Origin: Novosibirsk, Russia
Based in: Moscow, Russia
Education: Academy of State Services, Novosibirsk, Moscow State University & Harvard Business School
Occupation: Chairman of the Board of Russian Trade and Economic Development Council
Public Ombudsman for Foreign Trade in Moscow
Board Member of Russia’s Digital Economy Development Fund
General Partner of Investment Fund MAXCAPITAL
EARLY YEARS AND EDUCATION
Maxim grew up in the harsh conditions of Novosibirsk, Siberia, where he remembers trudging to school in -40c. This extreme weather taught him to stay calm and not to rush in stressful situations. Maxim first studied at the Academy of State Services in Novosibirsk, he then moved on to do a PhD in Economics at Moscow State University before completing his education at Harvard Business School. During his time at Harvard, he read the book “Discover your true north” by Bill George. While reading this book Maxim decided that his calling in life was international business relations.
When he returned to Russia he was appointed as an advisor to the minister of regional development. In this position, he was responsible for the international relations of the Russian regions with bordering nations. After the ministry was shut down in 2014 Maxim, together with a team of business representatives and the same team who worked with him at the ministry realised that there was a gap and an opportunity to start a trade promotion organisation. They named it the Russian Trade and Economic Development Council and gained support from many different state ministries. Today the Russian Trade and Economic Development Council is working on 25 international markets to support Russian companies expand abroad as well as helping international businesses move into the Russian market. Maxim became interested in the digital projects started by Russian companies and co-invests in them from his subsidiary company Digital Economy Development Fund. Maxim is on the board of the Ministry of Economic Development and the Commission on International Relations and International Trade. He also established the investment fund MAXCAPITAL. This investment fund focuses on venture capital, real estate, and private equity.
CHALLENGES AND INSPIRATIONS
Maxim states that his biggest challenge in his working life is to concentrate: “To concentrate meaning not to jump from question to question, but to delegate it accurately and keep your attention on the most important issues. The question always is – what is the most important task today? And if you answer this correctly to yourself then you can cope with all the questions and issues.”
Maxim has felt inspired the most by the Harvard alumni support: “I didn’t really think that Harvard Business School would influence my life after graduation… but a couple of years after graduation I was invited to the Alumni meeting. I found that the Harvard community is supportive of all issues. You can write to anyone, ask for advice, ask for support, and ask for a recommendation and a proper contact. And [the response] is not ‘why do I need to help you?’ – instead it is truly supportive with the wish to understand what you need and that’s important for me because the Harvard business community is found in every country. It’s very important to have someone truly reliable and trustworthy for recommendations, these sorts of recommendations are needed for global business development.”
ON DOING BUSINESS IN RUSSIA
TT: What do you say to a Western investor? Why should they be doing business in Russia?
“I would say that currently Russia is the most underestimated country. I talked to some of my business friends recently and they said that the salary in Russia is now so low that if you involve Russian employees in international projects, it would be very beneficial and of course the level of education and the qualifications of people is also very high. On the other hand – for example in venture capital, due to the lack of foreign capital and foreign investors – if you decide to, you can find very good deals in Russia; and these deals can give you a level of return on investment which is difficult to reach in other countries. Russia is really an underestimated market and if you want to try investing here you simply need to find good partners.
“Currently Russia is quite a big market – it’s the 10th largest market in the world. And of course, when we talk about Russia we talk not only about Russia, but also about the CIS. Because all CIS countries are closer to Russia than other countries. So, from Russia and Moscow you can develop business in Kazakhstan, Belarus, Azerbaijan, Kyrgyzstan etc.”
TT: What are the biggest areas of opportunity for foreign investment currently in Russia?
“Venture capital (VC) is an opportunity where you can find projects which can be good in terms of usability and can be easily relocated/moved to other global markets. If you find projects like these, and they are quite sustainable in Russia – they can grow in other countries as well. VC is growing quite rapidly in Russia.
“The next sector is real estate, which is still underestimated due to the current rate. If you look at the historical price of real estate, for example in Moscow, it was almost twice as low as it currently is, so it will recover, and it will become twice as expensive. The real estate sector in Russia has been recovering over the last year.
“Also export-oriented companies – as far as we are working with export-oriented companies, we will see that finding a proper company is a good spot for investment.”
TT: What are the most common challenges foreign investors face in Russia today? How can the Russian Trade and Economic Development Council assist?
“The most common challenge is analysing the market because the proper analysis of the market would help avoid mistakes. Of course, we have an analytical department and team who can research deeply into the details of competitors; we know all import, export, and domestic competitors. If there is a niche for your business, then it’s better to determine exactly that niche. Then secondly find a proper partner. At the Russian Trade and Economic Development Council we can also be a partner or can help to start your business properly. Why is this important? Because when you start a business, you don’t only need to do the proper old traditional things – that’s important for sure; but you also need to find a proper team to start the business. You need to either penetrate retail or B2B sales and for that, you need to hire proper management. And to do that you need a local approach together with what you are used to in your current business.”
TT: You are very active in Russia’s digital transformation scene – how would you describe the current status of this transformation process and what more needs to be done?
“That’s a very interesting question because the digital transformation process has been rapidly developing in Russia for the past 2-3 years. That’s why we founded our company, Digital Economy Development Fund, which concentrates on both the digital strategy for corporations and empowering digital projects to grow into corporations or into global business development. You can see this transformation everywhere. I would say Russia has really found some interesting niches and opportunities for start-ups, which you cannot find in many other countries. For example, in downtown Moscow, you can do everything remotely. You can find food remotely, you can buy from any shop remotely – it doesn’t cost you a penny, sometimes it’s even cheaper, this can all be done with just access to the Internet. This is taking place in other parts of the world too, but you can also see how businesses are oriented to transform digitally because many are struggling to be more efficient. If you have a digital feature, project or service which can be used to empower businesses with new technologies, it will be tried and tested, made into a pilot, and afterwards implemented.”
TT: Imagine Russia in 5 years, what do you hope will be different about your country and/or the way it is perceived internationally compared to now?
“Well, I hope all political issues will be solved because we don’t deal with politics in the Russian Trade and Economic Development Council. We simply concentrate on business because talking about politics is too difficult for the world. I hope that more and more international companies will see the opportunities in Russia. We are a vast territory and a very intellectual and well-educated population. And I hope that the country will benefit from it in terms of life quality. Although life quality in our cities is much better than in most European ones because of the good state management system. So, I would like to invite all investors to come and see Moscow, it will contradict any bad information you heard about it before, you will only have positive experiences here. And we at the Russian Trade and Economic Development Council are ready to support your way into Russia.”
Quote: “Do what you really love and find what you really want to do and feel it. If you really feel it and if you really want to do it, it doesn’t matter who judges you or who says you can or can’t do it, you will succeed.”