Ru En

You can fool anyone you want, but you can’t fool yourself

“He’s a man with spring on his soul, which allows him to work, manage, dance, make friends, raise four children and publish books with a wide Caucasian smile.” BOSCOMAGAZINE

Ruben Vardanyan Troika Dialog Moscow School of Management SKOLKOVO Manager

Date: 28 March 2011


“He’s a man with spring on his soul, which allows him to work, manage, dance, make friends, raise four children and publish books with a wide Caucasian smile.” BOSCOMAGAZINE

In their home country, Russian businessmen are scolded rather than loved: “They could learn a thing or two.” What this means, of course, is learning to earn money: do it quicker and easier. Ruben Vardanyan, of course, can tell you how to earn money, forecast risks and valuate deals. But he can tell you even more about how to be a person. Some will tell you that being a person is the simplest thing of all. But go ahead and try. All I can say is that Ruben Vardanyan does it well.

Since the financial crisis, an increasingly popular topic for discussion, including in social settings, has been the importance of trust. Everyone’s talking about how no single system can work without trust. At the same time, however, no one is ready to trust each other. Have you forgotten how to trust people? And is this really that important?

If we’re talking about trust globally, in terms of its influence on society, then I recommend reading Francis Fukuyama’s book “Trust,” which explains that the less trust there is in society, the less chances there are for stable and successful development. In terms of personal relationships, in my opinion, to trust or not to trust is an independent choice for each person, regardless of time and the society in which he or she lives. I think it’s important to trust, even if there aren’t enough rational arguments for doing so. In the early 1990s, when the Soviet Union was breaking up, many people ended up below the poverty line and had no choice but to beg for change outside. As a student in those days, I used to argue with my dormitory mates about what was better: being a fool but trusting and giving change, knowing that nine of ten people asking are thieves, or, on the contrary, being sensible and walking past those who ask.

And what did you argue?

I believed it was better to be a fool 9 times of 10, but to believe and help even just one person who really needs it.

Well, that was a long time ago, when you were young and naïve. Are your views different today?

I’ll answer you with another story. An old and wise person once said to me: “Ruben, a businessman’s success or failure isn’t a question of how much money’s on their account or how big their assets are. A businessman’s success is verified by how much money they can gather in a week without having a single document in their hands.” Simply put, how many people are ready to believe this businessman just because, entrusting him with their money under their word of honor. This is what’s truly important. Everyone should think about this question, and imagine themselves in this situation. Then everyone will realize the value of such ideas as trust, success and reputation.

You can certainly be included in the group of “right” businessmen: your biography lacks any dark periods or omitted facts. However, such an image contradicts the ambiguous Russian reality. How do you interact with those around you?

I’ll be open with you… it’s a very tough question. Of course, I’m not going to call myself an angel and swear that I've always done everything right. A lot of different things have happened in life: I’ve offended people, made mistakes, and broken certain rules… There’s a line that you can’t cross, and there are compromises that will harm you if you make them. I’ve always tried to avoid crossing this line. That’s probably why I still don’t have security…

Let’s be more specific. Have you ever bribed a traffic cop?

You know what’s funny? Sometimes I’m behind the wheel, for example – on weekends. Then I realized not long ago that things are a lot different now. Now, if you break the rules, no one stops you. It was different in the 1990s: you were stopped literally at every step, and they were picky about absolutely everything… But now I buckle up, don't cross the yellow lines and try not to break any rules at all – and no pretensions.

Do you ever have to work with unpleasant people? How do you behave when you find someone unpleasant but business obligates you to work with them?

I’ve always been able to allow myself one luxury: to refuse to work with people with whom I plainly don’t want to work. If you look at our company’s history, you will see, for example, that Troika has never participated in hostile takeovers.

But there’s so much money to make that way…

Of course, we could have, but we didn’t. This is one of my philosophical principles: money determines a lot, but not everything. Clearly, when the country experiences a new stage of development – establishment of market institutions, formation of the financial sector – all of these processes have their costs and at a certain point earning money doesn’t line up with ethical norms. But again there’s a certain line. You can fool anyone you want, but you can’t fool yourself. Sooner or later you have to tell yourself that at some point you made a weak, unworthy decision. Hopefully no one has to reach that point.

Therefore, unlike the majority of businessmen, money isn't the main driver for you? Then what is it?

Money was never an exclusive goal for me. For example, in the 1990s I left behind a salary of one thousand rubles (while my father, a professor, was receiving three hundred) to work at Troika, where for the first half-year I didn’t receive a kopeck. By purely formal criteria, I acted foolishly in the short term, but in the long-term we built the company. I don’t think about money when it comes to charity and educational projects. I’m just deeply convinced that such work has to be done.

Fowles once said that any well educated person should uphold leftist views. It seems to me that in you socialistic streaks you are in fact close to this kind of person. But how do you reconcile this with business?

I think that capitalism is a flawed system. Any society where money is the only measure of success is flawed, because money by no means can measure everything. In our country this problem is exacerbated, since we leaped into capitalism from the Soviet system, which had its own problems, the main one being, in my opinion, a very low value placed upon human life. When I was in school I read that in order for our troops to take Berlin before the Allies, for this indefatigable will for victory, we paid one million lives. In the 20th century Russia lost an enormous number of values, including respect for individualism and people’s trust in one another. The modern system of capitalist norms exacerbates the problem: we lack a system of values and ethical norms, there are no moral heroes and the role models were forgotten. For this reason, I think it is fundamentally important to develop a model of human interactions where people can realize themselves and feel like individuals.

You just outlined quite a sad state of affairs in Russia. But all of your projects one way or another can be referred to by the inspiring slogan “The impossible is possible.” That’s how you built Troika, and that’s how you built SKOLKOVO. What motivates you?

I simply believe in good. My father always said: “Evil is like the flu. A sick person infects everyone in the crowd and draws a lot of attention.” Evil circulates easily. It makes for better subjects of books, movies and essays. But evil is a kind of foam that goes away. What it leaves behind are normal people with normal, healthy wishes, who want to live a peaceful life. And they need to be provided this opportunity.

You once said that in your view the world isn’t split between black and white and that you understand that the world consists of many shades of gray. This appears to be sound logic, but there's something dangerous in it: it’s very easy to live when any step can be “stuffed” under a shade of gray. Despite that, do you believe there are immutable values?

This question is simultaneously very general and too personal. Clearly there are universal commandments before which everyone is equal. But in addition to these commandments, there is a values system for each individual person. These values are formed under the influence of family, life experience and different kinds of circumstances. I’ll explain through some simple examples. I don’t advocate protesting and various types of demonstrations. I believe revolution is dangerous and harmful to a society’s development. But on August 19, 1991, I took to the streets with others to fight for freedom. And last December I attended an anti-fascism protest on Pushkin Square. My friends said to me: “Why are you going? Why do you need this?” But I knew there was no way not to go. I understood that at exactly that moment I had to state my position, because inter-ethnic conflict is a real and serious danger for Russia. It’s very important for me that my children and grandchildren not hear any tarnished words about me. Because I myself know what great fortune it is when your forebears’ admirable way of living has given you the opportunity to calmly walk the streets with your head held high.

How about your parents? What influence did they have on you?

My father is an architect and a professor. He taught architecture and many buildings were built by his design. My mother is a chemist-technologist. They both studied in Moscow. Of course, my sister also played a key role in my upbringing and in building my system of values.

Did you mature at an early age? Which events influenced this process?

Yes, I matured at a very early age. My sister is ten years older than me. When she was eighteen, and I was eight, our parents went to work in Africa. We were left with our grandmother, but our great grandmother suddenly fell ill and our grandmother had to leave as well. My sister and I were left alone. I then understood that I, as the only man, bore all the responsibility. I went to the store, cooked cutlets, and basically helped my sister however I could. I also watched my sister’s friends, read her books, played cards with her friends, ran to get cigarettes for them. That’s how I matured.

You once said that you still dream of becoming a musician or an artist. Why didn’t you realize your dream in childhood?

You didn’t understand me exactly right. I was talking about something else. In my opinion, there are three professions in the world that have to be respected and valued above all others. This is teaching, medicine and creativity. All the other professions are secondary. It turned out that everyone in my family draws, writes, plays… I was the only one who lacked creative talents. I started earning money because I didn’t know how to do anything else (laughs). But I continue to dream about artistic pursuits.

Will you have a say in your children’s choice of profession?

I think it’s very important that children choose their future profession on their own, acting independently in the world. In this sense, I don’t think there are any unacceptable choices. Let them work in the special services if they want, or work in show business if that’s what they want. The range of opportunities today is very broad; all it takes is desire. If my son wants to be a good carpenter and will find such work rewarding – I’ll be only happy.

Where do you want your children to live?

Today the borders are disappearing. This is obvious, and the new generations don’t always align themselves with a particular nation or government. Today you can be born in England, work in Brazil, vacation in France and love Russia. For example, I always knew that if Russia were to become imperiled, I would go to war. This wasn’t even a question for me. For today's generations nothing is that absolute. But what I believe in strongly is that every person should have roots. You have to know and respect your past and look to the future.

And your roots are in Armenia?

I was born in Yerevan, but I left Armenia when I was seventeen. I didn’t even have an Armenian passport. Today, unfortunately, my Armenian is much worse than before. As a child, I spent a lot of time in Russia and Georgia. This is because my mother is one-quarter Georgian, and her relatives lived in Tbilisi. So beginning in childhood I felt comfortable in different worlds, but for me Yerevan is a small homeland. I grew up there, consider myself Armenian and take pride in this.

What do you especially value in Armenia?

I feel a very strong bond with Armenia. In the Soviet era, my father received a plot of land with a view of Ararat. The plot was mountainous, and he built special rock ramps to keep the ground from disintegrating. I went to help him. I remember these feelings very well. Surrounded by stones, ground and sun…. You feel entirely different in such a place. Time freezes, space is filled with some kind of mysticism and the tranquility seizes you. That’s the only place where I've had such feelings.

Are there times in your life when it seems that just a little bit more and the “sky will fall,” when the burden of responsibility seems unbearable? Typically, people call this stress.

I tend not to fall into depression. I’m able to grumble and I do so often, but I always remain an optimist. And responsibility doesn’t weigh on me at all. I’m well aware that I bear responsibility for people and the company. But this is easy, so long as there’s a goal.

What’s the goal right now?

I want to create an actual charity industry in Russia, and make it professional and accessible for any person working according to transparent reporting. Other key topics for Russia's development in the 21st century include: medicine, education, intellectual law and creativity. We should work diligently so that precisely people become the main value and main asset for the future. There are only three ways of achieving fundamental change in society: inquisition, revolution and reform. Unfortunately, the first and second approaches usually win out. But I truly hope that we will follow the path of reform.

In which fantastic future scenarios do you believe?

That’s too serious a question. I remember a joke on this topic. Gorbachev calls Ryzhkov and says: “We have two months to find a scenario for saving the future.” Two months later Ryzhkov comes back and says: “There are two plans: fantastic and realistic. Here’s the realistic one: we’ll put a laser on Spassky Tower, send a signal, and then the Martians will come and fix everything.” Surprised, Gorbachev asks: “This is which option?” “The realistic one,” Ryzhkov answers. “And what is the fantastic one?” – “The fantastic one is when we do everything ourselves.” Of course, that’s just a joke. But to answer seriously, I believe that it will all work out for us under any – even the most fantastic – scenario.

While interviewing for BOSCOMAGAZINE, I can’t help but ask about your relationship with Mikhail Kusnirovich. How did he convince you to talk?

We’re in total resonance. People often confuse us, but we’re not entirely similar – and not only on the outside. I’ve known Misha for seven years, I love his family, and I have tremendous respect for his projects. One skating rink on Red Square is worth a lot. Another admirable story is the “Chereshnevy Forest” festival. In a word, I tip my cap. I’m very happy that life has brought us together.

What’s more important for you – friendship or family?

Family. That’s indisputable.