Land Of Opportunity
In August, 1998, soon after launching a consulting firm aimed at helping U.S. companies do business in the former Soviet Union, Ian Bremmer got a surprise: the near-collapse of the Russian economy. He couldn't have been happier. "It's precisely because of the chaos that we are a successful business," says Bremmer, president of New York-based Eurasia Group.
Bremmer has built a thriving company by helping clients negotiate the confusing byways of post-Soviet commerce. Revenues for Eurasia Group reached $1.5 million in 1999, Bremmer says, and he expects them to soar as high as $5 million this year, thanks in part to widespread uncertainty about Russia's newly elected President Vladimir V. Putin. "Putin remains a huge question mark," he says.
Bremmer has thrived without a minute of business education or even much of an intention to become an entrepreneur. The 30-year-old expert in Russian and Central Asian politics--a Stanford University PhD--was on the fast track to the Ivory Tower. Then history intervened. After the Soviet Union disintegrated in 1991, U.S. companies eager to do business in the region were scrambling for information. Bremmer realized that his network of sources could be the basis for a profitable business. With the former Soviet Union changing so rapidly, Bremmer decided it would be interesting to do more than just teach about it.
In January, 1998, with just $25,000 in savings, he took the plunge. "For the first six months, it was trial by fire," he recalls, as he scrambled to learn such mundane tasks as processing a payroll, calculating taxes, and writing contracts. But he now has 15 people working for him in New York, Moscow, Istanbul, and Houston.
The company's 25 clients include Goldman Sachs, News Corp., and the giant Turkish conglomerate Koc Holding, each of which pay $25,000 annually for the group's basic services. That includes regular political reports, packed with insider information, as well as frequent meetings for companies with government officials and business leaders in the region.
Eurasia Group provides extensive problem-solving and dealmaking assistance, too. The company is introducing Metromedia International Telecommunications--a New York-based company that runs Russia's largest digital satellite and fiber-optic networks--to local partners for cable-TV and wireless phone businesses in Central Asia. If dealmaking picks up, Bremmer thinks annual revenues could soar as high as $40 million over the next several years.
How does a little guy compete against global powerhouses like PricewaterhouseCoopers and Ernst & Young? Bremmer sticks to his geographical niche and tries to offer more in-depth, inside political information, capitalizing on his network of 350 legal, business, government, and academic contacts in Russia and Central Asia. So far, he has attracted some big fans. Eurasia Group "is one of the aids that helps us make rational decisions in a marketplace that often behaves irrationally," says James Hatt, CEO of Metromedia, which is expanding its TV and phone businesses throughout the former Soviet Union.
What's next for the former academic? Eurasia Group's growth ultimately depends on the economic and investment climate in the former Soviet Union. Bremmer is guardedly optimistic. A new generation of business-friendly political leaders is emerging in provincial capitals around the region. But much depends on what Putin actually does as President. "Things can get worse before they get better," Bremmer says. If that happens, his Eurasia Group will keep trying to cash in on chaos.
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