Hermitage Fund's William Browder

My grandfather was the general secretary of the American Communist Party. And as I was finishing business school in 1989, I had a romantic attraction to the Soviet Union as it was opening for business. As an investment banker in 1992, I went to the Russian town of Murmansk to advise the managers of a state-owned fleet of 100 ships. Each ship cost $20 million, but the managers were being offered the chance to buy 51 percent of the entire fleet for $2.5 million. I realized that to make money in Russia, you had to invest directly in assets that were being privatized. In 1996, I moved to Moscow and set up the Hermitage Fund, which became the largest foreign investment fund in the country.

I figured that if I was buying at a heavy discount—and playing it out until Russia became a civilized country—I could eventually make 100 times my money. However, when Russia defaulted on its debt in 1998, the oligarchs started misbehaving. Our fund went from $1 billion to $120 million. I became a shareholder activist at companies like Gazprom, where we exposed that billions in assets had been stripped. We built the fund up to $4.5 billion.