♪ haslinda: hello and welcome to "high flyers." a show that gives you a 360 degree view of asia's business in the east. today, we meet a man who is not afraid to voice his opinion, is outspoken personality has meant to numerous high-profile controversies, but that has not stopped him from reaching for the price, like building australia's largest online retailer, kogan.com.

let's meet ruslan kogan greater >. have knew the only way to something was to own it. he taught himself to think outside the box and set up a string of ventures. his challenge to the status quo continues to this day. time now for this highflyer to join us on the singapore flyer to tell us about his past, his presence, and his ambitious future. haslinda: ruslan kogan, welcome to "high flyers." you have this big idea, this lightbulb moment while shopping for an lcd tv at age 23. what happened? ruslan: the roots happened while i was studying in miami a bit before that.

i noticed all the local kids were buying everything online. they were buying it for much cheaper prices than all the international students. we go to walmart to buy our stuff because that is what the university told us was the best marketing economy to scale. then i see they're buying things online for much cheaper. i realized that a small online retailer can operate with greater efficiency than a goliath like walmart. a few months or years later, i n australia, i was searching and looking to buy an lcd tv. i saw that i could not afford one -- they were really expensive at the time. i decided to contact some factories out of china to tell them hey, i wanted to buy 100,000 tv's, hoping they would give me a quote. then i would ask them for a

sample, and i was going to be my tv. when they provided a quote, i saw there was a huge gap in the market. a tv i could get in australia for $1000 was selling in the shop for about $3000. so, i noticed that gap and thought back to my days in miami. i thought online tv's are a perfect product. online retailer is all about maximum value per cubic centimeter. and here you are shipping a thin box around the country. perfect for logistics, perfect for everything. i quit my job and started importing tv's. haslinda: you needed to convince the chinese suppliers to provide you with a small number of tv's and other products as well. how did you convince them? ruslan: things came to a halt pretty quickly because after i had chosen the factory to work with, i contacted them and said

i don't want to do in order for 100,000 tv's. i want to do one container of 80 tv's. they laughed at me. i was in a tough position because i quit my job. the fact which it telling me that we can't do 80 tv's for you because china is all about mass production. haslinda: you did something for them first. ruslan: correct. to me, a business is all about win-win. how can i make this a win-win? out of all of the factories i spoken to in china, these multibillion-dollar organizations, a lot of their marketing material was in chenglish -- it did not make sense. none of the images were aligned. this spreadsheet had numbers sent -- i don't like it when people send numbers. numbers need to be right in line with decimal places. i read did all of this for them. i translated the chinglish to english. i made everything makes sense.

i annotated it. i made it look like a professional, western document. i sent it back to them and i said look, there may not be any value to you in my tiny order of 80 tv's, but there are other ways i can add value to this transaction. as a result, they replied a few hours later thanking me and accepted my order. they gave me an even better price than we had previously negotiated. haslinda: not everybody is buying into this kogan.com story. you have flaws of criticisms. among them coming from your own rivals. some said that you don't respect intellectual property rights. the biggest criticism came from jerry harvey. he said you are a con. everything you promised is a con. your response? ruslan: to get that reaction out of jerry, i take that as a compliment. [laughter] haslinda: is there truth in that? ruslan: that we are a con?

we operate a business with millions of customers in a country with an amazing legal system. if we were a con, we would've been found out by now. instead, we have millions of happy customers. we believe we respect all intellectual property law. we have never had anyone prove otherwise. but there is no doubt we will have critics. we are changing the way retail is done in australia. haslinda: your mom was not convinced. when you tried to start your own company, you had a full-time job with -- a proper job. she says why are you leaving a well-paying job to be a tv salesman? ruslan: not only did she say that, she started crying. [laughter] ruslan: it was tough, because i'm trying to explain to a crying mother that i'm not really about to be tv salesman. i'm starting a direct to consumer online retailer. where we manufacture our own private label products and

deliver them for better prices. she didn't really understand. now she understands what we do. she no longer cries and she is very happy. back then, it was tough to convince her. in fact, i did not convince her. i just had to go out on a limb and do what i thought was right. haslinda: what is the biggest setback you faced? ruslan: i should've bought the kogan.com domain on day one. you know. business launched, i kogan.com.eu.ain i didn't buy that, we expanded internationally then i had to buy kogan.com for a number with a lot of zeros on it later. [laughter] ruslan: that is a mistake. i learned how important intellectual property is. mistakes ar how important it is to protect all of intellectual property. mistakes happen along the way. the most important thing is that from every mistake, you learn the hard truth. you acknowledge the fact and then you ensure that it never happens again.

>> coming up -- ruslan: when the social network movie came under four want to be in entrepreneur. which is weird, i did not want

haslinda: ruslan kogan equates unconventional. anyone looking for a job would with you had better not be sending his or her resume by hotmail. why is that? ruslan: someone who uses hotmail, chances are they set their e-mail up 15 years ago and have just never bothered to look at what else is out there. newer technologies have come along like gmail, which lets you search or e-mails much easier. we use that internally in our organization. also, we look favorably people that have their own domain name. somebody who purchased their name and uses that as their e-mail.

we want tech-savvy people. we want people who know how to research online. people who keep up with technology, who swim against currents. that is one of those little things. e-mail address, that says a lot about you. we have logical reasoning tests that we send to everybody who applies. haslinda: is it fair to say that the typical profile of your employee is either the gen y, the millennials? haslinda: it would be. yeah. people who grew up with the internet are much more likely to succeed when they apply for a than if they do not know how to use the internet. haslinda: the average age would be 26? ruslan: 26, average 27, at 32 i am one of the oldest. haslinda: that is ok, because you're the boss. you do not believe in official training becauseradin

you say all the answers are right there. google. ruslan: correct. we think formal training is for people that want to look like they're learning. google is for people who actually want to learn. for a lot of our senior managers, formal training isn't an option for the most of the things we are doing, no formal training exists. by the time something gets into a university degree, it is all old information. whereas, if a new piece of software comes out today, you can learn about it tomorrow on google. we are solving problems for the first time. that is why we need to teach our staff not to rely on others for information but to go out there and get it themselves. haslinda: you don't reward your employees in a natural way. there is no one-time you look at promoting them or rewarding them. anyone is able to walk up to you and justify a promotion. ruslan: when i worked in the corporate world, i knew -- i

learned a lot about what not to keep staff motivated and to build the great workforce. one of those things was the annual review process. once a year in september, you sit down with your boss and they discuss things and give you a 5% pay raise. it causes staff to -- in august, everyone is there at 7:00 a.m. and going home and 9:00 p.m. and everyone is working so hard. the pay review comes in october. so we learned that to run a meritocracy. what we implemented at ko gan, any staff member, we don't care how old you are. whether you are male or female, what university degree you have. we care about degrees will be hire you because a university degree means you can read and write and commit to something. for three years or four years, but beyond that, we don't care what you have done in your previous job. we care about what you're are doing right now.

as a result of this meritocracy, we have staff who have had six pay raises in six months. there was one 19-year-old, six pay raises in his first six months, earning six digits of the senior management team. we value what your actual performance is rather than any external bureaucratic commissions. haslinda: nine years ago, it was one store. nine years later, it is still one store, but you have grown from one employee to almost 200. how big do you think kogan will become? ruslan: you are spot on. nine years ago, one store, now one store, in 10 years' time, we will still have one store. we're all about scalability. we will build it from there. we're building our online presence. if he said to me five years ago, how big will kogan be in five years time? i couldn't have guessed it would be where it is today. being a retailer turning over of dollars.millions

if you said where was i going to be in five years, i'm not even brave enough to have a guess. haslinda: when was it that you knew that you had something big? ruslan: the business started by selling true kogan brand tv's. they grew a little bit in the electronics range. when we started that growth, i realize that the growth realized that this business model works for whatever product we decide to put through our manufacturing and supply chain. at that point, i realized that the growth potential of this business is enormous. haslinda: a $1 billion company in no time, is that possible? ruslan: look, if you choose the graph for what was done in the last nine years, you would have a billion dollars within the next few years. haslinda: you are an entrepreneur. but more and more people are calling themselves that. do you think the term is been

diluted? ruslan: i have never called myself an entrepreneur, as such. that is more a title i let others call me. my facebook says i am a toilet paper changer because i still change the toilet paper rolls. you have to do everything in a business when it is growing fast. when "the social network" movie came out, i think it made entrepreneurship more glamorous. because everybody watched it and said, hang on a second, going by this movie, two hours ago mark zuckerberg has zero, now he has tens of billions of dollars. everybody wanted to be the entrepreneur after that movie. which is weird. i did not watch "spiderman" and decide that i want to be a spider. that movie made entrepreneurship glamorous. i think that is a great thing. what people fail to acknowledge a lot of the time is the

contribution this makes to society. there is an entrepreneur behind every product or service, losing sleep, thinking -- how do i make it better? haslinda: how much sleep did you lose trying to grow your company? ruslan: i do not think i have lost any sleep because i voluntarily jump out of bed every single morning. it is tough. i've had some people come to me and say things like, you know what? i want to be an entrepreneur like you. i am sick and tired of the 40-hour week. that makes me laugh on the inside because the last time i did that was in the corporate world. haslinda: you work up to 100 hours a week. ruslan: sometimes more, usually between 70 hours to 100 hours per week mark. i love what i'm doing. i jump out of bed. i jump out in the middle of the night if i have an idea. i write myself an e-mail. it doesn't always make my girlfriend happy, but it is a great feeling.

when you love what you do. >> coming up -- ruslan: you get addicted to the game. that's what make you jump out of bed in the morning. ♪

haslinda: ruslan, yours is the perfect immigrant story. mom and dad left belorussia, came to australia with 1989 with just $90 in their pocket. they had a hard life to ensure that you had a better one. ruslan: definitely, and i appreciate it so much more now. i have grown up, and i get to understand what they went through. i also now credit a lot of what i have achieved with kogan to the life lessons they taught me. because when you think about what it takes to be an immigrant or an entrepreneur, they're very similar. to be an immigrant, you have to drop everything you have got, take a massive risk traveling into the unknown. an entrepreneur does exactly the

same thing. watching my parents arrive on $90 and work three or four jobs each, my dad worked as a taxi driver during the night. mom would be a cleaner at one café, a waitress at another. they were studying english as well as trying to educate themselves for a better life for their kids. it made me have an incredible work ethic and determination. i knew from a young age that i can do anything as long as i work my butt off to do it. haslinda: mom and dad were highly qualified as well. mom qualified medically, your dad was an engineer by training. how did you feel seeing your dad and mom holding those jobs when they were highly qualified back home? ruslan: i was 5.5 years old, so it did not click with me. i didn't understand. my dad has a masters in engineering, and here he is driving a taxi or working at the victoria market.

the same with mom, it just doesn't click. you learn to appreciate those things as you get older. you reminisce about it. i think about it now, and i thank them every single day. haslinda: in the early days, you lived in public housing. ruslan: we grew up in the housing commission flats in melbourne. haslinda: and you always pass a canal. tell us about that canal and how significant it was. ruslan: it was significant that as a little kid, all the bigger kids were jumping over it. i would always climb the barbed wire fence and try to jump. i would come home with a wet shoes. i finally managed to jump over it. but also that it ran through the golf course. in the canal, you would find washed-up golf balls. i would collect them. i would wash them and then sell them back to the golfers. that was the first money that i ever earned myself. haslinda: since then, you

started about 20 or so ventures. that was the start of your entrepreneurship. experience. ruslan: yeah, so from a young age, my parents taught me that if i want something, i have to earn it. with the golf balls, it wasn't a golf balls, it wasn't a big wasn't big money. it was $10 or $20, but that makes you king of the milk bar. i would buy whatever candy i wanted. after that, it led to my parents giving me $5 to wash their car. we were in a shopping center and they saw a big billboard that said carwash -- half-price only $40. i thought hang on a second, i am getting ripped off. i printed up these business cards and dropped them off the neighborhood. i packed a hose in a few sponges and walked around and people are paying me $15 to watch their car. i started taking bookings in

and hiring some of my friends because i cannot do it all on my own. there was that, then mobile phone repair. there have always been a lot of ventures along the way. obviously all culminated in kogan.com, which is my baby. haslinda: you're worth about $350 million and counting. one of the richest young people in australia. has life changed? it would be a lie if you say it hasn't. ruslan: certain things changed. like, i never got to go into the high flyer before. [laughter] ruslan: here we are, seeing all of singapore. i fly at the front of a plane now. i drive a nice car, yes. it is a modest apartment. the things i really enjoy the money hasn't really changed. like, i love fishing. i wish the fish new how much

money is my bank account, but they don't. i don't catch any more. haslinda: isn't it cliché to say the money doesn't matter when you already have it? ruslan: if you look at business people around the world, steve jobs kept going until it a few weeks left. why, because he really wanted the money? why is richard branson turning up to work? because he really wanted the money? why is rupert murdoch working? because he really wanted the money? no. i could retire right now and never work another day in my life. i could have whatever i want, my kids would never have to work, and their kids, and their kids and their kids. you get addicted to the game, and you love the challenge. entrepreneurs create all the products and services that enhance their lives. they thrive on competition. that is what makes me jump out of bed in the morning. haslinda: speaking of richard branson you put a down payment , of $200,000 to go to outerspace. ruslan: when i saw the virgin galactic program launch, it struck a few chords with me.

one was that, like, as a little kid, you say you want to be a n astronaut. and by the time you reach 10 years old, 15 years old, you realize that is not going to happen. then at the age of 28, i realized that might happen. it struck a chord. the other one being that both russia and the u.s. have sent 498 people into space and the over $500 billion on their space program. that is over $1 billion per person into space. richard branson is doing it for $200,000. i am a capitalist. i love free markets. this is a perfect symbol of what a private enterprise can achieve and what government can achieve. richard branson is sending people into space for 1/5000th of the cost of what governments have done it for in the past.

based on that, i felt an affinity to the program. that is why i've joined. but mom is not liking the idea of you going to space. [laughter] ruslan: mom despises the idea. mom keeps telling me you're not going to go as long as i am alive. i might have to do what i did with skydiving with her, where i flew to new zealand saying i have a few business meetings and went skydiving, and then she saw the video on youtube. she nearly killed me. she told me not to go skydiving either. i might just say i'm going camping in the mojave desert the . we will see what happens. haslinda: how would you like to be remembered? ruslan: how would i like to be remembered? that it's a good question. probably by the things that are most important in life. i want to be remembered as a good son and a good brother.

they are for me the most aborted things at the moment. haslinda: thank you so much for being on "high flyers." it was a pleasure. ♪

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