In Red Notice, Bill Browder details his journey of investing in Russia as the country began to privatize major industries while also battling corruption and human rights issues. Bill’s grandfather, Earl Browder was the presidential candidate for the Socialist Party in 1936. Bill’s parents and siblings pursued careers in academia, and Bill rebelled by chasing as much money as he could. 

Bill’s career path includes working in Eastern Europe for Boston Consulting Group, Robert Maxwell, and Solomon Brothers. The work is mostly miserable, and Bill’s avid interest in Eastern Europe and Russia leaves him isolated from colleagues. His experiences traveling to backwater industrial towns in Russia uniquely prepared him to create an investment fund at a time when no westerners deemed the opportunity worth the risk. 

Bill finds unbelievable investment opportunities as the Russian government liquidates large energy companies. The private citizens holding the stock do not recognize its value, and there is almost no publicly available information on any of the financial metrics of the company.

Browder is creative and unrelenting in his pursuit of accurate financial information, and his effort is rewarded with massive investment returns. He runs into terrifying confrontations with oligarchs and the Russian government who want to eliminate Browder and his business success. The business landscape is lawless, and ultimately, one of Browder’s attorneys, Sergei Magnitsky, is imprisoned and killed.

The last section of the book follows Bill as he pursues justice and legislation on behalf of Sergei and his family. Bill is successful in passing the Magnitsky Act which is intended to punish Russian officials responsible for the death of Magnitsky. The Act authorizes the U.S. government to sanction foreign government officials worldwide who are deemed to be human rights offenders, freeze their assets, and ban them from entering the U.S.

I found Red Notice equal parts enjoyable and terrifying. Bill tells fascinating and funny stories of his time in newly opened Russia, and his ability to follow a new path leads to immense wealth creation. The book ends sadly even though landmark human rights legislation passes in honor of Sergie.

Bill spends a lot of time detailing the challenges and sacrifices he makes in pursuit of wealth, and he mentions at the end of the book (after he has amassed $100M), that he would trade it all to save Sergei’s life. I found this at odds with his singular pursuit of wealth. Bill succeeded in developing massive wealth because he made choices that 99.9% of people are unwilling to make. He chased huge risks, sacrificed his time with family, and ultimately ruined his personal safety.

Quotes

“The moral is simple: when it comes to money, Russians will gladly—gleefully, even—sacrifice their own success to screw their neighbor.”

“There were 4,500,000,000 reasons to return to Moscow so regularly. This was the total dollar value of assets under management by my firm, Hermitage Capital. I was the founder and CEO, and over the previous decade I had made many people a lot of money. In 2000, the Hermitage Fund had been ranked as the best performing emerging-markets fund in the world. We had generated returns of 1,500 percent for investors who had been with us since we launched the fund in 1996.”

“It bears mentioning that in Russia there is no respect for the individual and his or her rights. People can be sacrificed for the needs of the state, used as shields, trading chips, or even simple fodder. If necessary, anyone can disappear. A famous expression of Stalin’s drives right to the point: “If there is no man, there is no problem.”

“Because these auctions were so bizarre and hard to analyze, few people participated—least of all Westerners. This resulted in an acute lack of demand, which meant that the prices were remarkably low, even by Russian standards. Although Salomon was effectively bidding blind at each auction, I’d carefully analyzed every major voucher auction in the past, and in each case the price of the shares started trading at a significant premium to the price paid in the auction—sometimes double or triple.”

“In the end, I recommended that we participate in a half dozen auctions, including the sale of Lukoil, a Russian oil company; Unified Energy System (UES), the national electricity company; and Rostelecom, the national phone company. By the time we were done, Salomon Brothers had used these auctions to become the owner of $25 million worth of the most undervalued shares that had ever been offered anywhere in history. Bobby and I were convinced that Salomon would make a fortune. We just needed to wait.

In a short time our $ 25 million portfolio was transformed into $ 125 million. We had made $ 100 million! With this success I became a local hero on the Salomon Brothers’ London trading floor, where I had finally found a desk. The same “buddies” who had stopped inviting me for lunch and drinks were now lining up at my desk each morning before I arrived, hoping I might throw them a bone to help them make five times their money in the Russian stock market.”