Basic materials have been the driving force behind the growth in Russian high net worth individuals (HNWIs), but research by WealthInsight has found that the technology sector has been booming in recent years. Wealth managers should pay attention to this fast-growing sector.
Since 2007 the number of ultra-wealthy Russians (those with net assets of US$30 million or more excluding their primary residences) who acquired their wealth through technology has grown by 21% – more than any other major sector. Research by WealthInsight finds that, at the end of 2011, the technology sector is the primary source of wealth for 5.7% of Russia’s ultras.
At present, compared with the other ‘BRICS’, only Brazil is behind Russia in its ratio of ultra-HNWIs coming from the technology sector.
But the Russian technology sector is a growing market: in 2011, Russia overtook Germany as the European market with the highest number of unique visitors online and internet penetration rates, relatively low compared to developed markets, are expected to increase from 40% to 70% over the next four years. As the internet market continues to develop, this will create opportunities for companies with an understanding of local markets and political nuances, leading to an upsurge in the numbers of HNWIs coming from this sector.
For more information see WealthInsight’s report on Russia, “Russia – The Future of HNWIs to 2016: The Land of Oil and Gas”.