Multimillionaire Alexander Yaroslavsky: Money loves silence

DCH Investment Group’s founder Alexander Yaroslavsky is one of the richest businessmen both in his native Kharkiv and Ukraine. According to various estimates, Yaroslavsky’s wealth ranges from $770 million to $900 million. The entrepreneur’s talent to promptly and accurately invest in promising companies and niches helped him create a powerful business empire. DCH manages its assets in retail, real estate, transportation and hospitality businesses. Investment projects of the group include Premier Palace Hotel Kharkiv, Kharkiv International Airport, Kharkiv Stadium, Caravan Shopping Mall and others.

Like most Ukrainian businessmen, Yaroslavsky has been showing interest in agricultural business. For the second time, he initiated Agroport — a major three-day event that combines an agricultural exhibition and forum. The event was held in one of the Kharkiv airport terminals. According to Yaroslavsky, Agroport 2014 exceeded all expectations, so he decided to organize it annually. The main objective of such forums is to catch the interest of potential investors. Why is Yaroslavsky, an active investor himself, concerned about how to attract additional money to Ukraine? The billionaire told about this in his interview for LL.

LL: The topic of attracting investments is extremely urgent to you now. Which sectors, in your opinion, can attract investors under current conditions?

Ukraine has more than 42 million people, so it will always be interesting to investors under any circumstances and at all times. However, the fundamental problem today is a military conflict in Ukraine. Investors will never put money in a country experiencing an extremely unstable situation. Yes, we are in talks with a large number of funds and companies, but they all have one question: when will peace and quietness come to your country? What can spark their interest? What can Ukraine offer them? Almost all industries, in which the investors’ funds are accumulated in other countries (agriculture, oil and gas production, IT industry) are presented in this country. We are located in the center of Europe. We own 30% of world’s reserves of black earth soil, huge reserves of iron ore and a huge human capital. The main question is the problem of peace. Everyone is waiting for the situation in the country to stabilize.

LL: In varying degrees, businessmen, politicians and bureaucrats are trying to attract investors to Ukraine. Much is spoken about this topic today. However, it is probably easier for you to communicate with investors because you invest in various industries and understand what the dialogue with foreign partners should be focused on.

You are right — we communicate with them in the same language. But now we are discussing not the project profitability and ROI numbers, but the political situation. And exactly because of my good understanding of investors’ logic I have no illusions about their willingness to work on real projects under current conditions. I can influence the military conflict in no way. All I can do is to organize such events like Agroport. This is the only way to convince people of the advisability of investing. Any investor is primarily concerned with peace. We all know the famous expression “Money loves silence”. I understand what these words mean very well.

LL: And you have organized Agroport. Despite the conflict, today the forum participants discuss the prospects and investment attractiveness of Ukraine’s agricultural industry.

Agriculture is one of the driving forces for the Ukrainian economy — 2.4 million hectares of agricultural land (2 million hectares of which are arable land) are concentrated in the Kharkiv Region alone. How can such a scale leave investors indifferent? My goal as a Kharkivite is to tell them about this in an extremely fascinating way. Agroport itself is a platform where people will better understand the potential of the Kharkiv Region after communicating with each other, as well as think, why not to invest any money here? I do not have the habit of stopping halfway, whatever project it would concern. Therefore, I intend to continue the tradition of organizing annual Agroport events. This year’s forum gathered much more participants than in 2014. It means that people are interested in my idea.

LL: Do you plan to invest in agricultural business yourself?

I always study new investment opportunities. Agricultural business is no exception. However, I have no specific projects now.

LL: If you do decide to invest in something, will you make a direct or portfolio investment?

I like doing business on my own. Speaking about portfolio investments in Ukraine… Frankly, I scarcely believe in them.

LL: So you would like to engage in agricultural business…

…I would run this business on my own.

LL: You will create your own agricultural holding, won’t you?

Yes, I will. Exactly so!

LL: In recent years, the owners of largest agricultural holdings in Ukraine often invite potential foreign investors, show them their companies and talk about the prospects of doing business in this country. Could you mention foreign investors you know personally, whom you invite to Ukraine?

I have been engaged in an ongoing dialogue with some companies and foundations in Switzerland and the USA. However, I would prefer not to mention them because we are not working on any specific projects right now. I do not like small talk — only the cases of real cooperation should be announced. There is no urgent need to lead investors by the hand. When they realize that it is profitable to invest here, they will come quickly. Our task at this stage is to remind them of our country and its potential regularly.

Naturally, great things are not done all alone. In order to lift the Ukrainian economy we need more than a dozen and even more than a hundred investors, who are disposed to a long and serious game. Everyone should do what he does best. If I were a doctor, for example a surgeon, I would transplant the heart… No, in case of Ukraine, I would transplant the brain… But it is not about this. I am not a doctor; I am an investor. And I try to fulfill myself in this area.

LL: What projects do you invest in now?

I am currently developing the theme of the real estate for retail and the retail business. We have several Caravan malls and continue to expand in this sector. We support the existing projects at a decent level.

LL: Do you invest mainly in Ukraine, as you always did before? Or do you have plans to globalize your capital investment?

Yes, I do have such plans. I have several projects abroad, but we still talk mostly about Ukrainian investment. Nobody is waiting for us abroad too much. There is no lack of investors there.

Written by: Alisa Illinskaya