How an immigrant from Uzbekistan refused to do business on Wall Street and went to Russia

Редакция vc.ru talked with businessman Farid Gazizov. He told several stories about how he left Uzbekistan to the USA, learned economics, started working on Wall Street, opened his own trading company, earned 2008 of the year on the crisis and came to Russia to become a startup.

Photo vc.ru

From Uzbekistan to Wall Street

I was born in Uzbekistan in 1977 year. My first entrepreneurial experience took place when I was three years old: I saw a bag of dried sunflower seeds on my grandmother's wall and decided to sell them.

The adults laughed, and I took the seeds, built a counter in front of the house and put two glasses. But I did not sell anything: my aunt drove me home, who was returning from work. In the USSR, entrepreneurship and trade were not encouraged, especially if it was trade outside the state. Such people are scornfully called "shopkeepers."

Everything changed with the collapse of the Soviet Union. At the institute, we shared with fellow students information about who sells what. I had a whole book with phone numbers and the cost of various goods.

I called up with other guys and offered what I had in stock, and they leaked their orders to me. We had a small network exchange. It came to such rare things as deep water pumps.

My sales hit are sets of books on learning English. They went off like hot cakes. I did not have a warehouse, I was an intermediary - I set my price and I sold what I wanted. It all depended on my arrogance.

We also dragged furniture from another city and sold two or three sets of upholstered furniture a week. This was in 1995-1996. I can not say how much I earned at that time in terms of rubles, but my income was higher than that of my parents. At the institute, I did not take money from them.

In 1997, I left Uzbekistan and received a grant to study in the United States and spent a year there. When he returned, he graduated from the university with a degree in economics and accounting, then received another grant and again went to the USA, having received there another degree in finance, accounting and management.

After graduation, I went to work on Wall Street with a friend. Got a financial analyst (trader) in the company ETG. That was in 2001, almost immediately after the dot-com Bubble, when the NASDAQ index fell more than 1.5 times.

Our generation has replaced the fattened 1990-s traders. They learned how to make easy money, but it was extremely difficult for them to work under tough conditions. A new generation was brought up in harsh conditions.

In 2005, the structure of our company has changed. The management began to crack at the seams, and my boss (the head of the office) left, and all the rest followed him.

After five months, we together with him created the trading company Nich Capital. I saw the opportunity to scale it, and a year later we had 50-60 traders.

Weekday trader

My favorite TV show is Billions. The way one of the main characters, Bob Axelrod, thinks and makes decisions, is very characteristic of Wall Street. Of course, much of the series remains at the level of a fairy tale, but some things are very realistic. A close friend of mine manages a single hedge fund.

I also like Silicon Valley. He laughed with tears in his eyes, as in many situations he was himself. Wall Street and Flint Valley are two different groups of people. We are about money, and they are about technology.

Now their spheres overlap because Silicon Valley is beginning to threaten Wall Street. I rarely came across guys from Silicon Valley. Mainly collaborated with hedge funds, traders and analysts.

All the traders who were in my office, played cards and ran to the casino. All of them were players, only their strategy was different: some acted aggressively (“gamblers”), some - measuredly (“grinders”).

I remember the phrase of my friend: “If you earn, but do not spend, then the meaning and hunger is lost. You do not realize why you need it. " Therefore, traders (especially young) bleed.

If you make money and don't appreciate it, it becomes difficult. Therefore, they went to the casino. But there was a problem: they won there too.

At some point, for the sake of sporting interest, I learned the technique of counting and memorizing in blackjack. A little later, I started playing semi-professional poker and in 2002, I went to a Las Vegas tournament. I won first place among the 150-200 people and won the top prize - $ 5 thousands.

Among traders (and in the USA as a whole) it is not customary to discuss earnings and brag about money. You can sit with a successful man who will be dressed in a simple way. And so much so that you can confuse him with a bum. It's great when a person is important, not his money.

Traders from my close circle earned over $ 50 thousands per day for one trading session. But in comparison with Jordan Belfort's The Wolf of Wall Street team, it was a penny.

And although they were not far from us, we did not know each other. We fought for our capital, but they sniffed cheap stocks and tightly bred people. They had a good sales technique. Bastards, of course, that so bred, but they sold hard, you need to give them their due.

The best moment for me came when shortly before the 2008 crisis of the year, Fed Chairman Alan Greenspan turned on the printing press. There were a lot of pros and cons.

I started to enter gold at $ 750-850 per ounce. In the end, after three or four years, I entered $ 1600-1800 - this was the peak and long-term position of a good size. I played it exactly as needed.

But there were failures. In 2008, I missed a good chance when I bought an asset that cost $ 1,5-2 per share. We accumulated a massive position, and she continued to move up.

Fundamental and technical parameters of the asset were good. He quickly reached a value of $ 3 per share and doubled my capital in less than a month.

But the trader's instinct told me that I had to take chips from the table and not be greedy, so I sold part of the shares. The asset has reached $ 4. I completely left the position on $ 4, and the asset reached $ 12 in two to three months.

I didn't earn as much as I could. My trader instinct says never to be greedy and not to look back. But sometimes I make this mistake again. If you start to focus on this psychology, you will lose.

I also find it difficult to play on oil. I can not predict a change in its value, because geopolitical games are involved here.

In an office on Wall Street. Photos from the personal archive

The 2008 crisis of the year was not a surprise for us with a partner. We waited for him for three years. When such orgies occur (and it is difficult to call what happened then with a different word), then they do not end well. At that moment, prices were going up.

I kick myself because we didn’t come out massively. We had to do what the protagonists of the movie “The Game for the Fall” did. Scion Capital hedge fund manager Michael Burrie was two steps away from bankruptcy. Everyone called him, and he just sent everyone nafig.

At that time, my wife offered to buy real estate. I fought off her for three or four years. I understood that the market is overheated, the bubble is inflated, it is impossible to buy, because it will all end badly.

We lived in rented accommodation, and I discouraged many of my friends from buying my own. Few people listened to me and many friends lost money by buying two or three houses during this period.

They did not leave the position when it was necessary to leave. This is greed. The main enemies of the trader are greed and fear. It looks like I'm looking at everything through the lens of a trader.

It was possible to play a raise and a decrease at the same time. I only played short, and that was my mistake. In the 2008 year, when everything collapsed, we purchased real estate four times cheaper - at 25 cents per dollar.

I also played well on the fall of Starbucks. When the recession began, I analyzed how the American consumer would behave. It is obvious that in a crisis you will not drink coffee at $ 7 per cup.

I would continue to go to the cafe, but a little lower price segment. In the end, I invested in the Panera Bread network. My predictions came true: Panera Bread shares rose, and Starbucks sank.

Back to Russia

The 2008 crisis of the year tested me for stress resistance, and the company for strength. And besides - my team management skills in crisis situations.

It is not easy to lead a team of traders into battle when the company is seven to ten days before the crash. In principle, like the whole economy at that time. It was necessary to raise not only their fighting spirit, but also those who stood nearby. These were terrible and difficult days.

Despite all this, 2008 was the best year for me. By this time, I had been working on Wall Street for the eighth year. I began to realize that I saw almost everything on the market.

Besides (as an entrepreneur), I knew that I needed to diversify my risks and start developing other businesses. I was thinking about moving. Chose between Hong Kong and Russia.

I was interested in Hong Kong as a financial center, because I knew that I would quickly find myself and think of something. There were other advantages in Russia: many unoccupied niches in businesses, a growing economy, and besides, I speak Russian. There were also personal reasons - the proximity of parents and the desire for my children to speak Russian.

I had no calculations, but I knew that I would definitely invent something on the spot. In the end, I chose Russia. At about the same time, I read The New York Times article on the Groupon coupon service.

I appreciated my strength and capabilities and realized that I could do a similar project in Russia. So I opened MyFant.ru. To develop a backend, I hired an outsourcing company. The first version of the site cost us $ 10 thousands.

She was so ugly that even now I am trembling at the thought of her. It was my “masterpiece”, developed without any design skills. It is clear that later there was a second and third version. I invested around $ 100 thousands in development at different stages. Over time, we hired our developers and grew up in an IT company.

When the site was ready, I tried to sell without any experience. I went to restaurants, sold them an idea or air, and also asked for a discount from 50% to 90% for their services.

Then I did not know how to sell in the b2b segment. In the trading business, I did not come across how to properly package a product, present it and sell it. But I needed to learn so that I could train the staff.

Having broken this wall with my head, I wrote a guide on how to call and sell “in the cold”. After a while I ran into Groupon coupon service sellers. I looked at their manual - it turned out to be very similar to ours.

The most cool feeling that an entrepreneur is experiencing is a thrill from the first dollar or ruble earned. I remember very well for two days - when I earned the first $ 100 on trading, and when I earned the first 100 rubles on a coupon site.

We earned a commission. For example, they came to the bowling center and said: “You have 10 tracks, three of them are unoccupied. They can be sold at a discount. ”

For example, in the center of the track cost 3 thousands of rubles. With our coupon - 1500 rubles. In order not to drive money through us, we charged users only for the cost of the coupon.

At the very beginning, in the wake of the hype, the coupon companies were all forced through. There were stories when businesses did not understand what they were getting into, and closed after holding coupon actions - they went into a hard minus.

They were selling not only the residual inventory of their sites, but also those places that could fill up - just to attract customers. Our service had one such case with a sushi restaurant.

They gave such a discount that they went below cost. I do not know whether they are closed or not, but this is a sin in my business. It is clear that they made the decision themselves, and we sold well.

But then, if the business offered us conditions that could kill him, we refused. We would get rid of both business and users who would come to the point, and the place is closed. I strictly forbade it.

Other coupon companies, where the owner does not control the sellers, bend many. Especially "weak" individual entrepreneurs.

I heard from some restaurateurs that they were bent on such a discount, and they remained in the red by $ 100 thousand.

At the beginning of 2010, I managed two companies, and the total number of my subordinates exceeded 100 people. I liked Russia because of the difference in time zones during the day I could be engaged in one business, and in the evening another. That is, from 9: 00 to 16: 00 I worked on a coupon site, and from 16: 00 to 24: 00 I traded on the exchange.

At the peak, in 2011-2012, the turnover of MyFant.ru exceeded $ 100-150 thousand per month, and the margin was 30-35%. Although this business was rather small in comparison with my trading business.

At this time, a major player, First Coupon Company, began to engage in buying services from the middle segment. In 2013, we began negotiations with them, but the conditions did not suit me. In 2014, we returned to the negotiations and closed the deal.

I cannot disclose the conditions, but the amount was a six-digit number in dollars. I know the conditions of buying other platforms, so I can say that we sold out better than anyone. We were the last ones they could buy.

To date, the cost of coupon services has dropped to 10-15% of the cost at the peak. This is well illustrated by the example of Groupon. At the peak, their shares were worth almost $ 28. Now - almost $ 5.

New business

In 2014, when I was out of business, I started working on mobile apps and loyalty programs. I had several attempts, but I kept digging and searching.

I founded the company Real Time Group. I originally planned to create a loyalty program for customers. Later, we developed a technology to recognize checks, identify bar codes and customers.

In 2017, I met representatives of the international investment company Embria. This is a good strategic investor who is close to me in spirit and specializes in IT projects (since 2007, he has invested in more than 20 projects).

Embria thought to create a similar service and decided to invest in my company. That was less than a year ago, the company invested 37 million rubles. Now we are communicating with four large funds already for the next round to scale.

The most important thing in attracting investments is who invests, not how much. Do not chase amounts, look for “smart” money.

It's easy for me to communicate with Embria. They compensate for my gaps. I understand what they are talking about, and we rarely have disagreements.

Now I am developing a product that helps users save on purchases. This is a marketplace, and a service for comparing food prices.

The product consists of several applications related to cashbacks online and offline. While it was launched only in St. Petersburg, and I am not ready to announce it. But we have already started earning the first money.

Here's how it works: the user fills the shopping list and presses the Compare button, and the application tells him where his basket will be cheaper: in Auchan, Ok, Lenta or elsewhere.

At this moment we send the grocery basket of the user to retailers-partners. And we say: "You have these products are 1000 rubles, and the competitors have 950 rubles, and the client will now go to them." The retailer has the opportunity with the help of our service to give the user a discount, lower the cost of the basket and "tear out" it from competitors.

Embria and I have been studying the business model for three months. We conducted a large study, studied the American, European (where the leader is Spain) and the Russian markets. A direct analogue of the service is only in England - called MySupermarket.

Embria offered to run in the US, but I insisted that we start with Russia. Because our team is here, and we have more experience in this market.

Development in Russia will cost us less. In addition, here the cost of the error will cost much less. If we rush in the US, then everything will cost 5-7 once more. So I decided to stay in St. Petersburg.

This decision surprised some acquaintances, because any start-up would rush to the USA. I can risk my money, but not strangers. Other people's money imposes more responsibility on me than my own.

I refused to take the money and go straight to the big market. On the one hand, this is not exactly “gambler” behavior. A gambler would say: "Capture the world." We plan to enter other markets after the company passes the “valley of death” in Russia.

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