Knowledge of chess was key in formulating his business strategy

Q&A: Chess Not Just a Game for Infrastructure Oligarch
29 March 2012
By Howard Amos

Though he said he hadn’t played chess for a year, infrastructure oligarch Andrei Filatov knew the risk of defeat was negligible when he agreed to a match with a less-than-talented Moscow Times reporter in the offices of the Russian Chess Federation.

Within a few moves there was little doubt about the outcome.

“You can’t start a military campaign without setting up your troops,” Filatov said, half-kindly, when asked for his analysis after the inevitable had happened.

Before entering business in the 1990s, Filatov — ranked by Forbes as the 74th-richest man in Russia with a personal fortune of $1.3 billion — trained as a chess player. He said he would have become a professional were it not for the collapse of the Soviet Union.

Confirming the suspicions of his unworthy challenger, Filatov, 40, admitted that he could have won even more swiftly if he had wanted. “What does it matter how long the game will take when the result is obvious?” he said. He had been toying with his opponent.

The Ukrainian-born businessman stepped publicly into the colorful world of Russian chess late last year when he said he would sponsor the World Chess Championship. The match — the biggest in the chess calendar — will be played by Soviet-born Boris Gelfand and India’s Viswanathan Anand in Moscow this May.

The event will also be sponsored by billionaire oil trader Gennady Timchenko who is rumored to have close ties to Prime Minister Vladimir Putin.

While he plays infrequently now, Filatov said his knowledge of chess was key in formulating his business strategy. The ability to calculate risk is essential for both. Filatov was dismissive of the difficulties facing foreigners looking to invest in Russia and pointed to his own experience and Russia’s history as evidence.

Since the early 1990s, Filatov has been in partnership with schoolmates Konstantin Nikolayev and Nikita Mishin. In 1996, they set up SeverstalTrans with Alexei Mordashov, now the owner of steelmaker Severstal and Russia’s third-richest man. Filatov and his partners bought Mordashov out of SeverstalTrans in 2008, creating N-Trans.

From 1998 until 2004, the deputy director of SeverstalTrans was Igor Levitin, the current transportation minister.

Through the Cyprus-registered N-Trans, Filatov and his partners have stakes in numerous infrastructure ventures. The most high profile are GlobalTrans, Russia’s biggest private freight rail group, and Global Ports, which controls 30 percent of the country’s container traffic. Via their holding company Marc O’Polo Investments, the businessmen also have a stake in infrastructure company Mostotrest, which specializes in bridge construction.

N-Trans works not only in Russia, but also has interests in the countries of the former Soviet Union. Filatov, who Forbes placed amongst the top 1,000 wealthiest men in the world in March, said he was probably the biggest private investor in Estonian history.

Filatov elaborated on the links between railway wagons, oil terminals and chess in a an interview with The Moscow Times, which has been edited for length and clarity.

Q: When did you become interested in business?

A: I started doing business during my student days — I was studying chess in Minsk. When the Soviet Union started to fall apart and the country began to open up, I became involved in typical student business ventures. I went abroad for the first time for an international chess tournament in Poland, but the tournament didn’t happen. All the participants in the tournament were supposed to go home, but they were experienced and had brought goods with them and began to sell them. I didn’t know [that was possible]! But I saw that it was very profitable. The next time I went, I sold electrical goods that I had brought with me.

Q: How profitable was it?

A: I had a stipend of 40 rubles. At that time about 16 rubles would get you a dollar. I had a grant of $2 or $3 — to live on it was not easy. For me to earn $100 [selling electrical goods in Poland] was very profitable. You could live well.

Q: Which people have influenced or inspired you?

A: There was no such person in business. In chess, it was my coach Alexander Sinitsyn who worked with me from the age of 10 to 16. He was a good man.

Q: When did you first become interested in chess?

A: My father played chess with his friends, and, as a child, I watched. That’s how I became interested. It is hard to say whether my father was a good chess player or not. He died when I was in first grade. I went to training sessions from the third grade and began to understand something about the game.

Q: What are the chess matches that you remember the best?

A: A child’s emotions are always stronger. We won a regional competition at school that we really wanted to win, and the victory allowed us to go to a tournament in Odessa — for fifth graders it was real travel! From Dnipropetrovsk to Odessa.

Q: When did you stop playing chess?

A: In 1991. I finished [university] but had already given up playing chess and become distracted by business. I had discovered a great interest in business — it was similar to chess. I was captivated. It was also necessary to survive — those were difficult times.

Q: How do chess and business influence one another?

A: You have to evaluate risk everywhere. When you make a move you are always judging what the answer will be. You are calculating the risk — what the probability is of a certain chain of events. There are a lot of similarities between chess and business.

In more concrete terms, I will admit that I played chess for big money in the early 1990s. Very big. The time I wasted as a child on chess, I bought back in its entirety! It was more money than the prize fund for the World Chess Championship [$2.5 million]. One game was with a respectable oilman. He put up mazut [fuel oil], and I put up a contract for transportation services. Russian style. We played very seriously. My hands were trembling. But I won.

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