Subject The article reviews the system of financing innovation through venture capital in Russia, its specifics and development problems. Objectives We focus on presenting the financing of innovation by venture capital as an integrated system, searching for solutions to problems that encumber the development of innovation activity in Russia on the basis of the analysis of operations of all its participants. Methods We employ general scientific methods of comparison, analysis, synthesis, deduction, graphical and tabular visualization of data. Results The paper systematizes the knowledge of the said system functioning, analyzes the current situation in Russia on the basis of market research data of the Russian Venture Company and the Russian Venture Investment Association for 2017, offers measures to ensure a stable development of innovation in the country and stir up the activities of the system participants. The obtained results can help policy makers to design government programs for innovation promotion, and participants of venture capital financing to make their decisions. Conclusions Nowadays, venture capital financing is one of the most effective tools to stimulate innovation in the country and the State should pay due attention to it, correctly regulate the interaction of its elements, develop and maintain the infrastructure of the venture capital market, and further apply direct and indirect methods to boost venture capital investment and venture companies. This will enhance the country's capacity to innovate, the competitiveness of domestic goods in the global market.
Keywords: venture capital funding, innovative activity, investment
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