Small and medium-sized businesses create a great many jobs worldwide, facilitating economic diversification and increasing resistance to economic shocks. In the Russian economy, they account for 21% of GDP. While this represents an increase, their potential is undoubtedly greater still. The appearance of new enterprises is associated in many respects with economic modernization and greater efficiency. Small and medium-sized companies are more rapidly able to react to the demands of the market, create niche products, and adapt to ever-shortening product lifecycles. So what is preventing this potential from being realized? Why isnt entrepreneurship as popular in Russia as it should be, with only 5% of the population describing themselves as prepared to open a business within the next three years? Entrepreneurs complain about excessive red tape, especially unscheduled inspections, difficulty accessing loans, and a lack of infrastructure needed to develop. However, equally serious obstacles to development are a lack of entrepreneurial skills and a shortage of qualified workers. How can special educational programmes for business be created and made accessible to all? Small companies need to gain access to regional, national, and global knowledge bases, and to create systems for managing the implementation and integration of this knowledge. The Russian government has developed a long-term strategy for developing entrepreneurship and is currently implementing it with success. But is it enough? Can we expect a technological breakthrough and a growth in technological exports from this sector? How do entrepreneurs rate the efforts of the government and development institutions?