By Andrei Skvarsky.
Yevgeny Kogan, president of the Moscow Partners investment boutique and a former senior partner at Russian wealth management firm Third Rome, talks to EmergingMarkets.me about his company’s history, current business and plans.
Yevgeny, what is your role in the company, which you and Igor Moryakov have founded as partners?
It may be worth starting with a few words about the company itself. Moscow Partners specialises in mediation between rapidly growing middle and small capitalisation companies, on the one hand, and institutional and private investors, on the other. We help our clients to raise funds they need for further development and give investors an opportunity to obtain high returns from their investments in such companies at early stages. Igor Moryakov is chairman of the board of directors at Moscow Partners and Irina Morozova is general director. I am president of the investment group. My personal role is to evolve a development strategy, work with major clients and seek mandates. Public relations, promotion of the Moscow Partners brand and business development are also part of my duties.
You joined Moscow Partners quite recently, on July 1. Before that you were a senior partner at Third Rome. What was the reason for the career switch ?
A desire for independence and the experience I had accumulated. I wanted to launch a project that would be completely in line my interests and give me an opportunity to use my potential. This led to a decision to develop a business with partners who shared my ideas. I’m sure we will succeed.
I like Third Rome very much. They are an excellent team, and I’m very pleased to have worked there. By the way, I have always said and will be saying that Andrei Movchan has been able to put together a wonderful team at Third Rome. In all sincerity, I wish them success.
As for my reason for going over to Moscow Partners, it is perfectly explicable. There are some specialised fields of work that I’m interested in. I want to pursue a specific line of business, namely to develop mechanisms of capitalisation and get companies ready for IPOs and SPOs.
How would you best describe Moscow Partners’ business model?
You know, my colleagues and I are somehow happier to describe ourselves as an investment boutique. We want to do something for which there’s interest in the market. Namely, we manage our clients’ assets, and we do all that is needed to capitalise the company and to create its stock exchange history.
Moscow Partners was set up quite a long time ago. Why is it only today that the company has begun to be talked about so much? Does it mean rebranding or second wind or something else?
Yes, a company with this name did exist back in the early 90s. They were, by the way, one of the pioneers of the Russian stock market. Moscow Partners was a member of the 15-company PAUFOR association of brokers [Professional Association of Stock Market Participants], which formed the basis for the RTS stock exchange. Later Moscow Partners merged with another company. It’s a brand that only stock market veterans can remember. So in effect, we are talking about the restoration of the name, brand and core idea of Moscow Partners.
Does Moscow Partners have any deals in the pipeline?
Certainly. We are working today on a considerable number of mandates for very interesting plans for IPOs and SPOs, and so on.
How much money has Moscow raised or is planning to raise for investment?
I can only say that we have very ambitious plans.
Where does Moscow Partners draw its financial support from?
Moscow Partners are a dynamic team of like-minded people. Many members of our staff are quite well-known people in our industry. I would even say they have brand-like names. For this reason we are well-known and trusted, and there is willingness for cooperation and partnership with us.
Is Moscow Partners planning any hires, and if it is, how many people, and for what jobs?
As I said, we are a boutique, which by definition doesn’t imply an extensive structure. In our view, effectiveness is not at all dependent on the size of staff. We don’t have any plans to staff the office with 50 or 100 people. Most likely, the number will never be more than 25 or 30. People who were our colleagues in the past are willing to join the Moscow Partners team. We definitely value this a great deal, and we value each person as well.
What is your forecast for the future of fund management and the savings culture in Russia?
My opinion is that the situation in the stock market directly depends on the business climate, and both the investor community and the state play important roles there. I primarily mean pension funds. In my view, the main present-day problem of the stock market in our country is the absence of what one could call a pair of “long-term reliable hands”. If there were enough players of this kind, the market would be more stable.
One more very important point is that today the total number of brokerage accounts in Russia is no larger than 1% of the country’s population. For comparison’s sake, in the United States, which is the global benchmark, more than half the population invest in the stock market directly or indirectly. Eastern European countries, Poland for example, also have much larger proportions than Russia.
Another fact that needs to be pointed out is the inadequate culture of savings in our country. But, apparently, the main problem is there is not enough information and education. Solving this problem would make it possible to change the situation for the better.
I believe that carrying through all the aspects of change I’ve spoken about would enable us to speak of a normal stock market in Russia.
Yevgeny Kogan was chief executive of Russian company Antanta Capital and a senior investment adviser to the Union Bank of Israel before joining Third Rome. He won the 2007 Financier of the Year title from RIA Novosti and RBC and has received a Chivas 18 Top Financials award as a stock market guru.
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