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. Last Updated: 07/27/2016

Growing Up With the Russian Stock Market

VedomostiYuryev was very careful in naming his company, Aton, which is the Egyptian sun god.
Yevgeny Yuryev, founder and president of the Aton investment bank, began doing business when the Russian stock market was formed, and he's grown up alongside it.

Starting by selling vouchers and moving on to attract investment for Russia's biggest companies, Yuryev has built one of the leading investment banks in Russia from scratch.

But his history as a businessman is stunning in its simplicity: Aton was created without any major start-up capital and Yuryev didn't have connections with those in power. "I just grew up with the market," he says.

There was no need for him to do battle with the big players on the market; they didn't exist, Yuryev says. Even now, there's plenty of room for everyone, he says, and this why there was no media war between the brokerages like there was between banks and oil companies.

Yuryev loves his work, he says, and he's not just in it for the money. For a long time, he never realized he was rich.

Five years ago, when Aton's turnover was in the billions of dollars, he rented a simple two-room apartment with mismatched carpeting, Yuryev recalls. "We were young, sparks ran up and down our spines, we needed to move forward and we had no need for money to spend on consumer goods."

Yuryev is enthusiastic about the local economy and convinced there is a bright future ahead for the stock market.

"In 2002, the Russian economy is facing a decisive trial: It must demonstrate that it can grow while oil and gas prices are falling," he says. "If the prices for oil are kept at above $15 per barrel, both the economy and the stock market will grow."

But for all his emotion, Yuryev is a realist. On several occasions, he has fundamentally shifted his company's priorities in line with the changing market.

Yuryev says he chose the direction of the business by chance, while strategy developed as a means of increasing capital.

"When you have nothing, it wouldn't occur to you to sit down, take a blank sheet of paper and sketch out a business plan for a Russian brokerage or investment bank," he says. "We just found ourselves on the stock market, which was at an embryonic stage, while we were one big, happy embryo ourselves."

But Yuryev took a very serious approach to the name of his company.

"Psychologists recommend that the name of the corporation be masculine, be no more than four letters long and start with capital letters," he says.

Flicking through a dictionary, Yuryev found the name of the Egyptian sun god, Aton, traditionally represented as a circle surrounded by rays. "Just two years ago, I learned that Aton in Old Church Slavonic means 'holy land,'" he says, delighting in the successful choice of name.

Aton began with three employees, working out of the apartment of Yuryev's father and selling whatever came along. Their success came with the start of voucher privatization. Started from nothing, the company had turnover of about $1 million per day by the end of privatization.

Henceforth, Aton's development mirrored that of the Russian stock market. Aton took part in auctions on behalf of its clients. The company brokered deals on the secondary securities market. New clients poured in hoping to invest in the securities market and conduct mergers and takeovers. Aton began providing all these services.

The events of August 1998 are a bitter memory for all financiers -- and Yuryev is no exception. During the crisis, Aton lost one-third of its $95 million capital. It was impossible to say how the situation would develop, and Yuryev decided to turn Aton into an investment bank.

"We grew up as a company," Yuryev says. "Before the crisis, we serviced virtually no Russian clients. We were called a boutique; the minimum amount we worked with was $250,000. Our traditional client base in 1996 and 1997 was made up of Western investment funds."

Western clients vanished after the crisis, and business had to be regeared toward Russian clients -- who were harder to work with. They were smaller, but there were a lot more of them.

Massive expenditure was called for in marketing and technology, but they managed to create a Russian client base.

Over the last two years, Aton's turnover has been about $4 billion. Of this business, two-thirds is with Russian clients. This year, about 30 percent of the company's income is expected to come from its investment-banking work, while the rest will come from its work as a broker. Aton has a number of projects in the works worth several million dollars, Yuryev says.

"We are an independent and universal company, we can do everything -- from evaluating businesses to managing the operations themselves," he says.

Yuryev denies rumors that Aton was the object of a takeover by the Trust and Investment Bank.

"For partners, selling shares is a good opportunity," he says. "But for the kind of business that we want to develop, it represents a loss, because it is specifically our independence that allows us to work unhindered with any group and organization."

Besides Aton, Yuryev is an active participant in the Delovaya Rossia association, which he calls "a wonderful idea."

Unlike the Russian Union of Industrialists and Entrepreneurs, which represents big business, the aim of Delovaya Rossia is to develop a powerful body to lobby for smaller businesses, with a turnover of less than $500 million. Yuryev is responsible for pension reform issues at Delovaya Rossia.

But how did he manage to turn a small firm that bought and sold vouchers into one that is highly sought-after by the biggest Western investment funds? Yuryev's recipe is simple: Find the right people.

He is humble about the role he plays.

"I was always very lucky in building the company -- it's my fate. To a large extent, Aton developed because it employs people who are a lot brighter than me. My job is to be the company's face. I come to investors and say: 'Here's Aton and here I am, the main shareholder, the president, the company's face, the face you can kick.' But I'm sure that's not going to happen."