculate the right value of investment based on the risk it entails and understand the overall liquidity of the portfolio using risk analysis.
Using Palisade’s tools, risk managers at RUSNANO can communicate uncertainty to the company’s senior executives; the key factors, risks and projects that have the most impact on the company and project KPIs. Modelling risks also helps RUSNANO to understand the different micro factors that are outside the control of the investment team. The insight provided is in-depth and indicates when the impact of those factors is potentially a significant threat, therefore requiring risk mitigation action planning and model changing accordingly for the portfolio or the project to be successful.