Entrepreneur Ivan Kroshnyi has learnt some valuable financial lessons since setting up his first computer and office supply business in Ukraine at the age of 16.
While the business made him a millionaire by the time he was 18, his partner stole the company’s money and disappeared.
Now 33, Mr Kroshnyi says the experience was difficult but it helped him to understand the importance of partnership agreements.
“It was a good experience for me; it made me smarter, and I started another business and then another one,” says Mr Kroshnyi.
The Ukrainian multimillionaire moved to Dubai in 2021 and is an investor in the Roasters Specialty Coffee House chain, which has five branches in the city, with plans to open more this year.
He is also the founder of Eco Way, a Dubai-based business that aims to transform last-mile food and small parcel delivery services with long-range electric bikes that are equipped with swappable battery technology.
With a diversified investment portfolio worth about $20 million, Mr Kroshnyi says he lives a comfortable life but doesn't waste his money on expensive brands or cars.
What was your first job and how much did you earn?
I started my business in Ukraine 17 years ago, when I was 16. The business was selling computers and other things like printers and scanners. It was a good time in Ukraine because everyone changed their processing, from paperwork to computers ... I made my first $1 million when I was 18.
But then I had a problem and the business broke down. It was 2008-2009, during the global financial crisis. It was a difficult time and my partner just decided to steal all the money and disappear.
It was a good experience for me; it made me smarter, and I started another business and then another one. In parallel, I was trading on US stock exchanges and this was also a really good experience because I learnt how to manage risk and my finance plans.
I also made really good money trading … more than $1 million. This was the starting capital for my new business, a brokerage company with a very famous trader who was my teacher; Alex Gerchik is one of the top day traders on the New York Stock Exchange, and we started our own business.
This company is still operating. We have a lot of clients from around the world and also provide access to training to trade on US stock exchanges.
I also have other companies … a payment system inside our group with our own technology company for FinTech. We have an investment fund in the Czech Republic, land development, property development, property management and a lot of different businesses in the Czech Republic.
What is your current salary?
I receive Dh7.4 million ($2 million) annually through dividends from my investments.
Have you always worked for yourself?
Yes, all of my work is with my own companies. I have a lot of partners who have really good experience. I’ve had good and bad experiences in partnerships. But I like it because I have my strengths and I need someone who will make up part of a job where I am not so strong, for example, roster speciality.
I have a strategic view, I have international experience, I have investments, but I am not so good at micromanagement. My partner [in Roasters Specialty Coffee House] is really strong in micromanagement and is very effective in all of this stuff. It’s made our business strong because he's a really good operations manager.
Without a good team, without the people who will make it day by day, it is not possible to make a big business but with [a good] team, you can make 1,000 times more.
How do you determine your salary as an entrepreneur?
Actually, my Dh7.4 million [income] is after reinvestment. I reinvest a lot of money in other projects and it's $2 million from this.
What are your investments and savings?
I have an investment fund in the Czech Republic, it's very stable and I invest for long periods because if you buy some land, you develop it and start to build, for example, 10 villas or something like this – it's an investment for a long time.
In the Czech Republic, we have apartment hotels, with sort of seven rooms and stuff like this. It is my investment. It's for me and is more profitable than US stocks. I have a portfolio in American stocks but it's not big – $300,000.
Roasters Specialty Coffee House chain is an investment. All our branches cost me from $800,000 to $1 million. I have businesses where I invest my money and have a really good return on investment. It’s better than any side investment.
Do you have an emergency fund?
It's very important to have money that is liquid because, in life, there is always something that does not go to plan. For example, Covid-19, the war in Ukraine. You always have to keep some money in cash to cover one year of expenses.
Right now, I have $1.5 million in an emergency fund. I have a lot of businesses and if something goes wrong, I still have obligations and I have a big team. For example, we rented a new location for Roasters. I have to invest a large amount of money but if you have a lot of complications, [the emergency fund] it's not so big.
Were you taught how to manage money as a child?
No, I just read a lot. I read more than 100 books a year, every year, and it's helped me to find new information and knowledge to manage a lot of different sectors of my life.
My goal is to make at least $500 million through my investment portfolio in different types of businesses
Ivan Kroshnyi,
entrepreneur
What are your biggest monthly expenses?
I don't think my expenses are really big because I have no expensive cars, no expensive watches or anything like that. I look for good quality; it’s not just the brand that is central. And I think in my expenses, I am average, not something special.
I spend on travel because I like to travel a lot. I have no Lamborghini … I believe you have to spend money on something like travel, knowledge, health; something that boosts your energy level.
Do you ever worry about money?
Yes, during the time when I lost my first business. I invested all my money into this business and all my time. This was a part of my life when it was really hard.
What are your financial goals?
My goal is to make at least $500 million through my investment portfolio in different types of businesses like in the Czech Republic, like Roasters Specialty Coffee House, maybe a few hotels; something stable.
What is your idea of financial freedom?
I don’t spend a lot of money on anything; you can be free because you work a lot, learn a lot and have a good reputation.
I am sure that I can always make enough money for my life because it’s not an expensive life; it’s a very comfortable life.
Even if I lose, if something goes wrong, I have good diversification in my finances. I am sure that I always will make enough money for my life. Right now, in 10 years, in 20 years, I think it's been financial freedom [for me].
Do you want to be featured in My Salary, a weekly column that explores how people around the world manage their earnings? Write to pf@thenationalnews.com to share your story
UAE currency: the story behind the money in your pockets
THREE
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Global state-owned investor ranking by size
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Afcon 2019
SEMI-FINALS
Senegal v Tunisia, 8pm
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The bio
Studied up to grade 12 in Vatanappally, a village in India’s southern Thrissur district
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