Ben Aris in Moscow -

Patricia Cloherty has been running funds since most of us were in nappies. Ranked 63rd in Forbes magazine's Midas List of fund managers last year, she is a doyenne of the Russian capital markets, moving from funding the project that created Dolly the cloned sheep, to being asked by former president Bill Clinton to run The US Russia Investment Fund, which was supposed to help transform Russia into a capitalist country.

Cloherty, chairman and CEO of Delta Private Equity Partners, which manages the two venture capital funds The US Russia Investment Fund and Delta Russia Fund, bubbles with enthusiasm when discussing the relationship between successful entrepreneurs and people who have both excelled at sport and hard science.

Cloherty began her first private equity career in 1969 with US venture capital firm Patricof & Co. Ventures, later to become Apax Partners. Her first fund started life with just $2m under management and had grown into one of most successful technology and biotech investors with over $10bn under management by the time she left.

Ranked as one of the 100 most influential women in the US venture capital world, in 1994 Clinton asked Cloherty to accompany him for a summit meeting with the late president Boris Yeltsin in Moscow. "I was sitting in my offices on 57th and Park Avenue in New York when I got a call from the White House. 'We need a 'deliverable' on the fund issue for Clinton's trip to Russia,' they told me, and asked if I would go over with Clinton and head up the fund," says Cloherty, who was then president of the US Venture Capital Association.

In true fund manager style, as soon as she had landed in Russia she hired a helicopter and few off to visit a couple of factories to see what life on the ground was like. Her stop was Sun Brewery, run by the Indian Shiv Khemka and one of Russia's first really successful foreign investments. Then she went on to a chipboard plant on the Finnish border. "They made fibre board the old way by hand," says Cloherty sitting in the swanky café in the foyer of her office, a stone's throw from the newly renovated Bolshoi Theatre. "Babushki were testing the finished boards by hitting them with a hammer and listening to see if there were any holes in the boards. The whole place stank."

Rather than being put off, Cloherty, who like Mark Zuckerberg of Facebook, speaks ancient Greek, says the whole experience "only energised" her. "After the trip to Moscow, the State Department rang again and said things weren't gelling and would I go back. I left the next day, I didn't want to give myself the time to change my mind," she says.

Clinton appointed her head of The US Russian Investment Fund and by 2004 she had set up Delta Private Equity Partners, the private equity firm dedicated to developing and funding fast growing companies in Russia. Since it was founded, it has invested over $500m in 55 Russian companies through two funds: the US Russia Investment Fund established in 1994 and Delta Russia Fund, a successor private fund formed in 2004. The Delta Russia Fund is winding down now and has sold all but four of its investments and earned an impressive 27% return on equity during the process, scoring some major firsts along the way.

Safe as houses

Probably Cloherty's most lasting legacy will be the creation of Delta Capital, Russia's first dedicated mortgage bank, which was sold to GE Capital in 2004 at 4-times book value. At the time, it was hailed as a spectacular deal, as most banks in Central Europe had been sold in the 1990s at 1.0-1.5-times book value.

Today, the mortgage business is still in its infancy with a total of about 150,000 mortgage contracts outstanding in a population of 142m. However, the number of new contracts being issued has been doubling every 18 months or so and the Russian government expects the total volume to triple in five years. "The thing that really struck me about the mortgage business is Russians are honourable borrowers - if they take a loan, they move heaven and earth to repay it. Owning their own place is important to Russians and they don't want to lose it by defaulting on their loans," says Cloherty.

Another of her legacies was to train a whole generation of young Russian financial professionals. "The first thing I did on taking over Delta was sack all the expats," says Cloherty, who very unusually for a Californian smokes incessantly. "They were either bent or incompetent. We hired [in their place] Russians, Ukrainians, Belarusians and Georgians."

Kirill Dmitriev, the young manager who was appointed this summer by Prime Minister Vladimir Putin to run the Kremlin's $10bn Russia Direct Investment Fund, is probably the most famous alumnus of the Cloherty school of asset management. But she has also been a pioneer in several other sectors: investing into the first successful supermarket chain, a bottled water company, a packaging company, to name but a few. But not all the deals went smoothly - one of Cloherty's very first deals was into a diesel engine plant, but the money almost immediately disappeared. "I tracked the money to a suitcase that was delivered to Vienna, but lost the trail there. We found the partner, but not the money," says Cloherty.

And the Russians have lauded Cloherty. Until recently, she sat on the Russian foreign investment council and the board of Skolkovo, President Dmitry Medvedev's pet project to create a Silicon Valley in Moscow. And she is deeply enmeshed in the rhythms of Moscow life. Currently, she shares her apartment with 17-year-old Joy, the granddaughter of the founder of Scientific America magazine (another of Cloherty's successful investments), who is one of the few Americans studying ballet at the Bolshoi. "It's a little bizarre, as I keep having all these young Russian and French ballerinas ringing up in the middle of the night," says the irrepressible Cloherty, who is still a dynamo of energy despite her 70 years. As I came into her office she was chortling with laughter, sporting a "Silver Sharks" ice hockey shirt, the name of the local youth team she has sponsored and sent to Canada in November to compete in the world youth games (they won, of course.)

Cloherty obviously has a passion for Russia, but she has not been able to make venture capital investments into biotechnology, which is where she made her name in the US. Most famously, she backed the Scottish project to clone sheep that could produce a special protein far more cheaply than synthesis - mainly because it made good business sense, but also because her sister was suffering from a disease that the protein would cure. The project worked, but unfortunately not in time to save Cloherty's sister. And in a similar spirit, she was a big investor that eventually produced the cocktail of drugs used today to fight HIV-AIDS. "[Biotechnology venture capital] won't work in Russia, as there is still no enforceable intellectual property laws that protects the heavy capital investment you need in this kind of work," says Cloherty, who comfortably flips constantly between talking about her ballet friends and ice hockey team to discussing hardcore investment into hi-tech medicine without a pause for breath.

But she remains committed to Russia and believes that it is still at the start of the transformation process. Her skill has been to spot the Russians who have a vision and the ability and energy to create something new. "You have to remember everyone in Russia was someone else a decade earlier," says Cloherty. "People learned how to do business from watching movies like 'Wall Street'. That is why recreating things that already exist elsewhere can be so difficult. But then look at the growth rates and that in itself is a testament to the Russian ability to learn."