It’s miserable being an oligarch – I’m happier as a peasant, says man who once challenged Putin
As the fortunes of Russia’s super-rich oligarchs begin to crumble, a man who was once one of them has some surprising advice: they should acknowledge their folly in ever believing money could bring happiness, and then follow him back to what he believes is the good life.
German Sterligov has enjoyed sumptuous wealth, sampled the world of glinting limousines, private jets and super-yachts, and mixed with stars at lavish parties, but he gave it all up four years ago to live with his family like a simple tsarist-era peasant in the wilderness, often struggling to make ends meet.
It is like Sir Richard Branson throwing it all in and downsizing to a self-sufficient smallholding in Newport Pagnell.
The good life: The Sterligov family at their humble home
‘Most of my friends thought I had taken leave of my senses, but four years on, well, I think I have been proved right – and I’m far better placed to withstand the global economic crisis than most of the oligarchs,’ says the 42-year-old.
He is speaking of powerful men including Chelsea Football Club owner Roman Abramovich, rumoured to have lost £13billion in the global financial crisis, Lord Mandelson’s friend Oleg Deripaska, down £10billion, and the secretive Alisher Usmanov, who owns a large stake in Arsenal Football Club and is said to be £7.6billion poorer.
‘I’m in clover compared with them,’ says Sterligov. ‘I’m free here. I don’t depend on anyone and we’re totally self-sufficient.’
Sterligov earned his fortune aged just 24 when he set up Russia’s first commodities exchange in the twilight of the Communist era. By doing so, he became Russia’s first legal millionaire since the 1917 Revolution.
At one point he employed more than 2,500 people and was feted in America as a new type of Russian, a welcome change from KGB colonels. He mixed with the likes of Bill Gates, Ted Turner and the Rockefellers.
Then suddenly it all changed. Sterligov and his 41-year-old wife Alyona sold their four-storey, 20-room mansion in Rublyovka, Moscow’s most exclusive neighbourhood known as Millionaire’s Row.
He also waved goodbye to his New York penthouse with views of the Statue of Liberty, offices in Wall Street and Central London, a retreat in Geneva, a castle in Burgundy and his headquarters in Red Square, Moscow.
He gave away shares worth hundreds of millions of pounds, while Alyona exchanged her jewellery and designer clothes for the traditional long skirt and headscarf worn by peasants in Tolstoy’s 19th Century novels.
The couple and their children pitched a tent in a lonely forest clearing while they built a humble home – with no electricity, despite temperatures in winter plummeting to a bone-crushing minus 45C.
Their log cabin was ready just ten days before Alyona gave birth to their fifth child, whom her husband helped deliver.
Last week, as Russian oligarchs tumbled from the Forbes rich list, Sterligov spoke at his two-and-a-half acre smallholding about the reasons for his radical change in lifestyle.
‘Not in a million years do I want to be a businessman with these silly shiny badges of success – the Rublyovka houses, swanky yachts, Bentleys and so on,’ he says.
‘I’m happy with my peace in the countryside, and my sheep, along with my wife and kids.’
Germany in 1992 when he ran Russia’s first commodities exchange
As Sterligov made his way in business, he and his wife had lived with the constant fear of kidnapping or becoming victims of a contract killing.
‘In our first two years together, we changed our flat no fewer than 23 times,’ Alyona says. ‘He’d call me and say, “Pack up, we’re moving again” after some new threat.
‘In the circles in which my husband was working there were many people gunned down.’
It’s little wonder that most oligarchs employ armies of former special forces soldiers to protect them.
Alyona, whose family were close to former Kremlin leader Nikita Khrushchev, hated having servants.
‘I didn’t want strangers in my house. But there was an exception. I always had armed bodyguards.
‘After we moved back to Moscow from Mayfair, where we lived for a while, we found they were indispensable. We were very rich in a country where most people were not and where killings or kidnappings to settle business scores were rife. It was terrifying.
‘I always had at least two bodyguards with me and the children, but once we had a security force of 60 special forces officers to guard us.’
Her husband agrees. ‘We were like birds in a gilded cage,’ says Sterligov. ‘Being super-rich is a kind of slavery from which we’re free, thankfully.’
Sterligov even took to appearing at parties with other women, hinting that he and Alyona had separated. It was a ploy used by many couples during the era of wild capitalism under the rule of Boris Yeltsin.
‘It was to prevent us, his family, becoming targets from jealous business rivals, pretending we were not so important to him any more,’ says Alyona.
‘We used to speak about the madness of our lifestyle but I never imagined he would just walk away.’
Another key factor in their decision was Sterligov’s ill-fated attempt to challenge Vladimir Putin for control of the Kremlin in 2004.
It was a step too far. Sterligov was barred by election officials from standing and in the process – for dubious reasons – he lost the tens of millions that he had invested in the campaign.
‘He came home, threw down his jacket, and suddenly said, “I can’t do any more here. Let’s go and find a new life,”‘ recalls Alyona, to whom Sterligov had proposed just three minutes after their first meeting.
They chose to step back in time to the days of simple Russian folk during tsarist rule, in a rural area 60 miles from Moscow.
‘We have two modest houses now,’ Sterligov says. ‘This one is for the winter, where we have hens, geese, turkeys, several goats, two cows – not much, but enough to keep the family and our friends going. And we have another house 12 miles away for the summer. It’s closer to pastures for the sheep.’
Since moving, the couple have thrown out every photograph of their old life and Sterligov has banned his family from watching television and using the internet.
‘There’s no point in wasting the children’s time with these brainwashing devices,’ he says. ‘Better for us all to gather at the table and discuss a new book instead of watching garbage on TV.’
The boys – Arseniy, ten, Sergiy, eight, six-year-old Panteleymon and four-year-old Mikhei – do not attend school. Instead handpicked, old-fashioned tutors visit their home to teach them maths, history, Russian and hand-to-hand combat.
The couple’s daughter Pelageya, 18, is now at Moscow University as a prelude to marriage to a man approved by her father.
Only slightly in jest Sterligov says: ‘Will you please caption her picture, “18-year-old, ready to get married, well brought up, father will give 300 hectares of land to the man who takes her hand. Seeking a 35- to 40-year-old, a strong and intelligent prince on a white horse”?’
The children are raised strictly in the Russian Orthodox faith and Sterligov defends his methods. ‘Pelageya speaks Greek, Spanish and English. They all read books in old Slavic and very few of the teachers I’ve seen can do the same,’ he says.
The boys dig vegetables, milk the cows and make traditional peasants’ timber stools, which sell for about £120 each – more for the wealthy, less for their poor neighbours in Nizhnevasilyevskoye, their nearest village. ‘Usually we sell two stools a week – that buys food and clothes and pays for their teachers,’ he says.
They also hunt, and the older boys and Pelageya are adept with guns.
But Sterligov discovered that quitting his old existence did not stop the threats. Their first log cabin was destroyed by arson and their dog was poisoned
. The reason for the attacks is unclear, but the result is Sterligov is again fenced off from the outside world, as he was as a billionaire.
A sign on their gate reads: ‘Entry forbidden. Territory is guarded by dogs. Entering with guns is considered to be armed attack.’
The house does have an internal lavatory and a washing machine, but otherwise there are few concessions to the 21st Century. The family uses a horse and cart or horse and sleigh to get about. Water is fetched from a well.
When they first went to live in the wild, there was no electricity. Lighting was by candle and heating from a wood-fired stove.
‘Since last year, we got a power supply at our winter house, and electric bulbs. Don’t ask how many. If I count, I’ll die from happiness,’ said Alyona.
In other ways, the rhythm of life is much as it would have been in the time of Tsar Nicholas II. Female visitors are told to wear long dresses in accordance with the old ways. Sterligov himself wears a beaver fur hat, thick sheepskin coat and brown leather hunting boots.
There are two bedrooms – Alyona sleeps in one with their daughter, while Sterligov shares the other with his four sons.
If all this seems eccentric, the house has a feeling of warmth and love despite the cold outside. The children, certainly obedient to their father but not cowed by him, speak intelligently for their age and have survival skills no longer taught to many modern youngsters.
Sterligov’s retreat still stuns the Russian elite who knew him as a swashbuckling entrepreneur.
‘He is an unusual character,’ says former Russian deputy prime minister Boris Nemtsov. ‘There are very few people, in big business in particular, who would dare give up everything and do a farmer’s work.’
Alyona, right, and Pelageya both wear long skirts and headscarves
Sterligov is adamant that he could never leave this new life, a feeling shared by his wife. ‘I don’t miss the diamonds or the other flashy jewellery, the shopping trips, the short skirts or the luxuries,’ she says. ‘I’m much happier now.’
Yet 18 years after setting up his historic commodity exchange, Sterligov has again been stalking Moscow’s business corridors.
‘One day I was sitting on a tree stump and I realised this was the ideal time for a new idea to help these oligarchs trapped by the nets of an old system and their outdated vision. So I dug out a couple of million euros I had stashed under a large oak tree.’
He is joking about the buried euros – probably – but he has got together with some former business colleagues to pursue an idea that he claims can save Russia’s foundering financial system. The scheme is a money-free commodities exchange based on bartering.
His exchange is operating from a Moscow skyscraper and attracting some attention, and Sterligov is in negotiations to set up a London branch.
He calls it ‘an anti-crisis commodity transactions centre’ through which cash-strapped companies can barter goods instead of paying for them in the traditional way.
‘It is an electronic substitute for money, not linked with the dollar, euro or rouble,’ he explains.
By using computers and the hated internet, Sterligov hopes that this can be done on a vast scale, creating chains of commodity deals that might get the economy moving again.
So far, economists are lukewarm about the idea but, he says, ‘time will tell who is right’.
Even if Sterligov is successful though, he insists this would be only a cameo return from his real life. ‘Who am I now? Just an ordinary peasant. A chicken and turkey keeper, a shepherd. I don’t think Putin worries about me now.’
Of the ‘struggling’ oligarchs, Sterligov says: ‘I don’t think they’ll become street beggars, but their huge empires are doomed to death. In many ways they were, from the beginning, built on borrowed money and unreal growth.
‘I don’t see them much these days, as you can imagine, and they’re too busy working on rescuing what they’ve got.
‘My advice would be the opposite – use whatever resources you still possess to build a new, more sustainable system.’
Indeed, Sterligov predicts the global recession will see other billionaires following his lead.
‘Lots of them are jealous. They are tired of being prisoners and see how I roam free on my horse, like a Cossack. I have no one to boss me around.’
Does he have a tip for his former peers?
‘Not just for my oligarch friends but for everyone in this crisis – buy products, flour and salt and sugar. All of you. You will need them.’