‘Education is the most important hiring criterion for international companies’

Foreign investment plays a huge role in determining how the Russian economy will recover after its long illness. The RDIF accompanies most of those transactions. But, as HSE graduate and RDIF Investment Department Vice President Mikhail Kireev explains, the organization also has a social mission, in particular, to develop medicines and vaccines. In this interview with Success Builder, Mr Kireev also explains why HSE graduates are sought after, how the RDIF chooses companies for investment, where you can get an international degree when borders are closed and what constitutes a global education.

Why did you decide to earn a graduate degree and what made you choose HSE and the ICEF programme specifically?

I’ve known about HSE since I was in school. I was interested in economics, so I enrolled in a preparatory school at HSE. This helped me to win a prize for basic entrepreneurial and consumer knowledge in an Olympiad academic contest. That automatically gave me the maximum possible score in Economics for the entrance exam (which, as I found out later, was more than enough to ensure admission). I then passed the rest of my exams and entered the Faculty of Economic Sciences.

In my second year, I became interested in applied disciplines such as economics and firm finance. I had been thinking about graduate school, and the ICEF Master’s programme in Financial Economics appeared just as I finished my fourth year. I decided to enrol because I had always liked ICEF and regretted a little that I hadn’t entered the programme right from the start. My thinking was that a master’s degree would be a logical continuation of my studies and would give me a deeper understanding of the financial tools I would need in my future work.

To be honest, the first year was not easy for me because the programme is very strong and focused on academics. Also, most of my classmates came from institutes with strong technical backgrounds, the Moscow Institute of Physics and Technology in particular. The subjects themselves had little practical application, but it was still a good experience in terms of the ability to absorb and process new information and work with completely unfamiliar and difficult material. All these skills really helped me later. While still a student, I received a job offer from UBS. That was an interesting experience of being immersed in real-world practice on a completely new level.

How did you manage to combine working at UBS and studying for a master’s degree? How do companies feel about employees’ education and the academic field in general?

It is almost impossible to combine them, so I decided to finish my studies, get my diploma and only then take a full-time job. Education is the most important criterion for international companies selecting job candidates. When UBS looked at my résumé, I had just entered the labour market and didn’t have any professional experience. For the company, it was important where I had studied, how much I had gotten from the university, my command of English, which practical subjects I had studied and which useful skills I had. I believe that both the Faculty of Economics and the ICEF Master’s programme helped me a lot, and I felt I had a clear advantage over other applicants, at least in my command of English and knowledge of corporate finance. The work was done in London and Moscow. My international education came in use not just in an abstract way, but also practically: it gave me an understanding of global processes and intercultural communication.

This year, many students have considered alternatives to foreign degrees in economics, and ICEF is one such option. How prestigious is an ICEF degree in the field of finance?

Of course, you can hardly compare a full-fledged education in London, and particularly at the London School of Economics (LSE), with LSE’s dual-degree programs in other countries. In London you get, first of all, immersion in the culture of the largest university with a time-honoured history and immersion in the culture of London itself as a global financial hub. But in the absence of such an opportunity (and now is not a very favourable time for studying abroad), dual-degree programs are clearly the best option. The advantages of such programmes are obvious, not only to me but also to employers. They provide if not a complete, then a very deep immersion into the Western academic culture while preserving the strengths of the Russian educational system.

What are the advantages of dual-degree programmes?

Global education consists primarily of communication between students and instructors who have an interesting research background and have studied at various universities around the world. You are immersed in a different society with its own rules and values and you need to adapt to this, which is a very valuable skill. After that, you will have to compete for jobs against native speakers and, in general, against strong candidates who have managed to land good internships abroad. All this forces you to work harder to stand out from the crowd somehow so that employers will notice you. Even studying in Russia under programmes of foreign universities, you find yourself in a new environment where they teach in a different language, have much higher demands in terms of workload and performance and offer internships and studies in summer schools abroad.

In an international environment, your level of communication and worldview as a whole rises to a qualitatively new level. Communication with such people is a real pleasure for everyone involved, regardless of whether it is a business negotiation or a personal conversation. It is no secret that investment banks and private equity funds, in particular, are companies with rather aggressive corporate cultures, and are not easy places to work or climb the career ladder.

That’s why it’s better to start as early as possible in learning how to present yourself, communicate and work with constructive criticism — and moderately stressful conditions can double the speed of this process.

Why is IB considered such an aggressive field?

I think it’s because the deadlines are so tight and there’s so much competition between banks. In this work, the quality of the product and the speed of the work play a big role. You have to maintain constant contact with senior colleagues to make the needed changes in the materials in time. For investment funds, the quality and profitability of the projects you invest in are important. Several different funds can bid to invest in a successful project. You should offer the best terms and prove yourself so that everyone understands that if you become a shareholder, the fund you represent will create added value for the company, both now and down the road.

From the standpoint of the competitive environment, this affects your interaction with other members of the investment community. The result is that this is an industry of fierce competition, where one of the main values is to succeed no matter what. It is logical that in such an atmosphere, those who are prepared psychologically and physically to work a lot, and who can handle the stress are the ones who will survive and thrive. The rest simply can’t cope with that level of stress. But, once you’ve worked in IB, you can go into more laid-back fields, and then you’ll see how much you’ve learned from that race to achieve results.

What motivated you to go into investments?

When I analyzed various employment options as a student, I came up with a combination of factors that determined what would be a good job for me. These include interesting tasks, opportunities for career growth and the compensation package. I looked for work according to these criteria. Of course, there are many other fields with more interesting activities, but in most of them, you can wind up working the same job for many years. That, unfortunately, affects both compensation and how monotonous the work process is, ultimately leading to frustration. There’s plenty of routine work in the investment business as well, but once you’ve carried out your projects successfully, you move up to the next level and the tasks change and you gain new skills and knowledge. The chances for advancement, the deadlines that keep you sharp and the opportunities for growth ensure that you stay driven, despite the stress and the long hours. This is a very specific type of work-life balance, where you have an interest in working and progressing in the industry.

How does IB experience help a person’s CV?

This depends on the field in which a person is seeking work. When moving within the industry, the employer looks at the brands you worked for, your achievements and regalia. But that is only at the initial screening stage. At the follow-up interview, the applicant must be able to convince his future employer that the projects and investments he worked on were successful, describe exactly which tasks were involved and specify in detail the scope of his responsibilities. In IB, it is important to be a team player, but also to be able to achieve results in the area for which you are responsible. If you are looking for a job in a different field, then experience in the investment industry shows that the person is hardworking, ambitious, psychologically strong and able to cope with deadlines.

What do you think helped you at the start of your career, and what do financial organizations generally require of new hires?

First, a diploma from a good university gets you in the door for an interview. Solid knowledge gained during your studies will enable you to perform well in the interview. Honestly, though, what happens after that has little to do with what you studied. During my first months on the job, it was very difficult to fully understand the tasks I had been assigned. I simply didn’t have the detailed knowledge I needed of this or that industry. However, university training helps because you just have to sit down and figure it out by, for example, studying the metallurgy industry from scratch so that you can then build a financial model, prepare a teaser, presentation, memorandum, and so on.

What distinguishes HSE students from others is the especially competitive environment and the rating system it has. The university aims everything at making the student want to be better, which greatly aids any graduate who is just starting out with an investment bank.

Based on your experience, which skills are most important in career advancement?

Recalling UBS, where ICEF and MGIMO students competed at the final stage of selection, I can say that the HSE students had excellent soft skills, qualities that make it easier to work at the international level. This is not only because the subjects are taught in English and or because there are foreign teachers on the faculty, but because the whole style of education at HSE makes it possible to hone not only your technical but also your communication skills, which take on great importance later.

In a modern university setting, through the discussions you have with teachers and capable students, you can strengthen your outlook and learn to respect others’ opinions and yet still convince those around you of your position.

This makes them very bold in demonstrating their knowledge. HSE and ICEF, in particular, have useful career services that help students hone various soft skills. Graduates of technical universities don’t compare with HSE students when it comes to getting interviews with investment banks.

Do HSE students get this audacity from the lack of barriers?

Exactly. As an undergrad, I worked on a research project with my academic advisor, Mark Levin. Before that, he had always seemed unapproachably lofty. Nonetheless, we had a very friendly working relationship and my article ‘The Economics of Terrorism’ won a prize in the Student Research Paper Competition at HSE. Some of the teachers in the master’s programme had recently earned their PhDs and were not much older than we were. This also broke down a barrier because it was easier to communicate with them and discuss various topics that were not always directly related to our studies. In particular, they talked a lot about their research experience. Ours was the first graduating class of the ICEF Master’s programme and that unique experience of communicating with instructors helped many of my classmates decide to go on and earn their PhDs.

At what point did you start working for the RDIF? What qualifications do they look for in applicants?

Of course, while working at the investment bank I also wanted to try myself on the ‘buy-side,' and such an opportunity presented itself with the creation of the RDIF. It helped that I had experience working on specific deals in different industries. My interviewers were familiar with these cases and there was a lot we could discuss even at that stage. Job applicants sometimes refer in their résumés to transactions in which they were only indirectly involved and from which they did not gain any key experience. Employers like it when the applicant was not just cc’d about the deal but was really actively involved and is ready to answer questions about it. A hint to future graduates: prepare thoroughly before an interview. Study your résumé and think about which questions they’ll want to ask in order to dig deeper into your experience.

How are the relations between Western investors and Russian companies? In what do foreign financiers invest?

Of course, the pandemic and everything connected with it has had a strong effect on the investment climate, as well as on the overall economic performance of the country and individual companies. But foreign investors continue to look for profitable, and in the case of Russia, sometimes super-profitable projects. However, several industries have grown and strengthened considerably because of the pandemic. One is online TV, and in particular, the ivi.ru project that we invested in last year and re-invested in this year. During the pandemic, it had an audience of 60 million unique users, with the paying audience growing by 50%. People spent more time at home watching TV and the quality, accessible content ivi offers played an important role in this.

Another important area is connected to the pharmaceutical industry. The RDIF actively invested in three segments of the fight against COVID-19: tests, drugs and vaccines. The Fund received a very good response in each area and we are very happy with these investments. One could say that these investments partly had a social aspect: the Fund invests not only to make money but also to help the country, its portfolio companies and the economy as a whole. We also invested in Yandex, which became one of the beneficiaries of the pandemic and managed to advance its online services significantly, demonstrating strong operational results and excellent growth in shareholder value.

How do you select the companies you offer for co-investment to foreign investors?

There are certain segments that analysis indicates could be the best targets for investment. Primarily, it is the profitability and the level of risk we are prepared to assume in each case that determines the choice. Our foreign co-investors share the profit and the risk with us, investing funds in selected projects on analogous terms. In turn, working closely with our foreign partners, we can monitor trends on the Chinese or Arab markets, identify promising technologies or companies that have already gone through beta-testing in local markets, and correlate our own experience with these data. For example, we have a technology partnership with the Mubadala sovereign wealth fund of UAE that helps us analyze venture capital histories based on its experience of investing in similar sectors in international markets. We then bring this knowledge of outside markets to bear when selecting the best investment candidates in Russia.

Has the RDIF hiring policy changed in any way in recent months? What type of specialists is the Fund currently looking for and how relevant are IT skills coupled with financial expertise?

We still have an internship programme and we continue to recruit new employees. In fact, just the other day I interviewed a candidate from ICEF. Our selection process is not simple, but we maintain career links with universities and post vacancies in specialized channels. In particular, we work closely with the ICEF Career Centre.

As for IT skills, they are an advantage in any company now, but this is not a determining factor for job applicants to the RDIF. I work in venture capital investments. This is a current focus of mine and, of course, when I interview people applying for analyst and associate jobs, it is important that they understand IT because I know how useful these skills will be for them. I learned them on the job, but they are not fundamental skills. It would be useful to have someone on the team who could analyze from a technical standpoint this or that technology we are targeting for investment. This type of employee is essential for funds that invest in early-stage and B2B technologies, and in industrial start-ups that are tied to technological know-how. At RDIF, we enter the picture at a later stage of investment, after the technology has already proven itself, been recognized and become scalable.

You have to interview job applicants. Which qualities does RDIF value in HSE graduates?

I usually conduct final-stage interviews with all candidates up to the position of vice president. When I interview someone from HSE, and especially from the ICEF, the first thing I note is his or her strong command of English. This is important in our organization because we at the RDIF spend a lot of time interacting with our foreign partners. Even at the interview stage, you can feel the special culture of the ICEF students. They are prepared to reason, explain and argue their position. I sometimes ask open-ended questions to get a better sense of their reasoning process. HSE graduates perform much better on such questions than other applicants do.

For example, I might ask which stocks are best for investment. I often disagree with the answers, but if the person presents a logical argument, I can change my mind. From this, I see that the person has a position and why.

A previous Success Builder interviewee who was also an ICEF graduate said that a good education eliminates the collective unconscious and enables you to hold your own opinion.

I agree with that 100 per cent.