Hermitage CEO Browder: Don't Invest in Russia Today

Transcript

BILL B.: One thing I can tell you is that the story I'm gonna tell today is a kind of story you're not gonna hear from any other speaker coming to this room at any other point. Will the me start out by telling you a little bit about myself. I was here at Stanford 20 years ago. I'm actually back for my 20-year reunion which is what brought me here t... Read More

Summary

In this video, Bill B. shares his unique journey from rebelling against his family's Communist beliefs to becoming a successful investor in Russia. He explains how he discovered investment opportunities in the privatization of Russian companies and how he built his own fund, Hermitage Capital Management. However, he also encountered challenges and corruption in the Russian market, leading to his ban from the country and a subsequent raid on his company's offices.

Questions & Answers

Q: What is the background of Bill B.?

Bill B. comes from a family with Communist beliefs, but he rebelled against his family by becoming a businessman. He attended Stanford Business School and eventually became an investor in Russia.

Q: How did Bill B. get involved in investing in Russia?

Bill B. saw an opportunity in the privatization of Russian companies after the Berlin Wall came down in 1989. He was interested in doing business in Eastern Europe, even though many people discouraged him from it.

Q: What led Bill B. to establish his own fund?

After working in investment banking at Salomon Brothers, Bill B. decided to start his own fund, Hermitage Capital Management, to focus on investing in Russia. He had a unique perspective and believed he could take advantage of the undervalued assets in the country.

Q: How did Bill B. uncover the corruption and stealing happening in Russian companies?

Bill B. and his team conducted interviews with various people who knew about the corruption in these companies. They were able to cross-reference the information they gathered with data from Russian ministries, which helped them uncover the extent of the stealing.

Q: What actions did Bill B. take to expose the corruption in Gazprom and other companies?

Bill B. shared the information they discovered about the stealing in Gazprom with the world. They broke the information into chapters and provided it to major media outlets, which created a significant uproar and resulted in changes within the company.

Q: What challenges did Bill B. face in Russia?

Bill B. faced resistance and backlash from powerful individuals and groups in Russia who were unhappy with his efforts to expose corruption. He was banned from reentering the country and his company's offices were raided by Russian authorities.

Q: How did Bill B.'s journey in Russia end?

Bill B.'s journey in Russia ended with him being banned from the country and his fund, Hermitage Capital Management, facing significant challenges. However, the lasting impact of his efforts to expose corruption in companies like Gazprom caused changes to be implemented.

Q: What lessons can be learned from Bill B.'s experience in Russia?

Bill B.'s experience highlights the risks and challenges of doing business in a corrupt environment. It also emphasizes the importance of standing up against corruption and fighting for what is right, even in the face of adversity.

Q: How did Bill B.'s actions impact the Russian market?

Bill B.'s actions helped shed light on the corruption and stealing happening in Russian companies. This led to changes and reforms within some of these companies, and it brought attention to the need for greater transparency and accountability in the Russian market.

Q: What were the successes and failures of Bill B.'s investment journey in Russia?

Bill B. experienced both successes and failures in his investment journey in Russia. He achieved significant returns on his investments, but he also faced challenges and ultimately had to leave the country due to the backlash against his efforts.

Q: What is the takeaway from Bill B.'s story?

Bill B.'s story serves as a reminder of the risks and complexities of investing in countries with high levels of corruption. It also highlights the importance of standing up against injustice and fighting for transparency and accountability, even when facing significant challenges.