About
About
A hospitality executive for more than 20 years, Jeffrey Zeiger managed several ventures in both the former Soviet Union and modern-day Russia, including the first American-owned restaurant chain to open in the USSR. From 1989 through 1995, Mr. Zeiger launched and managed TrenMos Restaurants, the first U.S.-owned restaurant chain in the Soviet Union. In addition to managing staff, banquets, marketing and general business operations, he worked with international and domestic business suppliers to develop an efficient supply chain and expanded the operation to include a total of three outlets in three years.
Between 2001 and 2004, Mr. Zeiger was Managing Director of VIP National Club and Casino in Moscow, a high-end establishment with $25 million in annual sales that offered a 110-seat restaurant and 14-table casino to an international clientele. In that position, he oversaw marketing programs, developed training programs and sales incentives for Russian associates, instituted Western-style beverage controls that resulted in improvement in costs, and created and oversaw new sales strategies.
From 2004 – 2008, Jeffrey M. Zeiger was a partner in the New Jersey restaurant and hospitality advisory firm Zeiger Consulting, identifying and evaluating potential development sites for international clients and advised Russian businesses on negotiating and business strategies with U.S. corporations.
Fluent in Russian, Mr. Zeiger attended the Cornell School of Hotel Administration and is married with 2 children.
Between 2001 and 2004, Mr. Zeiger was Managing Director of VIP National Club and Casino in Moscow, a high-end establishment with $25 million in annual sales that offered a 110-seat restaurant and 14-table casino to an international clientele. In that position, he oversaw marketing programs, developed training programs and sales incentives for Russian associates, instituted Western-style beverage controls that resulted in improvement in costs, and created and oversaw new sales strategies.
From 2004 – 2008, Jeffrey M. Zeiger was a partner in the New Jersey restaurant and hospitality advisory firm Zeiger Consulting, identifying and evaluating potential development sites for international clients and advised Russian businesses on negotiating and business strategies with U.S. corporations.
Fluent in Russian, Mr. Zeiger attended the Cornell School of Hotel Administration and is married with 2 children.
Daniel Satinsky: After we finished that, it really hit me that, on the one hand, I was writing about Russians coming to the US, but I had been part of and witnessed this large flow of Americans into Russia—which I saw very little written about, you know, other than a few scandalous stories. And I decided that I would like to tackle that story from the point of view of the people who were there, using interviews. So, it's both to provide a kind of framework of what was going on and then focus on the people involved.
Even that was way too big for a one-volume book, so I've pretty much cut oil and gas out of the picture, and I've cut out a lot of the sort of natural resource sector, to focus really on the sectors of the Russian economy that were non-existent in Soviet times and developed a lot with input from foreigners—Americans in particular. So, you know, real estate, finance, restaurants, media, telecom—these were areas which, you know, if they were there, they were underdeveloped in Soviet times.
And so, that's where I’ve focused. As of now, I've done probably over 105–106 interviews with different people to cover those segments of the economy. I have a contract with Routledge, the UK publisher, to publish the book, and I'm supposed to submit the manuscript in June. So, I'm working away at it and trying to fill holes in areas that I don't know very much about, or which I think were sort of seminal kinds of companies, if you will. I was lucky to get to John [Reuther] and, you know, hear his stories. He likes to tell stories—he's a good storyteller.
Jeffrey Zeiger: He's a great storyteller. I just spent some time with John down in Naples, as a matter of fact. I just came back.
Daniel Satinsky: Oh, okay, cool. I don't know, you know, what he said about our interview, but I enjoyed it.
Jeffrey Zeiger: Spoke very favorably. I told him our conversation was happening, and he said you’re very easy to talk to, and… Well, like you said, he’s a good storyteller, but he thoroughly enjoyed it, and I thanked him, and I’m going to thank you for even wanting to hear the story. And one of the things that interested me just now was when you cut out oil and gas and those kinds of guys, I knew all of them, because they all came to my restaurant, but that was really…the bigger companies is really not the story, because the bigger companies had the resources, they had the relationships. It didn’t matter who was in the Kremlin. You know, Chevron and all those guys, ExxonMobil—it was Exxon back then.
Daniel Satinsky: Right.
Jeffrey Zeiger: But those guys were there, and it was not as ballsy a decision for them to be the representative of Chevron, or IBM, or Microsoft, Pan Am, even, at the time. That was the airline at the time. Ballsy because they got hardship pay because Moscow was not Paris. That’s where the ballsiness, I think, ended because it was such a different level. So, I’m glad to hear, to be honest, that you are focusing on more of the entrepreneurial guys that did it on their own, which coincides with what the Russian economy—and Soviet at that time—really needed and didn’t have. They had oil and gas, they had diamonds, they had the natural resources. They didn’t have telecom. They didn’t have real estate. The government owned everything. They didn’t have what you and I know as restaurants. They had cafeterias that were horrible.
Daniel Satinsky: Stolovaya*.
Jeffrey Zeiger: Stolovaya, exactly. So, I think that that’s a really…maybe it’s a coincidence or maybe you specially, you did it on purpose, but I think it really fits the model of Americans who took the chance to go were not the Chevrons and the IBMs and the Microsofts, they were the John [Reuther], and me, and some of the other smaller guys. The same way when you were an immigrant coming to this country. You’re coming to this country with your knowledge, and your heart, and your desire, you’re going to make it. So, anyway, I just wanted to say that.
Daniel Satinsky: Good. I appreciate that comment, and I think it’s an important perspective for what I hope will be unique about this book. So, why don’t we start with how did you get involved and how did you decide to go to Russia?
Jeffrey Zeiger: My family, particularly my father, was in the—it’s a little bit of a long—I’m going to try to give you the cap, but it’s important for historical background.
Daniel Satinsky: Right.
Jeffrey Zeiger: My father, in the early ‘70s—1973, to be specific—was a liquor wholesaler in the state of New Jersey, and he was seeing that the whiskeys, and the bourbons, and rye, and scotch were not selling well, and he thought vodka would be the thing. And Nixon had just opened up détente. And in the liquor world everybody knew about Russian vodka, and we had no Russian vodka in the United States.
And my dad—this is how my dad thought—Holocaust survivor, came to this country, America, with nothing. Talk about immigrants, you know, 14 years old with nothing. Thought, hey, I’m going to—I speak Russian. He was born in Poland. I’m going to go to Moscow and I’m going to get the rights to Stoli vodka, and I’m going to bring it in and import it through my company. That’s how my dad thought.
Daniel Satinsky: Really?
Jeffrey Zeiger: Oh, yeah. It was not multimillion—it was not a major distributor. He was the…was probably one of the largest liquor wholesalers—liquor wholesalers, not wine—in the state of New Jersey at the time. There weren’t that many, so being one of the largest in Jersey really didn’t mean anything. And so that’s what he did. Nixon had opened up détente, and he went, got on a plane and went to Moscow.
And he met with—at that time it was Soviet Union in ’73, obviously, and they had silos. So, you had Nova Export, which dealt with all of the handicrafts and the wood things in the Soviet Union, you had Soyuzkhimexport, Union of Chemical Exports, which is where vodka was. And he met with the people from Stoli. And they said listen, you’re two weeks too late, we just signed a major deal with Pepsi-Cola, which was the famous deal of the Soviets were going to get Pepsi, the formula of the syrup, and since the Soviets didn’t want to pay in hard currency, or didn’t have the currency to pay, they paid in Stoli and the import rights. And he missed that deal by two weeks.
Daniel Satinsky: Whoa.
Jeffrey Zeiger: Now, could he have competed with Pepsi? No way. But the mere fact—and he and Don Kendall, Donald Kendall who was PepsiCo, I’m sure you know the name.
Daniel Satinsky: Yeah, I know. I heard Don Kendall tell this story.
Jeffrey Zeiger: Oh, yeah. And Don Kendall and Dad were great friends until Don passed away first, and then unfortunately Dad passed away eight years ago. But the points is other entrepreneurs would have said, or other people would have said ah, okay, I missed it. Dad said what else have you got? And they had Soviet perfume. And I remember he came home, I was seven years old, and he brought a thousand dollars’ worth of Soviet perfume and said to my mother see what you can do with this.
And so, they started in the basement of my house, and my mom didn’t have Tupperware parties, she had Soviet perfume parties and started selling, and we became an exclusive importer of Soviet perfume to the United States. And then that expanded. So, the next time he went back they said we want you to meet our colleagues at Nova Export, which has all nesting dolls and all the handicrafts, and so we became exclusive importers to the United States for the nesting dolls. I’m telling you all this because you asked how did I get there.
Daniel Satinsky: Wow.
Jeffrey Zeiger: Had a relationship with the Soviet Union from 1973. Dad was one of the founding members of the U.S.-USSR Chamber of Commerce. At that time, it was not a Chamber of Commerce, it was called United States-Soviet Union Russian Business Council. Then it became the Russian Business Council. And so, he had this idea. Dad’s idea was to bring Main Street America to Moscow. In 1989 he—in 1987, actually, he led a delegation from Trenton, the capital of New Jersey. Dad was going back four or five times a year, I mean, any time…I mean, business became business, became business, and it became, like I said, we were the exclusive importer in the United States, and we were selling to stores, so Mom would participate in the trade shows around and stuff.
Anyway, Dad had the idea of this Main Street, and so he took the mayor of Trenton, and they went to Moscow, and they met with, at that time Moscow had 32 districts, like New York had five boroughs. This was way before they put it into five sections. They had 32 little districts. One of them was called the Lenin District, which was whatever you thought of Moscow was in the Lenin District—Bolshoi Theater, the Kremlin, Lenin Museum, all of it is the Lenin District.
Daniel Satinsky: Arbat and that whole area, right?
Jeffrey Zeiger: That whole area was the Lenin District. And so, because they said—my dad wanted to be a sister city with…my dad wanted to have a relationship with Moscow. And Trenton has 85,000 people, Moscow had, like at that time, 7 million. It doesn’t work. So, they said why don’t you meet with the Lenin District, which had about 100,000 people, and so they did. And they signed the third Sister City relationship between the United States and the Soviet Union between Trenton and the Lenin District of Moscow.
Daniel Satinsky: Do you know what the other two were, just out of curiosity?
Jeffrey Zeiger: Seattle was definitely one, and they were the first with Seattle. And I believe—don’t quote me—but I want to say Phoenix, Arizona, or Tempe, somewhere in Arizona.
Daniel Satinsky: Okay. Curious.
Jeffrey Zeiger: But you can go to—the organization is still very prominent today. Sister Cities International is the name of the organization. You can go look.
So, Dad’s idea was now that we have the—so the sister city, the two mayors, they signed it, and we had the Russian mayor—because each district, at that time, it wasn’t really a mayor in the Soviet system, but it was the equivalent of a mayor. He came here to Trenton, big deal, you know, and signing the documents. And still have the picture of the four, my dad and the two mayors signing, and the translator, of course, signing the—although my dad spoke Russian—signing that. Anyway, that’s where…
So, the idea, then Dad said we’re going to expand this. It was more of a cultural exchange. Let’s exchange newspaper editors. So, the editor of Trenton Times went to Moscow for three months and then the editor of Pravda came to Trenton for three months. It was in culture, so Dad got very involved and brought the Bolshoi Ballet, Kirov Ballet to tours through the United States, all because of this Sister City relationship.
And then Dad had the idea let’s expand it to business, and Main Street. And his idea was to have like a cleaner, the dry cleaner, the gas station, nail salon and a restaurant. And therein was born the idea of a restaurant. And my background in growing up was always in hotels, restaurants from the time I was a boy, working in restaurants. So, when he got the deal done—so they picked two cafés in the Lenin District, and they were going to open this restaurant. And he came to me, and he said I’m doing this if you want to go. And I was like no, I don’t want to go.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: I’m 21 years old, I live at home, I’ve got six girlfriends, and I worked for Hyatt running a restaurant—in Princeton, by the way, the Hyatt Regency Princeton. It’s still there. I was running that restaurant from the time I was 19 years old till the time I was 21, until Dad came to me. Anyway, I went to my GM, and he said—the general manager at the Hyatt—and he said Jeff, what have you got to lose? Wherever I am with Hyatt you’ll have a job, so go, you’ve got nothing to lose. So, in May of ’89 I got on a plane. We got our joint venture registration number. 444 was the number. We were the first Soviet American joint venture restaurant.
Daniel Satinsky: Wow. And what year was that when that was signed?
Jeffrey Zeiger: ‘89. May of ’89.
Daniel Satinsky: Okay.
Jeffrey Zeiger: So, at that point I was 23 years old. I was born in ’66. Didn’t speak a word of Russian. Went over with Dad. Was met by—I was assigned a translator. And my job starting in May was to open the restaurant. Been to Moscow, never having spoken the language, never understanding anything about… So, I’m coming from running the restaurant at the Hyatt Regency Princeton. You could not be more polarizing than the Hyatt Regency Princeton. Well, I don’t want to do it—let’s do it this way. The Hyatt Regency Princeton—[distance hand gesture]—Moscow.
Daniel Satinsky: Right.
Jeffrey Zeiger: And I didn’t speak the language. And so, my first meeting—a true story—with our partner—so maybe we set it up that way. So, we were 50-50 partners, we were the first joint venture, and so we’re 50-50 partners. So, we, the American side, was made up of my father’s company, my family company, Zeiger Enterprises. And the Soviet side was the—and I’m going to say it in Russian, and then I’ll translate it— Trest stololovykh* Leninsky Raion, so the District, the Food Distribution Center for the Lenin District. And the Trest stololovykh would supply all the stolovayas in the Lenin District. There was one guy that was the head of that who didn’t know food from Adam, but he was the head of where they supplied the food. And Moscow had the same system for all 32 districts. It was called Mos Obschepit, Moscow Community Eating. I mean, I guess that’s the best way to describe that.
Daniel Satinsky: Right.
Jeffrey Zeiger: And so, Moscow Lenin District, the Lenin District Trest stolovykh was the other 50% partner. That was a 50-50. We were the first joint venture—I said we were the first restaurant to have one. We were actually the first joint venture to be 50-50 as well, no majority. And that’s back in 1989, No. 444.
The name of the joint venture was TrenMos, Trenton, Moscow, so sovmestnoe predpriyatiye, the joint venture. I’ll translate—well, you know. I don’t have to translate for you.
Daniel Satinsky: Right. You don’t need to translate for me.
Jeffrey Zeiger: TrenMos. And I didn’t speak a word, and I got there at 23, and I’m thinking okay, I’m going to line it up, I’ve got the training and translator. Big surprise. First meeting we walk into the Trest stololovykh, and there’s the director and his 30 people in the meeting and me, you know, and my translator, who I just met the day before.
Daniel Satinsky: Wow.
Jeffrey Zeiger: And so, through the translator I understood, you know, my dear, oh, you’re very young. Right away that was my first hint that being young was a disadvantage, because how can I know anything, I’m too young. Even though I may have more restaurant experience than all the 30 people that were in the room combined, how could I know anything, because I’m only 23.
Daniel Satinsky: Right.
Jeffrey Zeiger: It doesn’t make sense. And there’s funny stories that I can get into about that later on. I learned that lesson. Didn’t know it that day, but I learned it much later. So, through the translator the question is so okay, you’re here, I want you to know Trest stololovykh, you know, we are the ones that decide what restaurants get what, and we distribute, and because we are partners, and 50-50, and you’re the first American restaurant—we are the first American restaurant, you are going to get priority, so you, Jeff, you need to tell me, Nikolai, how much meat do you need? And I said what?
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: You didn’t translate that right, right? Because it’s my first day. I haven’t even seen the restaurant yet. I don’t know how many seats, I don’t know…I haven’t done any number crunching.
Daniel Satinsky: So, there was no business plan, no market research—
Jeffrey Zeiger: Dad’s idea—
Daniel Satinsky: Did anybody have a concept of who it was for, who the customers were supposed to be?
Jeffrey Zeiger: Originally it was going to be for the expat community, but the underlying mission of the restaurant was to expose Russians to American style of service and American style of food, which was totally—which I’ll get into.
And give them the opportunity, “them, “ Russians, the opportunity to experience real Americana in Moscow. That was the mission. Now, the expats would benefit because finally there would be a place to eat. When I got there in ’89 you can imagine New York City with five restaurants, good ones. That was Moscow. You had maybe five or ten restaurants in the entire city that expats—
Daniel Satinsky: Oh, I was there. I remember that the only place I could go was Levan, which was on Tverskaya.
Jeffrey Zeiger: That’s right.
Daniel Satinsky: That was the only place I—
Jeffrey Zeiger: “Praga“* was a good one. “Praga“ was not a bad one. But yes, most of those restaurants were not good. So, I said you had to translate that question wrong. There’s no way. And he said no that he asked me, he said something in Russian, and the guy’s, you know, no, you need to tell him. So, I’m saying to myself I have no idea. So, he says aha, you see, because you’re so young, you don’t know how much meat you need. He said okay, I’ll quantify it. How much meat do you need for a year? I said what was the first question? Do I need like forever? I have no idea.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: So, I’m saying to myself I’ve got to come up with an answer, right? So, I’m saying to myself all right, listen, there’s four quarters in a year, I’ll divide it by four and I’ll come up with a crazy freakin’ number, and I have no idea. So, I say you know what, I need one ton of beef for the quarter, for the first quarter. He says okay, that’s good. That’s good that I know that, that you need one ton of meat. And I said yes, and I’d like it, if possible, take the three months in a quarter, at 12 weeks I’d like the one ton to be broken up into 12 equal shipments, because you’re the director, you can control distribution, right? True story.
Looks at me with a straight face and said oh, no-no-no-no. I can’t tell you if you’re going to get the one ton on the first day of the first month or on the last day of the last month, or on the first—this is a true story—or on the first day of the second one. What I can promise you is that you’re going to get one ton sometime in that first quarter. And I said well, wait a minute, what happens if people walk in and they want some beef, and I don’t have beef? He says now you’re going to tell me how much fish do you need for a quarter. That was the way Soviet restaurants worked.
Daniel Satinsky: Wow.
Jeffrey Zeiger: I took delivery. If they had it, they had it. If they didn’t have it, they offered me something else. That was my first lesson. So, I said to myself—I’m not going to curse because I know you’re recording this—but what the…?
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: Hyatt Princeton and how much meat do I need for a quarter, right?
I say I’m leaving. I’m getting out. I said yeah, and I walk outside. My translator wanted to come. I said I need to be by myself, go away, leave me alone. And I had a pack of Marlboros in my—I don’t smoke, but I had a pack of Marlboros. And I walked out of this communist building with the bust of Lenin and the whole nine yards and go onto the street, and there was a car coming by. It wasn’t even a taxi; it was just a car. And I held up the pack of Marlboros and the guy stopped. And his name was Vladimir, Volodya, a young guy, had to be 22, 23, just like me. He became my driver for the next five years.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: That day I just said go. And he was driving, and he was trying to talk. He didn’t speak English; I didn’t speak Russian. We were just driving. I’m saying to myself okay, how do I get out of this? As he’s driving, he’s driving by this big, beautiful market, like a farmers’ market, and I said, stop. And I went out. There were vegetables, and beef, and food, and anything that I wanted. I mean, anything—it was a restauranteur’s dream there at the market. So, I get back in the car, and said hotel. So, which hotel? Okay, Belgrade. I stayed at the Belgrade II. I don’t know if you remember that.
Daniel Satinsky: Oh, I know. Yeah, I know where that was.
Jeffrey Zeiger: It was one thing better than the Belgrade I across the street. They didn’t have to, like, name it Belgrade I and II, they just could have said—it wasn’t a five-star hotel, it was a five-cockroach hotel. That’s how I rated it if people asked me. They said how many stars? They don’t have stars, just cockroaches.
And my chef was—I took a chef. I found a chef in New York City who was third generation…third born from St. Tropez, third generation French. Was a green card in the United States, but he wasn’t a US citizen. And I went back to him, and I was telling him the story about how much meat for the quarter, and he’s like Jeff, what plane are we leaving on and get the hell out. I said no-no-no, but then I found a market. And I took him the next morning. Volodya came back, the market, we went. And my chef had an orgasm. Oh, my god. So, I took $100, changed it illegally. You couldn’t convert back then.
Daniel Satinsky: Right.
Jeffrey Zeiger: Into rubles. Bought all this kind of stuff, brought it over to the restaurant. And I was so proud of myself because we’re sitting there saying okay, it costs this, how are we going to convert it? Oh, no, that’s not your job, chef, that’s mine, I’ll figure it out, run the numbers, whatever. Brought it back to the guys and give it to the director of the Trest stololovykh, and, you know, look what we found. What were you talking about meat for a ton and for the…? Every day I can…
And he looked at me and he said are you cuckoo? Do you know how much more expensive that is? Only spekulanti* goes to the market. We can’t go to the market. What do you mean we can’t go to the market? We’re going to buy more; we’re going to charge more. Listen, we…no. Well, that’s what we’re doing. And you know what? That’s what we did. For the first year my menu changed every day based on what I could buy.
Daniel Satinsky: Wow. And so, you had the chef with you.
Jeffrey Zeiger: Yeah, I brought him from New York.
Daniel Satinsky: He came from New York City, and he was—what was his background?
Jeffrey Zeiger: He was executive chef. In New York he was executive chef at Windows on the World.
Daniel Satinsky: Oh, wow.
Jeffrey Zeiger: And then he was working in a little—this is back in the ‘80s. Then he was working in this little Italian restaurant called Il Gotta Pardo on 56th, between 5th and 6th, something on 57th between 5th and 6th, something like that. And I found him, and we brought him over, and so he came with me. He didn’t speak Russian either.
Daniel Satinsky: He didn’t speak Russian, but he was up for an adventure.
Jeffrey Zeiger: He was going through a nasty divorce here. Timing in life is everything. His name was Bernard de Rodnay, and he was my savior. I could bring the whole cow, you know, a butchered cow, and he would create whatever he created.
So, I had a different menu every day based on what I could buy. Didn’t have a set menu. And then the challenges became now how do I teach the waitstaff that speak Russian. My real focus, in addition to trying to open the restaurant, was to learn Russian, and I did, in about three and a half, four months. I never went to school, so I picked it up just by picking it up. I make a lot of grammatical mistakes, but my vocabulary is huge, so I get my point across. And I write, like I can write it, and I can read it as well. But I hear it, because I never went to school. So, you know, “horosho”* is X-O, but it sounds like horror show, so I would spell it X, you know, when I wrote it, it was like a first grader writing it.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: It’s not, and myagkiy znak*, I never know where to put those. I don’t care. Anyway. But so now came the question of how to train the waitstaff, so for the first year when I didn’t have… When we opened, we were, you know, a lot of fanfare because we opened before McDonald’s. McDonald’s actually was Canadian, from the Canada branch, and they actually signed their agreement in my restaurant. The final agreement, they signed it in my restaurant. But the company I knew very well. They were there almost every day.
Daniel Satinsky: Where was your restaurant located?
Jeffrey Zeiger: The first one was on Komsomolsky Prospekt*, which was right across from the Palace of the Youth, Dvoretz Molodezhi. There was a metro also. That was the first one, and that was ’89. So, we opened in—I went there in May, we opened October of 89. It took me five months to open. And so, what I did was every day I would have the—I got a new translator because I didn’t trust the one that I had because I just didn’t… So, I picked him.
Daniel Satinsky: Right.
Jeffrey Zeiger: And I would have the translator type the words for the menu for the waitstaff, never mind for the guests. I didn’t have a menu for the guests because I couldn’t do it every day. So, the waitstaff talked to the table, and if it was a foreign table, you would have a Russian cheat sheet, which was English words with Russian letters. Phonetically it would say green salad with tomato, but it would be in Russian letters so he could read it. It would say grilled steak with French fries, but again it was Russian. So, that’s how I did it. And then it became the big problem of money, because you couldn’t convert the ruble, and nobody walked around with cash—I’m talking about foreign currency. So, we accepted credit cards. And then I needed to figure out—
Daniel Satinsky: And you were processing those through Dialog?
Jeffrey Zeiger: Yep. Peter Zrelov was a very good friend, by the way. Peter Zrelov was one of the founders of Dialog. I don’t know if you knew that. But yeah, it was through Dialog. And then it would go into the Vnesheconombank*, which was the only bank at that time, if you were doing dollars, that you could keep dollars in. And so very quickly I needed to figure this out. And I’ll never forget when I did figure it out it was like a light bulb went off, and it could accomplish the mission as well. So, the restaurant had—at that time—you may remember this, too—most restaurants had a place where foreigners could sit and a place where Russians could sit, and usually they were two separate rooms.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: And they would have one menu for the Russians, because they would pay in rubles, and you would have one menu that was different because it had things that you could pay for with credit cards. And we started out that way. And then I’m saying to myself, but this is stupid because I need rubles. I need rubles to live. Operationally I need rubles, not Jeff personally, but operationally. And to go on the street and convert every day, first of all there’s nothing to convert because we were getting paid in credit cards, so what am I converting? The money’s going electronically into a bank account.
And the mission was really to serve Russians, and really to expose them to what Western restaurant was, an American restaurant. And we had tablecloths. It was red, white and blue. I had, you know, and steak that was on a grill. It was apple pie. It wasn’t boiled meat. And we had some Russian dishes, too, but the majority, of course, were American style—baked potato, French fries, steak, chops, fish, salads, pasta. We’ll get to that.
But it hit me like a light bulb: I need to figure out and base my ruble pricing the way that I would do it in America. So, if I go to the market every day and I’m buying a pound of meat—let’s just use meat again—I’m buying a pound of meat, and it’s going to take, I don’t know, ten rubles, how many portions can I get out of the pound that I buy, divide that, that’s my cost of the meat. Now I add on the vegetables, and I add on the labor, and I get a selling point. If I run my restaurant as a ruble operation with the profit margins that I would run in the United States, I’m going to generate rubles, and I need to generate rubles by selling to Russians. I need ruble cash.
Every day I needed cash. Every day because I needed to go the market. I wasn’t getting a bill. Like in Princeton I would call, the guy would bring, I’d sign the bill, and the accounting department, who I didn’t even know, would pay the bill 30 days later. I’m paying cash every day, right, so I need the cash. And then if I priced to my foreign guests, if I priced my restaurant like a mid-level restaurant per purchase I can’t convert, right, so I’m buying the same pound of meat in the market, right, but it’s a ruble price. If I spend time trying to convert that into zolotoi ruble, golden ruble, no. It’s $35 for a steak, whatever, $25 for a steak, $20 for a fish, it’s profit because I’m covering my operating costs by selling to Russians.
Even that was way too big for a one-volume book, so I've pretty much cut oil and gas out of the picture, and I've cut out a lot of the sort of natural resource sector, to focus really on the sectors of the Russian economy that were non-existent in Soviet times and developed a lot with input from foreigners—Americans in particular. So, you know, real estate, finance, restaurants, media, telecom—these were areas which, you know, if they were there, they were underdeveloped in Soviet times.
And so, that's where I’ve focused. As of now, I've done probably over 105–106 interviews with different people to cover those segments of the economy. I have a contract with Routledge, the UK publisher, to publish the book, and I'm supposed to submit the manuscript in June. So, I'm working away at it and trying to fill holes in areas that I don't know very much about, or which I think were sort of seminal kinds of companies, if you will. I was lucky to get to John [Reuther] and, you know, hear his stories. He likes to tell stories—he's a good storyteller.
Jeffrey Zeiger: He's a great storyteller. I just spent some time with John down in Naples, as a matter of fact. I just came back.
Daniel Satinsky: Oh, okay, cool. I don't know, you know, what he said about our interview, but I enjoyed it.
Jeffrey Zeiger: Spoke very favorably. I told him our conversation was happening, and he said you’re very easy to talk to, and… Well, like you said, he’s a good storyteller, but he thoroughly enjoyed it, and I thanked him, and I’m going to thank you for even wanting to hear the story. And one of the things that interested me just now was when you cut out oil and gas and those kinds of guys, I knew all of them, because they all came to my restaurant, but that was really…the bigger companies is really not the story, because the bigger companies had the resources, they had the relationships. It didn’t matter who was in the Kremlin. You know, Chevron and all those guys, ExxonMobil—it was Exxon back then.
Daniel Satinsky: Right.
Jeffrey Zeiger: But those guys were there, and it was not as ballsy a decision for them to be the representative of Chevron, or IBM, or Microsoft, Pan Am, even, at the time. That was the airline at the time. Ballsy because they got hardship pay because Moscow was not Paris. That’s where the ballsiness, I think, ended because it was such a different level. So, I’m glad to hear, to be honest, that you are focusing on more of the entrepreneurial guys that did it on their own, which coincides with what the Russian economy—and Soviet at that time—really needed and didn’t have. They had oil and gas, they had diamonds, they had the natural resources. They didn’t have telecom. They didn’t have real estate. The government owned everything. They didn’t have what you and I know as restaurants. They had cafeterias that were horrible.
Daniel Satinsky: Stolovaya*.
Jeffrey Zeiger: Stolovaya, exactly. So, I think that that’s a really…maybe it’s a coincidence or maybe you specially, you did it on purpose, but I think it really fits the model of Americans who took the chance to go were not the Chevrons and the IBMs and the Microsofts, they were the John [Reuther], and me, and some of the other smaller guys. The same way when you were an immigrant coming to this country. You’re coming to this country with your knowledge, and your heart, and your desire, you’re going to make it. So, anyway, I just wanted to say that.
Daniel Satinsky: Good. I appreciate that comment, and I think it’s an important perspective for what I hope will be unique about this book. So, why don’t we start with how did you get involved and how did you decide to go to Russia?
Jeffrey Zeiger: My family, particularly my father, was in the—it’s a little bit of a long—I’m going to try to give you the cap, but it’s important for historical background.
Daniel Satinsky: Right.
Jeffrey Zeiger: My father, in the early ‘70s—1973, to be specific—was a liquor wholesaler in the state of New Jersey, and he was seeing that the whiskeys, and the bourbons, and rye, and scotch were not selling well, and he thought vodka would be the thing. And Nixon had just opened up détente. And in the liquor world everybody knew about Russian vodka, and we had no Russian vodka in the United States.
And my dad—this is how my dad thought—Holocaust survivor, came to this country, America, with nothing. Talk about immigrants, you know, 14 years old with nothing. Thought, hey, I’m going to—I speak Russian. He was born in Poland. I’m going to go to Moscow and I’m going to get the rights to Stoli vodka, and I’m going to bring it in and import it through my company. That’s how my dad thought.
Daniel Satinsky: Really?
Jeffrey Zeiger: Oh, yeah. It was not multimillion—it was not a major distributor. He was the…was probably one of the largest liquor wholesalers—liquor wholesalers, not wine—in the state of New Jersey at the time. There weren’t that many, so being one of the largest in Jersey really didn’t mean anything. And so that’s what he did. Nixon had opened up détente, and he went, got on a plane and went to Moscow.
And he met with—at that time it was Soviet Union in ’73, obviously, and they had silos. So, you had Nova Export, which dealt with all of the handicrafts and the wood things in the Soviet Union, you had Soyuzkhimexport, Union of Chemical Exports, which is where vodka was. And he met with the people from Stoli. And they said listen, you’re two weeks too late, we just signed a major deal with Pepsi-Cola, which was the famous deal of the Soviets were going to get Pepsi, the formula of the syrup, and since the Soviets didn’t want to pay in hard currency, or didn’t have the currency to pay, they paid in Stoli and the import rights. And he missed that deal by two weeks.
Daniel Satinsky: Whoa.
Jeffrey Zeiger: Now, could he have competed with Pepsi? No way. But the mere fact—and he and Don Kendall, Donald Kendall who was PepsiCo, I’m sure you know the name.
Daniel Satinsky: Yeah, I know. I heard Don Kendall tell this story.
Jeffrey Zeiger: Oh, yeah. And Don Kendall and Dad were great friends until Don passed away first, and then unfortunately Dad passed away eight years ago. But the points is other entrepreneurs would have said, or other people would have said ah, okay, I missed it. Dad said what else have you got? And they had Soviet perfume. And I remember he came home, I was seven years old, and he brought a thousand dollars’ worth of Soviet perfume and said to my mother see what you can do with this.
And so, they started in the basement of my house, and my mom didn’t have Tupperware parties, she had Soviet perfume parties and started selling, and we became an exclusive importer of Soviet perfume to the United States. And then that expanded. So, the next time he went back they said we want you to meet our colleagues at Nova Export, which has all nesting dolls and all the handicrafts, and so we became exclusive importers to the United States for the nesting dolls. I’m telling you all this because you asked how did I get there.
Daniel Satinsky: Wow.
Jeffrey Zeiger: Had a relationship with the Soviet Union from 1973. Dad was one of the founding members of the U.S.-USSR Chamber of Commerce. At that time, it was not a Chamber of Commerce, it was called United States-Soviet Union Russian Business Council. Then it became the Russian Business Council. And so, he had this idea. Dad’s idea was to bring Main Street America to Moscow. In 1989 he—in 1987, actually, he led a delegation from Trenton, the capital of New Jersey. Dad was going back four or five times a year, I mean, any time…I mean, business became business, became business, and it became, like I said, we were the exclusive importer in the United States, and we were selling to stores, so Mom would participate in the trade shows around and stuff.
Anyway, Dad had the idea of this Main Street, and so he took the mayor of Trenton, and they went to Moscow, and they met with, at that time Moscow had 32 districts, like New York had five boroughs. This was way before they put it into five sections. They had 32 little districts. One of them was called the Lenin District, which was whatever you thought of Moscow was in the Lenin District—Bolshoi Theater, the Kremlin, Lenin Museum, all of it is the Lenin District.
Daniel Satinsky: Arbat and that whole area, right?
Jeffrey Zeiger: That whole area was the Lenin District. And so, because they said—my dad wanted to be a sister city with…my dad wanted to have a relationship with Moscow. And Trenton has 85,000 people, Moscow had, like at that time, 7 million. It doesn’t work. So, they said why don’t you meet with the Lenin District, which had about 100,000 people, and so they did. And they signed the third Sister City relationship between the United States and the Soviet Union between Trenton and the Lenin District of Moscow.
Daniel Satinsky: Do you know what the other two were, just out of curiosity?
Jeffrey Zeiger: Seattle was definitely one, and they were the first with Seattle. And I believe—don’t quote me—but I want to say Phoenix, Arizona, or Tempe, somewhere in Arizona.
Daniel Satinsky: Okay. Curious.
Jeffrey Zeiger: But you can go to—the organization is still very prominent today. Sister Cities International is the name of the organization. You can go look.
So, Dad’s idea was now that we have the—so the sister city, the two mayors, they signed it, and we had the Russian mayor—because each district, at that time, it wasn’t really a mayor in the Soviet system, but it was the equivalent of a mayor. He came here to Trenton, big deal, you know, and signing the documents. And still have the picture of the four, my dad and the two mayors signing, and the translator, of course, signing the—although my dad spoke Russian—signing that. Anyway, that’s where…
So, the idea, then Dad said we’re going to expand this. It was more of a cultural exchange. Let’s exchange newspaper editors. So, the editor of Trenton Times went to Moscow for three months and then the editor of Pravda came to Trenton for three months. It was in culture, so Dad got very involved and brought the Bolshoi Ballet, Kirov Ballet to tours through the United States, all because of this Sister City relationship.
And then Dad had the idea let’s expand it to business, and Main Street. And his idea was to have like a cleaner, the dry cleaner, the gas station, nail salon and a restaurant. And therein was born the idea of a restaurant. And my background in growing up was always in hotels, restaurants from the time I was a boy, working in restaurants. So, when he got the deal done—so they picked two cafés in the Lenin District, and they were going to open this restaurant. And he came to me, and he said I’m doing this if you want to go. And I was like no, I don’t want to go.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: I’m 21 years old, I live at home, I’ve got six girlfriends, and I worked for Hyatt running a restaurant—in Princeton, by the way, the Hyatt Regency Princeton. It’s still there. I was running that restaurant from the time I was 19 years old till the time I was 21, until Dad came to me. Anyway, I went to my GM, and he said—the general manager at the Hyatt—and he said Jeff, what have you got to lose? Wherever I am with Hyatt you’ll have a job, so go, you’ve got nothing to lose. So, in May of ’89 I got on a plane. We got our joint venture registration number. 444 was the number. We were the first Soviet American joint venture restaurant.
Daniel Satinsky: Wow. And what year was that when that was signed?
Jeffrey Zeiger: ‘89. May of ’89.
Daniel Satinsky: Okay.
Jeffrey Zeiger: So, at that point I was 23 years old. I was born in ’66. Didn’t speak a word of Russian. Went over with Dad. Was met by—I was assigned a translator. And my job starting in May was to open the restaurant. Been to Moscow, never having spoken the language, never understanding anything about… So, I’m coming from running the restaurant at the Hyatt Regency Princeton. You could not be more polarizing than the Hyatt Regency Princeton. Well, I don’t want to do it—let’s do it this way. The Hyatt Regency Princeton—[distance hand gesture]—Moscow.
Daniel Satinsky: Right.
Jeffrey Zeiger: And I didn’t speak the language. And so, my first meeting—a true story—with our partner—so maybe we set it up that way. So, we were 50-50 partners, we were the first joint venture, and so we’re 50-50 partners. So, we, the American side, was made up of my father’s company, my family company, Zeiger Enterprises. And the Soviet side was the—and I’m going to say it in Russian, and then I’ll translate it— Trest stololovykh* Leninsky Raion, so the District, the Food Distribution Center for the Lenin District. And the Trest stololovykh would supply all the stolovayas in the Lenin District. There was one guy that was the head of that who didn’t know food from Adam, but he was the head of where they supplied the food. And Moscow had the same system for all 32 districts. It was called Mos Obschepit, Moscow Community Eating. I mean, I guess that’s the best way to describe that.
Daniel Satinsky: Right.
Jeffrey Zeiger: And so, Moscow Lenin District, the Lenin District Trest stolovykh was the other 50% partner. That was a 50-50. We were the first joint venture—I said we were the first restaurant to have one. We were actually the first joint venture to be 50-50 as well, no majority. And that’s back in 1989, No. 444.
The name of the joint venture was TrenMos, Trenton, Moscow, so sovmestnoe predpriyatiye, the joint venture. I’ll translate—well, you know. I don’t have to translate for you.
Daniel Satinsky: Right. You don’t need to translate for me.
Jeffrey Zeiger: TrenMos. And I didn’t speak a word, and I got there at 23, and I’m thinking okay, I’m going to line it up, I’ve got the training and translator. Big surprise. First meeting we walk into the Trest stololovykh, and there’s the director and his 30 people in the meeting and me, you know, and my translator, who I just met the day before.
Daniel Satinsky: Wow.
Jeffrey Zeiger: And so, through the translator I understood, you know, my dear, oh, you’re very young. Right away that was my first hint that being young was a disadvantage, because how can I know anything, I’m too young. Even though I may have more restaurant experience than all the 30 people that were in the room combined, how could I know anything, because I’m only 23.
Daniel Satinsky: Right.
Jeffrey Zeiger: It doesn’t make sense. And there’s funny stories that I can get into about that later on. I learned that lesson. Didn’t know it that day, but I learned it much later. So, through the translator the question is so okay, you’re here, I want you to know Trest stololovykh, you know, we are the ones that decide what restaurants get what, and we distribute, and because we are partners, and 50-50, and you’re the first American restaurant—we are the first American restaurant, you are going to get priority, so you, Jeff, you need to tell me, Nikolai, how much meat do you need? And I said what?
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: You didn’t translate that right, right? Because it’s my first day. I haven’t even seen the restaurant yet. I don’t know how many seats, I don’t know…I haven’t done any number crunching.
Daniel Satinsky: So, there was no business plan, no market research—
Jeffrey Zeiger: Dad’s idea—
Daniel Satinsky: Did anybody have a concept of who it was for, who the customers were supposed to be?
Jeffrey Zeiger: Originally it was going to be for the expat community, but the underlying mission of the restaurant was to expose Russians to American style of service and American style of food, which was totally—which I’ll get into.
And give them the opportunity, “them, “ Russians, the opportunity to experience real Americana in Moscow. That was the mission. Now, the expats would benefit because finally there would be a place to eat. When I got there in ’89 you can imagine New York City with five restaurants, good ones. That was Moscow. You had maybe five or ten restaurants in the entire city that expats—
Daniel Satinsky: Oh, I was there. I remember that the only place I could go was Levan, which was on Tverskaya.
Jeffrey Zeiger: That’s right.
Daniel Satinsky: That was the only place I—
Jeffrey Zeiger: “Praga“* was a good one. “Praga“ was not a bad one. But yes, most of those restaurants were not good. So, I said you had to translate that question wrong. There’s no way. And he said no that he asked me, he said something in Russian, and the guy’s, you know, no, you need to tell him. So, I’m saying to myself I have no idea. So, he says aha, you see, because you’re so young, you don’t know how much meat you need. He said okay, I’ll quantify it. How much meat do you need for a year? I said what was the first question? Do I need like forever? I have no idea.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: So, I’m saying to myself I’ve got to come up with an answer, right? So, I’m saying to myself all right, listen, there’s four quarters in a year, I’ll divide it by four and I’ll come up with a crazy freakin’ number, and I have no idea. So, I say you know what, I need one ton of beef for the quarter, for the first quarter. He says okay, that’s good. That’s good that I know that, that you need one ton of meat. And I said yes, and I’d like it, if possible, take the three months in a quarter, at 12 weeks I’d like the one ton to be broken up into 12 equal shipments, because you’re the director, you can control distribution, right? True story.
Looks at me with a straight face and said oh, no-no-no-no. I can’t tell you if you’re going to get the one ton on the first day of the first month or on the last day of the last month, or on the first—this is a true story—or on the first day of the second one. What I can promise you is that you’re going to get one ton sometime in that first quarter. And I said well, wait a minute, what happens if people walk in and they want some beef, and I don’t have beef? He says now you’re going to tell me how much fish do you need for a quarter. That was the way Soviet restaurants worked.
Daniel Satinsky: Wow.
Jeffrey Zeiger: I took delivery. If they had it, they had it. If they didn’t have it, they offered me something else. That was my first lesson. So, I said to myself—I’m not going to curse because I know you’re recording this—but what the…?
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: Hyatt Princeton and how much meat do I need for a quarter, right?
I say I’m leaving. I’m getting out. I said yeah, and I walk outside. My translator wanted to come. I said I need to be by myself, go away, leave me alone. And I had a pack of Marlboros in my—I don’t smoke, but I had a pack of Marlboros. And I walked out of this communist building with the bust of Lenin and the whole nine yards and go onto the street, and there was a car coming by. It wasn’t even a taxi; it was just a car. And I held up the pack of Marlboros and the guy stopped. And his name was Vladimir, Volodya, a young guy, had to be 22, 23, just like me. He became my driver for the next five years.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: That day I just said go. And he was driving, and he was trying to talk. He didn’t speak English; I didn’t speak Russian. We were just driving. I’m saying to myself okay, how do I get out of this? As he’s driving, he’s driving by this big, beautiful market, like a farmers’ market, and I said, stop. And I went out. There were vegetables, and beef, and food, and anything that I wanted. I mean, anything—it was a restauranteur’s dream there at the market. So, I get back in the car, and said hotel. So, which hotel? Okay, Belgrade. I stayed at the Belgrade II. I don’t know if you remember that.
Daniel Satinsky: Oh, I know. Yeah, I know where that was.
Jeffrey Zeiger: It was one thing better than the Belgrade I across the street. They didn’t have to, like, name it Belgrade I and II, they just could have said—it wasn’t a five-star hotel, it was a five-cockroach hotel. That’s how I rated it if people asked me. They said how many stars? They don’t have stars, just cockroaches.
And my chef was—I took a chef. I found a chef in New York City who was third generation…third born from St. Tropez, third generation French. Was a green card in the United States, but he wasn’t a US citizen. And I went back to him, and I was telling him the story about how much meat for the quarter, and he’s like Jeff, what plane are we leaving on and get the hell out. I said no-no-no, but then I found a market. And I took him the next morning. Volodya came back, the market, we went. And my chef had an orgasm. Oh, my god. So, I took $100, changed it illegally. You couldn’t convert back then.
Daniel Satinsky: Right.
Jeffrey Zeiger: Into rubles. Bought all this kind of stuff, brought it over to the restaurant. And I was so proud of myself because we’re sitting there saying okay, it costs this, how are we going to convert it? Oh, no, that’s not your job, chef, that’s mine, I’ll figure it out, run the numbers, whatever. Brought it back to the guys and give it to the director of the Trest stololovykh, and, you know, look what we found. What were you talking about meat for a ton and for the…? Every day I can…
And he looked at me and he said are you cuckoo? Do you know how much more expensive that is? Only spekulanti* goes to the market. We can’t go to the market. What do you mean we can’t go to the market? We’re going to buy more; we’re going to charge more. Listen, we…no. Well, that’s what we’re doing. And you know what? That’s what we did. For the first year my menu changed every day based on what I could buy.
Daniel Satinsky: Wow. And so, you had the chef with you.
Jeffrey Zeiger: Yeah, I brought him from New York.
Daniel Satinsky: He came from New York City, and he was—what was his background?
Jeffrey Zeiger: He was executive chef. In New York he was executive chef at Windows on the World.
Daniel Satinsky: Oh, wow.
Jeffrey Zeiger: And then he was working in a little—this is back in the ‘80s. Then he was working in this little Italian restaurant called Il Gotta Pardo on 56th, between 5th and 6th, something on 57th between 5th and 6th, something like that. And I found him, and we brought him over, and so he came with me. He didn’t speak Russian either.
Daniel Satinsky: He didn’t speak Russian, but he was up for an adventure.
Jeffrey Zeiger: He was going through a nasty divorce here. Timing in life is everything. His name was Bernard de Rodnay, and he was my savior. I could bring the whole cow, you know, a butchered cow, and he would create whatever he created.
So, I had a different menu every day based on what I could buy. Didn’t have a set menu. And then the challenges became now how do I teach the waitstaff that speak Russian. My real focus, in addition to trying to open the restaurant, was to learn Russian, and I did, in about three and a half, four months. I never went to school, so I picked it up just by picking it up. I make a lot of grammatical mistakes, but my vocabulary is huge, so I get my point across. And I write, like I can write it, and I can read it as well. But I hear it, because I never went to school. So, you know, “horosho”* is X-O, but it sounds like horror show, so I would spell it X, you know, when I wrote it, it was like a first grader writing it.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: It’s not, and myagkiy znak*, I never know where to put those. I don’t care. Anyway. But so now came the question of how to train the waitstaff, so for the first year when I didn’t have… When we opened, we were, you know, a lot of fanfare because we opened before McDonald’s. McDonald’s actually was Canadian, from the Canada branch, and they actually signed their agreement in my restaurant. The final agreement, they signed it in my restaurant. But the company I knew very well. They were there almost every day.
Daniel Satinsky: Where was your restaurant located?
Jeffrey Zeiger: The first one was on Komsomolsky Prospekt*, which was right across from the Palace of the Youth, Dvoretz Molodezhi. There was a metro also. That was the first one, and that was ’89. So, we opened in—I went there in May, we opened October of 89. It took me five months to open. And so, what I did was every day I would have the—I got a new translator because I didn’t trust the one that I had because I just didn’t… So, I picked him.
Daniel Satinsky: Right.
Jeffrey Zeiger: And I would have the translator type the words for the menu for the waitstaff, never mind for the guests. I didn’t have a menu for the guests because I couldn’t do it every day. So, the waitstaff talked to the table, and if it was a foreign table, you would have a Russian cheat sheet, which was English words with Russian letters. Phonetically it would say green salad with tomato, but it would be in Russian letters so he could read it. It would say grilled steak with French fries, but again it was Russian. So, that’s how I did it. And then it became the big problem of money, because you couldn’t convert the ruble, and nobody walked around with cash—I’m talking about foreign currency. So, we accepted credit cards. And then I needed to figure out—
Daniel Satinsky: And you were processing those through Dialog?
Jeffrey Zeiger: Yep. Peter Zrelov was a very good friend, by the way. Peter Zrelov was one of the founders of Dialog. I don’t know if you knew that. But yeah, it was through Dialog. And then it would go into the Vnesheconombank*, which was the only bank at that time, if you were doing dollars, that you could keep dollars in. And so very quickly I needed to figure this out. And I’ll never forget when I did figure it out it was like a light bulb went off, and it could accomplish the mission as well. So, the restaurant had—at that time—you may remember this, too—most restaurants had a place where foreigners could sit and a place where Russians could sit, and usually they were two separate rooms.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: And they would have one menu for the Russians, because they would pay in rubles, and you would have one menu that was different because it had things that you could pay for with credit cards. And we started out that way. And then I’m saying to myself, but this is stupid because I need rubles. I need rubles to live. Operationally I need rubles, not Jeff personally, but operationally. And to go on the street and convert every day, first of all there’s nothing to convert because we were getting paid in credit cards, so what am I converting? The money’s going electronically into a bank account.
And the mission was really to serve Russians, and really to expose them to what Western restaurant was, an American restaurant. And we had tablecloths. It was red, white and blue. I had, you know, and steak that was on a grill. It was apple pie. It wasn’t boiled meat. And we had some Russian dishes, too, but the majority, of course, were American style—baked potato, French fries, steak, chops, fish, salads, pasta. We’ll get to that.
But it hit me like a light bulb: I need to figure out and base my ruble pricing the way that I would do it in America. So, if I go to the market every day and I’m buying a pound of meat—let’s just use meat again—I’m buying a pound of meat, and it’s going to take, I don’t know, ten rubles, how many portions can I get out of the pound that I buy, divide that, that’s my cost of the meat. Now I add on the vegetables, and I add on the labor, and I get a selling point. If I run my restaurant as a ruble operation with the profit margins that I would run in the United States, I’m going to generate rubles, and I need to generate rubles by selling to Russians. I need ruble cash.
Every day I needed cash. Every day because I needed to go the market. I wasn’t getting a bill. Like in Princeton I would call, the guy would bring, I’d sign the bill, and the accounting department, who I didn’t even know, would pay the bill 30 days later. I’m paying cash every day, right, so I need the cash. And then if I priced to my foreign guests, if I priced my restaurant like a mid-level restaurant per purchase I can’t convert, right, so I’m buying the same pound of meat in the market, right, but it’s a ruble price. If I spend time trying to convert that into zolotoi ruble, golden ruble, no. It’s $35 for a steak, whatever, $25 for a steak, $20 for a fish, it’s profit because I’m covering my operating costs by selling to Russians.
Daniel Satinsky: With your rubles, right.
Jeffrey Zeiger: And the light bulb went like that. And then I can go even one step further. Because I’m taking that same meat, and that same vegetable, and that same fruit, and I’m selling it at such a high profit margin to foreigners because there’s no cost then, I can take the bottle of Chivas that most Russians didn’t every drink, because they didn’t have hard currency, because I’ll let you buy the Chivas in hard currency, and I can sell it for rubles. I can go back the other way. Expensive. Expensive, but if you had the money in your pocket, you could have a shot of Chivas. If you had the rubles in your pocket.
And my restaurant then became the special occasion restaurant. If you’re celebrating your birthday, if you’re celebrating an anniversary, if you’re celebrating something, or you just want a high-end restaurant because you feel like it. Like you and I, I would use the same analogy as like if I was going to go to Windows on the World. I wouldn’t go there every day. But if I had a special occasion, and I was in New York, guess what? I’ll eat there. Or if I’m going to go to any one of the other famous restaurants. That’s what my restaurant was like for Russians. It’s going to cost you. It’s probably going to cost you half your month’s pay, maybe even your month’s pay.
No one is going to say you’re going to sit in a different room. I had two rooms. I put everybody together. So, Russians were in one room and… Russians and Americans in both, or foreigners in both rooms. And I had a two week wait. By February—well, when McDonald’s opened in—February 1, 1990, McDonald’s opened. By the time McDonald’s opened, I was running a two and a half, three week wait on the ruble side, and I would be running a two to three hour wait every night on the foreign side.
And then I wanted to really create an atmosphere of Americana, so I brought in a piano player, and I would have him sitting in the middle of the restaurant. And he was just…and I found him. He was my piano player my whole time there. He would just play Broadway, and Sinatra, you know, in the background. Just to go into an American—
Daniel Satinsky: Right, I was going to ask you that because Russian restaurants always had these entertainment programs, and you didn’t do that.
Jeffrey Zeiger: No.
Daniel Satinsky: But you had this guy playing like a piano bar, kind of.
Jeffrey Zeiger: Like a piano bar concept, exactly. A funny story that I’m going to tell you in a second, but before I do that, to me it was I’m creating this atmosphere that people are going to think about food and service. You know, changing the ash tray. You could smoke back then. Russian waiters didn’t know how to change an ash tray. Taught them how to do that. Serve ladies first. Why? Because you do. There’s no other reason. Take the order from the ladies first. Why? Because you do. And so, it was…
And by the time I got to February or March of ’90 I didn’t need a translator anymore for my dialogue with the waiters and cooks. The translator was doing more things, translating menus and things like that. And I began to speak, and I began to get very involved in Chambers of Commerce and Russia Business Council and all those kinds of things. And anybody who was anybody came to my restaurant, anybody who was anybody on both sides. On the Russian side and… And I remember Robert Strauss, bless his soul, the ambassador, he brought in the guys from Pan Am, IBM, Microsoft. He just became ambassador, and he brought in all the Fortune 500 companies to have a dinner in my restaurant.
Daniel Satinsky: Wow.
Jeffrey Zeiger: And he had been there like three days before or four days before, and he was from Texas, and I had Texas chili on the menu. Really? This ain’t no Texas chili. Like, you know, boy, get out of here. But anyway, he loved the concept, and he asked me a very simple question: how are you making money? And I told him the story. He says reserve a table for 10 for three days from now, I have a dinner with—it was supposed to be at Spaso House. I’m bringing everybody here because they need to hear this, because they’re not doing that. They’re thinking dollars. They’re not thinking rubles. And I’ve said we’ve got to think—dollars I can stay in the United States. And I had everybody—Pan Am, Microsoft. And he had me come and tell what I did and how I did it.
And the next thing I know I’m busy as hell from that because all the time they were coming out to dinner, guess what, Jeff? And that was very important because in Moscow they didn’t have a face of a restaurant. I was the face of the restaurant. People walked in—and one last marketing thing I did. I would fly back on Pan Am, back and forth. It was the only direct flight. And Pan Am had three flights at that time a week. One would come in on Sunday and they would stay till Friday. Friday would be in and out, Saturday would be in and out, and then the new one coming in on Sunday would stay till Friday. So, I’m flying back one time and again, didn’t go to school—well, I went to high school, but didn’t really go to school—the school of life. Gorgeous flight attendants, right? I mean, I’m 23, and so I’m looking, right?
Where do you guys eat, I asked them. Ah, that’s our biggest problem, especially on the five-day layover. We bring cans of tuna, and we have crackers. No-no-no. Here’s my card. I have an idea. You 12—12 for the 747—flight attendants, three pilots, you know, pilot, co-pilot, engineer. You 15 come to my restaurant tonight and I have an idea. So, they came to the restaurant, and I said here’s the gig. I will let you, Pan Am, any employee of Pan Am pay me in rubles. Pay me in rubles. I didn’t let any foreigners pay me in rubles because that’s not fair. On the black market you go out and get 12, 15 rubles to the dollar, you could have a decent meal in my restaurant for seven bucks. And for a Russian, 84 to 100 rubles back in the early ’90s—
Daniel Satinsky: Was a lot of money, yeah.
Jeffrey Zeiger: That’s half a month’s pay, if not more, right, so you can’t do that. But I’m going to allow you, Pan Am, to do that. You’re not going to tell anyone. You’re going to let your Russian boyfriend or whatever you have here pay for it, so the Russians are paying. But here’s the gig. When people ask you where do you eat when you’re flying over here, guess what restaurant we’re going to? Here are 500 of my cards.
Daniel Satinsky: Whoa.
Jeffrey Zeiger: You put your name—give it out to all the flight attendants, you put your name on the back of the card and you give the card to the businessman and say hey, Pam sent me or Jean sent me, or Mary sent me, and that way I’ll know that it’s coming from Pan Am. That was one of the key secrets of my restaurant becoming busy with the expats.
And every night, you think about it—and again, I’m not stupid. I put the 15 people in the middle of the restaurant—beautiful American—well, many Russians because they had local people that they would buy things, sell things, bring things, whatever. Fifteen beautiful people in the center of the restaurant every night. Other people would know them because they came over on the plane, right?
But that was the—I never really had to do marketing or take ads out or do anything, because that was my marketing. And it all came from me sitting on the plane looking at this gorgeous flight attendant. I wanted her to come to the restaurant.
Daniel Satinsky: In those years how many…what would you estimate was the size of the expat community that you were servicing there?
Jeffrey Zeiger: Well, when I say expat, I mean total foreign.
Daniel Satinsky: Yeah, total foreigners.
Jeffrey Zeiger: That I was serving or that lived in Moscow?
Daniel Satinsky: That lived in Moscow. Were there 10,000, 50?
Jeffrey Zeiger: I would say it would be closer between 20 and 25.
Daniel Satinsky: 20 and 25 thousand?
Jeffrey Zeiger: Yeah. If you add in the embassies, don’t forget the embassies.
Daniel Satinsky: Ah, that’s true.
Jeffrey Zeiger: All the staff of the embassies.
And then as things changed into the early ‘90s, and you had Yeltsin come into power, and you had this… You know, when I opened in ’89 it was the height of perestroika and glasnost, right? I mean, that’s the height in the ‘80s, ’89, ’90. But then when Yeltsin came and all these other things started happening—you know, I’m not going down the political road because that’s a whole separate conversation in itself—but as this era of monetizing, privatization, we became the first joint venture, by the way, to privatize. So, instead of being 50-50 with the government we became 60% went to us and 40% went to a company formed by my employees. That happened in 1991. We were the first joint venture to do that.
They actually bought the capital out of the Trest stolovykh. We bought 10% to give us 60. And they couldn’t raise the money for—we were willing to be 50-50, but they couldn’t raise the money. We bought the 10 and they bought 40, and so it was a 60-40, so when we split profit—and every month we split profit—ruble profit, dollar profit. The employees got their 40% share and divvied it up however was their—
Daniel Satinsky: They must be happy as pigs in sh.. in those days, right?
Jeffrey Zeiger: And they were loyal as hell to me because they knew where it—us because they knew where it came from. And people always asked me before we did that what was it like transferring money out of the Soviet Union. It wasn’t hard at all because the government was the partner. So, when we split profit every month, you know, at the beginning there wasn’t much profit. But we got up to two and then my third restaurant, I mean, we were throwing out a decent amount of money every month, and it was all through Vnesheconombank, all transferred back to the United States. Paid taxes on it there and here. There was no… The only problem I had with Vnesheconombank is one time they froze not just my account, they froze all the accounts, like in ’91, if you remember that. And I lost about a quarter of a million dollars at that time. And it went somewhere. I don’t think anybody knows.
But you know like I really think that guys like me—and John [Reuther] was one of them—that were working every day with Russians, like I could not avoid working—my Russian partner, my Soviet partner, who was the man that signed the thing with Dad in America, he had no idea what capitalism was. He had no idea what profit was. What he knew was that he was a director, and directors have certain privileges. And that leads in—and I hope it’s okay I’m just telling you stories because—
Daniel Satinsky: Yeah, absolutely. I’ll interrupt you if I have a question.
Daniel Satinsky: Okay, good, good. So, again, this goes back to the lesson I learned on my first day, right? I’m young. I was 23, 24, 25 those years. He was 58, 59, 60. Never been in a restaurant a day in his life except to drink vodka, that’s it. Couldn’t… But we came to an understanding. I think this was the secret of our success. He knew the Soviet system way better than I did. I knew the restaurant system way better than he did. I was the face in the front. He worked the mechanisms in the back, meaning sourcing of food, maintaining the trucks that would go out every day, employee issues, all the things that were Soviet or Russian, him. All the things that were Western—service, whatever—me. And yet we still…until we found out that that was the best mechanism for the entire joint venture there were times where we bumped heads.
And the most familiar time was when you’re a director of something, you have privileges, and I didn’t know that. And so, we’re in the restaurant business, so he expects to have a director’s table all the time, whether he uses it or not. I did not know that. It’s a busy restaurant, and I set the table. I had no idea that he had said that it was the director’s table. And he comes with no call at 6:30 one night, and we’ve got a two hour wait with foreigners, and his table, there’s people sitting at his table. Well, you would have thought that I started World War III. Who am I to, you know, you don’t respect me, I’m a director. And I’m saying to myself—and this was where the conflict was—I’m sitting that table three, four times tonight. We’re both going to make money. But it’s your table. So, I’m sitting going… Now he’s getting on the phone, he’s calling my dad in the United States.
Daniel Satinsky: Whoa.
Jeffrey Zeiger: Help me. And my dad’s trying to explain to him that it’s not respect, he didn’t know, talk to Jeff, you’ll figure it out. Here’s what we’re going to do. This table will be yours, and I’ll put your name on it. If you don’t call me by 6:00 in the evening, it’s mine. You tell me at 5:45 you’re coming, I won’t sit anybody there the whole night. But you tell me. It’s money for you and me, I’m sitting. He says I don’t know, I’ve got to think about it. So, he had to think about it over a bottle of vodka. And of course, at the end of a bottle of vodka he agreed that we would have, you know.
And that was the lesson of—and my point I was trying to make is guys like John, guys like me, we had to be in the trenches and work those things out because the guys from Chevron and the guys from—and I’m not criticizing the guys from Chevron, and Mobil, and IBM and all those guys, because they did a hell of a job in what they did, too. But they didn’t have that. They were far removed from that. They were dealing with translators, or strategy five, six years out.
I’m dealing with how to make a living today. I’m dealing with the same issues that I had in running a restaurant over there I would have had over here, except throw in the director’s table, throw in distribution, throw in language barrier. But I had to deal with people, right? But at the end, when he got that ruble profit every month, and he got that dollar profit every month, you know, maybe this young punk knows what he’s doing, because he wouldn’t have made that as mayor. He wouldn’t have made that in his career working in communist—
Daniel Satinsky: Yeah, no, that was the whole point of that change, right?
Jeffrey Zeiger: Yeah.
Daniel Satinsky: Well, let me ask you a related question, which is the krysha* question. Was the fact that he was your partner mean that you didn’t have to deal with krysha?
Jeffrey Zeiger: No. The reason I didn’t have to deal with the krysha is because, again, call it luck, call it fate, call it just what you do in the restaurant business, I come from the old school. I worked every table. Every table I was at. If it was a foreign table I spoke English, if it was a Russian table, I spoke Russian. And what I did was, people would invite me to sit down. You’re the owner? Yeah. Foreigners and Russians. I’m not talking… I would sit down. I would have a drink. Did I know who I was having a drink with? No. Did other people know who I was having a drink? Apparently so.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: And apparently everybody thought that I was spoken for. True story.
Daniel Satinsky: Really?
Jeffrey Zeiger: And part of the reason why everybody thought I was spoken for is the walls in my restaurant were red, white and blue wallpaper, really tacky. And on one trip home I came home, and we had a new governor—yeah, a new governor, Governor Florio, elected in ’88 after Governor Tom Kean. And I had a, you know, Dad was close to all the governors because our offices were in Trenton, but him and Jim Florio, for whatever reason—and Dad was a Republican. It doesn’t matter, but Florio was a Democrat. It doesn’t matter. Florio wrote this wonderful letter and gave a flag and asked that it be put up, because we were from New Jersey, right?
So, I had a big aerial view of the city of Trenton—the name of the restaurant is TrenMos, right? And I had this like Jersey corner. So, I had the aerial thing of Trenton so I could tell Russians this is Trenton, it’s a capital, blah-blah-blah. And I put up the flag of Jersey with the letter from Governor Florio congratulating, you know. The next night people from Pennsylvania come in and say how come you don’t have a Pennsylvania flag?
Well, write your governor. True story. How come you don’t have a Vermont flag? Write your governor. Wound up getting all 50 flags.
And then I started getting country flags. Because I had a lot of ambassadors that would come in. So, why can’t I have my flag? You can. Write me a letter. You’ll come, we’ll take a picture of you, and we put the flag up, and you pick the spot, I don’t care. It was great PR, right?
Daniel Satinsky: Right.
Jeffrey Zeiger: Why’d I tell you that story? 1991 Georgia, Republic, not the state, got their independence. Gamsakhurdia, remember?
Daniel Satinsky: I remember Gamsakhurdia, yeah.
Jeffrey Zeiger: Guy showed up and they wanted to bring a Georgian flag. What am I going to say, no? I welcomed everybody else. And it just so happened I had a spot on the wall next to the flag of Georgia in the United States. And it was in the corner. And it was a round table. That became the Georgian corner. Who sat at that table? And I’m not being dumb here; I’m not trying to be sarcastic. I have no idea. All I knew is these guys were good customers, they came in, never bothered me, never…they ate, they paid. They said can we bring you the flag? Sure, you can bring me the flag.
They would bring guests in. Apparently, they were bringing in some pretty heavy hitters. And they would see me—hey, Jeff, come on, this is so-and-so. And he’s so happy, and you do it, you are incredible, you put this flag in your restaurant. Why wouldn’t I? It’s a symbol of freedom, right? Your country, our country, wonderful, Georgia, American Georgia, whatever. I was operating my restaurant, doing what I was doing. And maybe that’s why I was never…
When my partner—and it’s public knowledge, and I’m sure you know about him, and if you don’t I’m going to tell you anyway—my partner was shot for something that he did outside of the restaurant.
Daniel Satinsky: Which was?
Jeffrey Zeiger: Which partner or what he…?
Daniel Satinsky: Oh, this was Paul Tatum.
Jeffrey Zeiger: No, Paul—Paul Tatum and I were good friends. He came through. That was Slavanskaya Hotel, the Radisson Hotel. He’d walk in the restaurant; he drank Diet Coke all the time. Didn’t take a drink. I don’t know, he didn’t trust people. He thought people would put something in the drink. He’d open the Diet Coke. But unfortunately, he lost his life. No, I had a Russian partner. The man that signed the document. When the ruble crashed there was a moment there where you could exchange old rubles for new rubles, if you remember.
Well, he, my partner, being that he made a lot of money in rubles every month because of the restaurant, had a lot of old rubles. So, he made a deal with one group at one rate of exchange, apparently, and then he made a deal—for his personal money, not for the restaurant. The restaurant money was no problem because I didn’t have any rubles to hold. I was burning through rubles every day. But then he made a deal with another group for a different rate, and the first group didn’t like that, so they took him out.
Daniel Satinsky: Wow.
Jeffrey Zeiger: And after they took him out—and this is, Leslie Stahl, I mean, I was on 60 Minutes, I was on CNN. All those guys were in my restaurant all the time. I knew them all. In fact, CBS used to come to my restaurant, ABC, NBC. I had the first—telecom, you’re talking about telecom, you could dial a local number from my restaurant phone, a Moscow number, and you’d get a Pittsburgh operator, AT&T. I had a lot of Americans come to the restaurant—I did that as a promo, and I had a lot of Americans come into the bar to make phone calls home.
Daniel Satinsky: So, you did that through Sovam Teleport?
Jeffrey Zeiger: Exactly.
Daniel Satinsky: Yeah. So, I interviewed him, too.
Jeffrey Zeiger: Good, good. And Stan Cramton, does that name mean anything to you?
Daniel Satinsky: I remember the name, but I didn’t track him down.
Jeffrey Zeiger: I could hook you up with him. I speak to Stan quite often. He’s down in Bonita Springs, right outside of Naples.
Daniel Satinsky: That would be fantastic. I talked to Joel Schatz founded—
Jeffrey Zeiger: That name I don’t know. Stan and I go way back.
Daniel Satinsky: I think he founded it and then as soon as the Soviet Union dissolved, he was out of it, he didn’t operate it. So, if Stan was the operator, I would love to talk to him.
Jeffrey Zeiger: I don’t know if he was the operator of that one, but I know that U.S. West and some of those other telecoms, that was Stan. I know he was talking about cell phone technology way back in the ‘90s, ’91, ’92. That was Stan. So, I don’t know, but I have no problem in doing an intro.
Daniel Satinsky: That would be fantastic. I would love it.
Jeffrey Zeiger: I made a note. And so right after that was the first time anybody ever came to me and oh, so you’re not protected. Nobody ever asked. They said yes, you are. I said no, I’m not. Here are the keys. Transfer X and I’m gone. I’m not working for you. I’m not, you know. The funny, the sad—well, funny part, sad part—I was really trying to figure out a way to leave anyway, because I had met my wife. She was a former ballerina in the Bolshoi. And used to do Bolshoi Ballet and follow up receptions at my restaurant for the expats.
Jeffrey Zeiger: And the light bulb went like that. And then I can go even one step further. Because I’m taking that same meat, and that same vegetable, and that same fruit, and I’m selling it at such a high profit margin to foreigners because there’s no cost then, I can take the bottle of Chivas that most Russians didn’t every drink, because they didn’t have hard currency, because I’ll let you buy the Chivas in hard currency, and I can sell it for rubles. I can go back the other way. Expensive. Expensive, but if you had the money in your pocket, you could have a shot of Chivas. If you had the rubles in your pocket.
And my restaurant then became the special occasion restaurant. If you’re celebrating your birthday, if you’re celebrating an anniversary, if you’re celebrating something, or you just want a high-end restaurant because you feel like it. Like you and I, I would use the same analogy as like if I was going to go to Windows on the World. I wouldn’t go there every day. But if I had a special occasion, and I was in New York, guess what? I’ll eat there. Or if I’m going to go to any one of the other famous restaurants. That’s what my restaurant was like for Russians. It’s going to cost you. It’s probably going to cost you half your month’s pay, maybe even your month’s pay.
No one is going to say you’re going to sit in a different room. I had two rooms. I put everybody together. So, Russians were in one room and… Russians and Americans in both, or foreigners in both rooms. And I had a two week wait. By February—well, when McDonald’s opened in—February 1, 1990, McDonald’s opened. By the time McDonald’s opened, I was running a two and a half, three week wait on the ruble side, and I would be running a two to three hour wait every night on the foreign side.
And then I wanted to really create an atmosphere of Americana, so I brought in a piano player, and I would have him sitting in the middle of the restaurant. And he was just…and I found him. He was my piano player my whole time there. He would just play Broadway, and Sinatra, you know, in the background. Just to go into an American—
Daniel Satinsky: Right, I was going to ask you that because Russian restaurants always had these entertainment programs, and you didn’t do that.
Jeffrey Zeiger: No.
Daniel Satinsky: But you had this guy playing like a piano bar, kind of.
Jeffrey Zeiger: Like a piano bar concept, exactly. A funny story that I’m going to tell you in a second, but before I do that, to me it was I’m creating this atmosphere that people are going to think about food and service. You know, changing the ash tray. You could smoke back then. Russian waiters didn’t know how to change an ash tray. Taught them how to do that. Serve ladies first. Why? Because you do. There’s no other reason. Take the order from the ladies first. Why? Because you do. And so, it was…
And by the time I got to February or March of ’90 I didn’t need a translator anymore for my dialogue with the waiters and cooks. The translator was doing more things, translating menus and things like that. And I began to speak, and I began to get very involved in Chambers of Commerce and Russia Business Council and all those kinds of things. And anybody who was anybody came to my restaurant, anybody who was anybody on both sides. On the Russian side and… And I remember Robert Strauss, bless his soul, the ambassador, he brought in the guys from Pan Am, IBM, Microsoft. He just became ambassador, and he brought in all the Fortune 500 companies to have a dinner in my restaurant.
Daniel Satinsky: Wow.
Jeffrey Zeiger: And he had been there like three days before or four days before, and he was from Texas, and I had Texas chili on the menu. Really? This ain’t no Texas chili. Like, you know, boy, get out of here. But anyway, he loved the concept, and he asked me a very simple question: how are you making money? And I told him the story. He says reserve a table for 10 for three days from now, I have a dinner with—it was supposed to be at Spaso House. I’m bringing everybody here because they need to hear this, because they’re not doing that. They’re thinking dollars. They’re not thinking rubles. And I’ve said we’ve got to think—dollars I can stay in the United States. And I had everybody—Pan Am, Microsoft. And he had me come and tell what I did and how I did it.
And the next thing I know I’m busy as hell from that because all the time they were coming out to dinner, guess what, Jeff? And that was very important because in Moscow they didn’t have a face of a restaurant. I was the face of the restaurant. People walked in—and one last marketing thing I did. I would fly back on Pan Am, back and forth. It was the only direct flight. And Pan Am had three flights at that time a week. One would come in on Sunday and they would stay till Friday. Friday would be in and out, Saturday would be in and out, and then the new one coming in on Sunday would stay till Friday. So, I’m flying back one time and again, didn’t go to school—well, I went to high school, but didn’t really go to school—the school of life. Gorgeous flight attendants, right? I mean, I’m 23, and so I’m looking, right?
Where do you guys eat, I asked them. Ah, that’s our biggest problem, especially on the five-day layover. We bring cans of tuna, and we have crackers. No-no-no. Here’s my card. I have an idea. You 12—12 for the 747—flight attendants, three pilots, you know, pilot, co-pilot, engineer. You 15 come to my restaurant tonight and I have an idea. So, they came to the restaurant, and I said here’s the gig. I will let you, Pan Am, any employee of Pan Am pay me in rubles. Pay me in rubles. I didn’t let any foreigners pay me in rubles because that’s not fair. On the black market you go out and get 12, 15 rubles to the dollar, you could have a decent meal in my restaurant for seven bucks. And for a Russian, 84 to 100 rubles back in the early ’90s—
Daniel Satinsky: Was a lot of money, yeah.
Jeffrey Zeiger: That’s half a month’s pay, if not more, right, so you can’t do that. But I’m going to allow you, Pan Am, to do that. You’re not going to tell anyone. You’re going to let your Russian boyfriend or whatever you have here pay for it, so the Russians are paying. But here’s the gig. When people ask you where do you eat when you’re flying over here, guess what restaurant we’re going to? Here are 500 of my cards.
Daniel Satinsky: Whoa.
Jeffrey Zeiger: You put your name—give it out to all the flight attendants, you put your name on the back of the card and you give the card to the businessman and say hey, Pam sent me or Jean sent me, or Mary sent me, and that way I’ll know that it’s coming from Pan Am. That was one of the key secrets of my restaurant becoming busy with the expats.
And every night, you think about it—and again, I’m not stupid. I put the 15 people in the middle of the restaurant—beautiful American—well, many Russians because they had local people that they would buy things, sell things, bring things, whatever. Fifteen beautiful people in the center of the restaurant every night. Other people would know them because they came over on the plane, right?
But that was the—I never really had to do marketing or take ads out or do anything, because that was my marketing. And it all came from me sitting on the plane looking at this gorgeous flight attendant. I wanted her to come to the restaurant.
Daniel Satinsky: In those years how many…what would you estimate was the size of the expat community that you were servicing there?
Jeffrey Zeiger: Well, when I say expat, I mean total foreign.
Daniel Satinsky: Yeah, total foreigners.
Jeffrey Zeiger: That I was serving or that lived in Moscow?
Daniel Satinsky: That lived in Moscow. Were there 10,000, 50?
Jeffrey Zeiger: I would say it would be closer between 20 and 25.
Daniel Satinsky: 20 and 25 thousand?
Jeffrey Zeiger: Yeah. If you add in the embassies, don’t forget the embassies.
Daniel Satinsky: Ah, that’s true.
Jeffrey Zeiger: All the staff of the embassies.
And then as things changed into the early ‘90s, and you had Yeltsin come into power, and you had this… You know, when I opened in ’89 it was the height of perestroika and glasnost, right? I mean, that’s the height in the ‘80s, ’89, ’90. But then when Yeltsin came and all these other things started happening—you know, I’m not going down the political road because that’s a whole separate conversation in itself—but as this era of monetizing, privatization, we became the first joint venture, by the way, to privatize. So, instead of being 50-50 with the government we became 60% went to us and 40% went to a company formed by my employees. That happened in 1991. We were the first joint venture to do that.
They actually bought the capital out of the Trest stolovykh. We bought 10% to give us 60. And they couldn’t raise the money for—we were willing to be 50-50, but they couldn’t raise the money. We bought the 10 and they bought 40, and so it was a 60-40, so when we split profit—and every month we split profit—ruble profit, dollar profit. The employees got their 40% share and divvied it up however was their—
Daniel Satinsky: They must be happy as pigs in sh.. in those days, right?
Jeffrey Zeiger: And they were loyal as hell to me because they knew where it—us because they knew where it came from. And people always asked me before we did that what was it like transferring money out of the Soviet Union. It wasn’t hard at all because the government was the partner. So, when we split profit every month, you know, at the beginning there wasn’t much profit. But we got up to two and then my third restaurant, I mean, we were throwing out a decent amount of money every month, and it was all through Vnesheconombank, all transferred back to the United States. Paid taxes on it there and here. There was no… The only problem I had with Vnesheconombank is one time they froze not just my account, they froze all the accounts, like in ’91, if you remember that. And I lost about a quarter of a million dollars at that time. And it went somewhere. I don’t think anybody knows.
But you know like I really think that guys like me—and John [Reuther] was one of them—that were working every day with Russians, like I could not avoid working—my Russian partner, my Soviet partner, who was the man that signed the thing with Dad in America, he had no idea what capitalism was. He had no idea what profit was. What he knew was that he was a director, and directors have certain privileges. And that leads in—and I hope it’s okay I’m just telling you stories because—
Daniel Satinsky: Yeah, absolutely. I’ll interrupt you if I have a question.
Daniel Satinsky: Okay, good, good. So, again, this goes back to the lesson I learned on my first day, right? I’m young. I was 23, 24, 25 those years. He was 58, 59, 60. Never been in a restaurant a day in his life except to drink vodka, that’s it. Couldn’t… But we came to an understanding. I think this was the secret of our success. He knew the Soviet system way better than I did. I knew the restaurant system way better than he did. I was the face in the front. He worked the mechanisms in the back, meaning sourcing of food, maintaining the trucks that would go out every day, employee issues, all the things that were Soviet or Russian, him. All the things that were Western—service, whatever—me. And yet we still…until we found out that that was the best mechanism for the entire joint venture there were times where we bumped heads.
And the most familiar time was when you’re a director of something, you have privileges, and I didn’t know that. And so, we’re in the restaurant business, so he expects to have a director’s table all the time, whether he uses it or not. I did not know that. It’s a busy restaurant, and I set the table. I had no idea that he had said that it was the director’s table. And he comes with no call at 6:30 one night, and we’ve got a two hour wait with foreigners, and his table, there’s people sitting at his table. Well, you would have thought that I started World War III. Who am I to, you know, you don’t respect me, I’m a director. And I’m saying to myself—and this was where the conflict was—I’m sitting that table three, four times tonight. We’re both going to make money. But it’s your table. So, I’m sitting going… Now he’s getting on the phone, he’s calling my dad in the United States.
Daniel Satinsky: Whoa.
Jeffrey Zeiger: Help me. And my dad’s trying to explain to him that it’s not respect, he didn’t know, talk to Jeff, you’ll figure it out. Here’s what we’re going to do. This table will be yours, and I’ll put your name on it. If you don’t call me by 6:00 in the evening, it’s mine. You tell me at 5:45 you’re coming, I won’t sit anybody there the whole night. But you tell me. It’s money for you and me, I’m sitting. He says I don’t know, I’ve got to think about it. So, he had to think about it over a bottle of vodka. And of course, at the end of a bottle of vodka he agreed that we would have, you know.
And that was the lesson of—and my point I was trying to make is guys like John, guys like me, we had to be in the trenches and work those things out because the guys from Chevron and the guys from—and I’m not criticizing the guys from Chevron, and Mobil, and IBM and all those guys, because they did a hell of a job in what they did, too. But they didn’t have that. They were far removed from that. They were dealing with translators, or strategy five, six years out.
I’m dealing with how to make a living today. I’m dealing with the same issues that I had in running a restaurant over there I would have had over here, except throw in the director’s table, throw in distribution, throw in language barrier. But I had to deal with people, right? But at the end, when he got that ruble profit every month, and he got that dollar profit every month, you know, maybe this young punk knows what he’s doing, because he wouldn’t have made that as mayor. He wouldn’t have made that in his career working in communist—
Daniel Satinsky: Yeah, no, that was the whole point of that change, right?
Jeffrey Zeiger: Yeah.
Daniel Satinsky: Well, let me ask you a related question, which is the krysha* question. Was the fact that he was your partner mean that you didn’t have to deal with krysha?
Jeffrey Zeiger: No. The reason I didn’t have to deal with the krysha is because, again, call it luck, call it fate, call it just what you do in the restaurant business, I come from the old school. I worked every table. Every table I was at. If it was a foreign table I spoke English, if it was a Russian table, I spoke Russian. And what I did was, people would invite me to sit down. You’re the owner? Yeah. Foreigners and Russians. I’m not talking… I would sit down. I would have a drink. Did I know who I was having a drink with? No. Did other people know who I was having a drink? Apparently so.
Daniel Satinsky: [Laughs.]
Jeffrey Zeiger: And apparently everybody thought that I was spoken for. True story.
Daniel Satinsky: Really?
Jeffrey Zeiger: And part of the reason why everybody thought I was spoken for is the walls in my restaurant were red, white and blue wallpaper, really tacky. And on one trip home I came home, and we had a new governor—yeah, a new governor, Governor Florio, elected in ’88 after Governor Tom Kean. And I had a, you know, Dad was close to all the governors because our offices were in Trenton, but him and Jim Florio, for whatever reason—and Dad was a Republican. It doesn’t matter, but Florio was a Democrat. It doesn’t matter. Florio wrote this wonderful letter and gave a flag and asked that it be put up, because we were from New Jersey, right?
So, I had a big aerial view of the city of Trenton—the name of the restaurant is TrenMos, right? And I had this like Jersey corner. So, I had the aerial thing of Trenton so I could tell Russians this is Trenton, it’s a capital, blah-blah-blah. And I put up the flag of Jersey with the letter from Governor Florio congratulating, you know. The next night people from Pennsylvania come in and say how come you don’t have a Pennsylvania flag?
Well, write your governor. True story. How come you don’t have a Vermont flag? Write your governor. Wound up getting all 50 flags.
And then I started getting country flags. Because I had a lot of ambassadors that would come in. So, why can’t I have my flag? You can. Write me a letter. You’ll come, we’ll take a picture of you, and we put the flag up, and you pick the spot, I don’t care. It was great PR, right?
Daniel Satinsky: Right.
Jeffrey Zeiger: Why’d I tell you that story? 1991 Georgia, Republic, not the state, got their independence. Gamsakhurdia, remember?
Daniel Satinsky: I remember Gamsakhurdia, yeah.
Jeffrey Zeiger: Guy showed up and they wanted to bring a Georgian flag. What am I going to say, no? I welcomed everybody else. And it just so happened I had a spot on the wall next to the flag of Georgia in the United States. And it was in the corner. And it was a round table. That became the Georgian corner. Who sat at that table? And I’m not being dumb here; I’m not trying to be sarcastic. I have no idea. All I knew is these guys were good customers, they came in, never bothered me, never…they ate, they paid. They said can we bring you the flag? Sure, you can bring me the flag.
They would bring guests in. Apparently, they were bringing in some pretty heavy hitters. And they would see me—hey, Jeff, come on, this is so-and-so. And he’s so happy, and you do it, you are incredible, you put this flag in your restaurant. Why wouldn’t I? It’s a symbol of freedom, right? Your country, our country, wonderful, Georgia, American Georgia, whatever. I was operating my restaurant, doing what I was doing. And maybe that’s why I was never…
When my partner—and it’s public knowledge, and I’m sure you know about him, and if you don’t I’m going to tell you anyway—my partner was shot for something that he did outside of the restaurant.
Daniel Satinsky: Which was?
Jeffrey Zeiger: Which partner or what he…?
Daniel Satinsky: Oh, this was Paul Tatum.
Jeffrey Zeiger: No, Paul—Paul Tatum and I were good friends. He came through. That was Slavanskaya Hotel, the Radisson Hotel. He’d walk in the restaurant; he drank Diet Coke all the time. Didn’t take a drink. I don’t know, he didn’t trust people. He thought people would put something in the drink. He’d open the Diet Coke. But unfortunately, he lost his life. No, I had a Russian partner. The man that signed the document. When the ruble crashed there was a moment there where you could exchange old rubles for new rubles, if you remember.
Well, he, my partner, being that he made a lot of money in rubles every month because of the restaurant, had a lot of old rubles. So, he made a deal with one group at one rate of exchange, apparently, and then he made a deal—for his personal money, not for the restaurant. The restaurant money was no problem because I didn’t have any rubles to hold. I was burning through rubles every day. But then he made a deal with another group for a different rate, and the first group didn’t like that, so they took him out.
Daniel Satinsky: Wow.
Jeffrey Zeiger: And after they took him out—and this is, Leslie Stahl, I mean, I was on 60 Minutes, I was on CNN. All those guys were in my restaurant all the time. I knew them all. In fact, CBS used to come to my restaurant, ABC, NBC. I had the first—telecom, you’re talking about telecom, you could dial a local number from my restaurant phone, a Moscow number, and you’d get a Pittsburgh operator, AT&T. I had a lot of Americans come to the restaurant—I did that as a promo, and I had a lot of Americans come into the bar to make phone calls home.
Daniel Satinsky: So, you did that through Sovam Teleport?
Jeffrey Zeiger: Exactly.
Daniel Satinsky: Yeah. So, I interviewed him, too.
Jeffrey Zeiger: Good, good. And Stan Cramton, does that name mean anything to you?
Daniel Satinsky: I remember the name, but I didn’t track him down.
Jeffrey Zeiger: I could hook you up with him. I speak to Stan quite often. He’s down in Bonita Springs, right outside of Naples.
Daniel Satinsky: That would be fantastic. I talked to Joel Schatz founded—
Jeffrey Zeiger: That name I don’t know. Stan and I go way back.
Daniel Satinsky: I think he founded it and then as soon as the Soviet Union dissolved, he was out of it, he didn’t operate it. So, if Stan was the operator, I would love to talk to him.
Jeffrey Zeiger: I don’t know if he was the operator of that one, but I know that U.S. West and some of those other telecoms, that was Stan. I know he was talking about cell phone technology way back in the ‘90s, ’91, ’92. That was Stan. So, I don’t know, but I have no problem in doing an intro.
Daniel Satinsky: That would be fantastic. I would love it.
Jeffrey Zeiger: I made a note. And so right after that was the first time anybody ever came to me and oh, so you’re not protected. Nobody ever asked. They said yes, you are. I said no, I’m not. Here are the keys. Transfer X and I’m gone. I’m not working for you. I’m not, you know. The funny, the sad—well, funny part, sad part—I was really trying to figure out a way to leave anyway, because I had met my wife. She was a former ballerina in the Bolshoi. And used to do Bolshoi Ballet and follow up receptions at my restaurant for the expats.
But anyway, and I wanted to leave because the train ride was over. I could tell the times were changing. This is ’94, ’95. So, now the boys are becoming a little bit more aggressive in all spheres of business, not just the restaurant, but they’re all…you know, now they’re all over us, now they’re like us in the ’50s, you know. Now they’re coming out and it’s time to…time to know when to get off the train.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: It’s been a good ride. I made a lot of money, met my wife, yeah. So, I wound up, they wound up sending pennies on the dollar, and they wound up with restaurants that lasted maybe another six months after I left.
Daniel Satinsky: And these were people who came to you and said listen, now I know you didn’t have a…no krysha, if you don’t have one, I’m your krysha—
Jeffrey Zeiger: Yeah, yeah.
Daniel Satinsky: Okay.
Jeffrey Zeiger: I said no, you’re not. I said no, you’re not. The only bright spot in the whole thing is the guy that started out peeling potatoes and carrots—they used to go through 500 pounds of apples a week for my apple pie. I hired a kid who today is the No. 1 restauranteur in Moscow.
Daniel Satinsky: What’s his name?
Jeffrey Zeiger: Arkady Novikov. And he’s got the chain of restaurants; he’s got all the famous ones like Syr* and Vanil. Vanil, he opened—Vanilla—in my old bistro where he used to peel potatoes. Oktoberfest, he opened. I mean, this is going back now. And he’s still there. He’s in his—I would say he’s probably in his mid 40s. So, that’s a good takeaway story.
But yeah, they sent pennies on the dollar, I got on a plane, brought my wife here. I have two beautiful daughters, beautiful family. No regrets except for the fact that I really think that if I had…it’s a double-edged sword because if I had…I could have expanded TrenMos into the entire Russian Federation, and probably every republic I could have had a TrenMos. But I didn’t…I was 23 and to me it was more important that the salt and pepper shakers were full on every table, and the service was going to be the same every night, and that I would be there to meet my guests.
And I’m not saying one’s right and one’s wrong. We made a lot of money, and we did well. Could it have been better financially? Probably a lot better. But we did very well, and I’m here, and I’m very happy telling you the story. And we set a trend. You look at Moscow today, and I can’t take all the credit, but I certainly can take the credit of bringing foreign restaurants into Moscow. You look at Moscow today with 15, 20,000 restaurants from all over the world. You can be in downtown Moscow and not even realize you’re in Moscow from the culinary perspective.
Daniel Satinsky: Yeah, absolutely. And so, were there a number of people who came through your restaurant who then went on in the industry, to seed the industry, so to speak?
Jeffrey Zeiger: I know that part of our big thing the chef and I would always talk about would be training. And so, I know that some of my maître d’s are still working today in restaurants because my wife goes back. She has family and friends there. And she runs into them in restaurants, and they recognize her. The back of the house I kind of lost track because I lost track of where they would be. But like I said, the biggest standout to me is Arkady Novikov. But that was part of the mission, too, was to train these people so that they could be involved in the restaurant or at least have an understanding of hospitality.
But look what happened, I mean, the Ritz-Carlton, Hyatt, Marriott, all of those hotel chains that would never even think of going there, wouldn’t have been there. Now it’s like Moscow came on the radar. And I’m not saying it’s because of me. I’m not saying that. I’m saying I think people like me, and John, and Stan, and some of the other people you’re interviewing kind of pushed the issue of foreign—again, not oil and gas because, you know, not really thought of as being…like you said, things that were not part of the Russian or Soviet economy—hotels, hospitality, real estate—that was never common. And now they are.
Daniel Satinsky: Yeah. And now they are, yeah. And in a certain sense it seems to me, and part of the thesis that I’ve come to from listening to any number of people, is that they knew what they didn’t know at the time. They knew they needed foreign expertise, they got it, and over the course of a decade, or in some cases less, a lot of people, they sent kids abroad, they learned from the foreigners, and there was less need for foreigners. By the early 2000s they didn’t need to pay the hazard pay. And they absorbed so much from that decade that it transformed the country in really noticeable ways, I mean, you know. So, there was less of a—
Jeffrey Zeiger: I would just add one thing to that, which is even on top of that—I agree with everything that you said. I would just add that in some cases they even became employers of foreigners.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: And I think that’s the true, you know, full circle effect, as my dad would like to say, you know. That’s the full circle. So, we came in, we were the employers, we taught, we partnered, we learned together, different cultures, different whatever. And then at the end of, the top of the circle coming back, now you are hiring foreigners to work for you in your country.
That’s where a guy like Novikov is the full circle. That’s what he’s doing. And there are a lot of examples, I’m sure, in other industries like them. And I think your point is right on. And I think, but I do think that some of the best years of our relationships, “our” mean the countries’ relationships, when people worked together. And that was my dad’s philosophy. It’s harder—to get to understand somebody and understand their culture, the Russian people are the warmest people on the planet. Governments may be fakakta, a Yiddish word, may be—
Daniel Satinsky: Yeah, I know that word.
Jeffrey Zeiger: Good. But the people? They are more like Americans than any European country. They are more like—
Daniel Satinsky: Absolutely.
Jeffrey Zeiger: —values, education, religion, all of those things that we hold so precious, they’re right there, if not, in some cases, even more. There was always this government-to-government thing. You get down and you go into a Russian house, or a Russian apartment and you have dinner, or you go into a Georgian, you know, I’ve been to Georgia many times, Tbilisi and Sukhumi and all those, the hospitality and the genuineness of those people—you don’t get that unless you live it, breathe it and work with it. You don’t get that. And I think that helped our countries. And now you have the polarization again. Think about it. You have this polarization again, you have the ideology coming out again, you have the lack of cooperation coming out again, and what is the result? Tension. And again, not to get political with you, but I think the two go hand-in-hand.
Daniel Satinsky: Yeah, I agree with you. And the lack of actual contact between ordinary people, it’s so striking between that time and this time.
Jeffrey Zeiger: One hundred percent.
Daniel Satinsky: Enormously different. So, that’s part of the agenda of this book, is to talk about that. This is, you know, a period of time when there was the only and the most interaction between Americans and Russians in history were in those years. I mean, day-to-day interaction.
Jeffrey Zeiger: Day-to-day, day-to-day. There are times in history, very interestingly, and not a lot of people know this, where Russia and America were actually very friendly to each other. Abraham Lincoln and the czar communicated many times in very deep, thoughtful letters during the slavery, during the emancipation and things like that, and Russia helped tremendously, the Soviet Union, in other times, and we’ve helped them.
But to your point, ingraining yourself in the community or in each other’s culture was never as strong as it was, I would say, from the mid ’80s up until 2000. I think that was the real time of it, something like that. Only those that were there. Only those that were there know that and feel that.
Daniel Satinsky: Yeah. Well, I know it and feel it, so… And am trying to convey it, and your words will help me.
Jeffrey Zeiger: Thank you. And hats off to you. And any way that I can help, any way that, you know, any other people that I can think of. And Stan I’ll do the intro. I’ll introduce you. And he’s a great guy. He’s got a lot of stories, too, because he was involved…he really was an entrepreneur, and I was more on the people level with the restaurant ops. They were in the ministerial and those kinds of levels because it was telecom and those kinds of things, so there may be a whole different perspective.
Daniel Satinsky: Sure. I think I may have met him once or twice at the U.S.-Russia Business Council or something.
Jeffrey Zeiger: He was all over that.
Daniel Satinsky: I’m sure he wouldn’t remember me, but I do remember the name, so it would be great if I could talk to him. So, I want to ask you one last question, and I think you probably are ready to get going, but…
Jeffrey Zeiger: Well, I appreciate your time, too.
Daniel Satinsky: So, when the guy says to you, you know, if you don’t have krysha, I’m your partner, and you walked away from it, were you bitter? Did you come home and say those da-da-da’s and, you know? Did you feel bitter or taken advantage of?
Jeffrey Zeiger: No. And I think there are at least two, maybe three reasons. First and foremost, I’d already begun the process in my mind of thinking how do I have my child—my wife, as I mentioned, it was at that time, the end of ’94, was pregnant, and I didn’t want my child, my first child, any child, to be born there.
So, already thinking about not to leave—I mean, the ideal world at that time would have been to come here and have the baby and then kind of go back and forth and maybe expand. But those were the long gut entrepreneurial answers, right? Okay, still I’m 25, 27, that’s what I want to do. Reality was setting in, as I mentioned, that the landscape was changing. It was becoming harder and harder to do business in an American style, Western style way. And that’s not the krysha issue, the Mafia issue. That’s also they were going through. “They,” the Russians were going through turmoil and hell from an economic point of view, a currency point of view, from an understanding of the change of socialism to quasi whatever you want to call it ism.
And third, and probably most important, besides the baby, it wasn’t…the competition was getting better, and I didn’t have the funds to compete against the Marriotts and the Radissons and the European restaurants, and the European money that was flooding in there because they were seeing the results. Again, I’m in the restaurant world, but even across the spectrum of business. Businesses were saying hey, we can make money here, we can do things here. All of a sudden you have the—so as more and more people came their expectations also came with that. So, you had more guys coming with more fancier and better restaurants, and hotels, and all those things.
So, in my world it wasn’t Moscow with ten restaurants anymore. Maybe it was Moscow with 200. The extra 200 restaurants were high-end restaurants, stealing away my thunder that I had that I was so much better than everybody else. Now there are guys that are really much better than me. Because we were operation bootstrap. I mean, it was me, me and my dad. It wasn’t a back of the house, accounting, and HR, and money to spend on design and the layouts. We just did it. I’m not complaining.
So, you said was I bitter. I think it was almost like, in Yiddish there’s also another word called beshert, meant to be. Maybe it was meant to be that the timing of my partner being killed, my wife pregnant with my first child, and the landscape in my world, restaurant world, really significantly changed to where maybe it’s meant to be that I go—that’s how I thought at that time, and I still think.
And I still think that way today because no point in being bitter. I did well, took the best thing out of Russia, which is my wife. And would I do it again? In a heartbeat. I’d do it a little different. Maybe I’d have ten restaurants instead of three, but I would do it again, for sure.
Daniel Satinsky: Do you have any kind of newspaper article or reference to your partner’s being killed?
Jeffrey Zeiger: Oh, if you look up…I’ll put in the chat his last name. It was covered by—because we were the first American restaurant. His name was Sergei Goryachev. It was 1992, 1993.
Daniel Satinsky: Okay, all right.
Jeffrey Zeiger: I mean, everybody—CNN, Wall Street Journal, New York Times. They were all friends of mine. I knew them all. But you’d find it. If I could make a request—
Daniel Satinsky: Yeah.
Jeffrey Zeiger: In your book, when people ask me about Sergei and what happened, it is part of my history, and I shared it with you, so I don’t… But the concern is that—and I’m not saying you’re going to do this—but if you can find a way to put it in there where it doesn’t become the focal point.
Daniel Satinsky: Yeah, I know what you mean.
Jeffrey Zeiger: You know what I mean? Because I don’t want people to think that he was a bad guy, No. 1. I don’t want people to think that he, you know, maybe, you know, that he was with the Mafia the whole time and I didn’t know. I have a very good—I had a good relationship, and I still remember him fondly. And he made a mistake. He made a very costly mistake. A mistake of greed. And maybe that greed was because in his whole life leading up to it, he was working in a system that didn’t allow for capitalism and things like that. Now, that’s a whole different issue.
But I guess if I’m thinking about how an outsider would read it, and they read this story about this wonderful experience, what these people did, and they brought this to that, and they brought restaurants not only financial success, but culinary, and people enjoyed it, it was the restaurant to go to for your special occasion, and then they read that the guy got killed, that kind of takes all the air out of the balloon, so—
Daniel Satinsky: It does, it does.
Jeffrey Zeiger: I’m not trying to tell you how to write it.
Daniel Satinsky: Yeah, no, I know what you’re saying. And I’m trying to—I actually, it’s a dilemma for me because the stereotypes of the time were, you know, the Wild East, lawlessness, Mafia, all the stereotypes about Russian people, which I’m trying to avoid, and which I argued against my whole life, that that’s all people knew about, was that, and they didn’t know anything else. So, I can’t ignore it, but I don’t want to sensationalize it.
Jeffrey Zeiger: Well, yeah. And one thing that may make it better, or easier, is that the amount of time from the time he was killed, which was ’92, ’93, I operated till the end of ’94 before I was approached.
So, I always tell people if there were…if that killing triggered something, or we were already in with something, there would have been that year, year and a half of operating and back to normal, if there is ever a back to normal after something like that, unless somebody finally figured out that wait a minute, there’s an opportunity here, and we better get on top of it. So, to me that’s a very important factor in however you put in what happened. There’s no point in—I’m not trying to suggest don’t say it. I’m just trying to say I don’t want that to be—I would prefer that not to become the focal point.
Daniel Satinsky: Yeah, I agree with you, and I don’t want it to be. I don’t want it to be. I don’t want Paul Tatum, I don’t want those things to be the focus of this story, so they aren’t.
Jeffrey Zeiger: Good. I appreciate hearing that.
Daniel Satinsky: People can read that elsewhere.
Jeffrey Zeiger: Right. You read that elsewhere. Don’t let one bad thing, although it was a big bad thing, overshadow the multiple smaller good things that happened over the five-year history of TrenMos.
Daniel Satinsky: Right. And what to me is weird is that all of us knew that this krysha system existed.
Jeffrey Zeiger: Yeah, sure.
Daniel Satinsky: It was just part of the environment.
Jeffrey Zeiger: But it exists here, too, just different. I mean, not that you pay protection, but... And by the way, people did pay protection, right, back in the ‘30s, ’40s, ’50s.
Daniel Satinsky: Absolutely.
Jeffrey Zeiger: So, you know, l maybe—again, I don’t know. And I’m not just—listen, I’m not justifying it. That’s why I left because—phew—I didn’t want—
Daniel Satinsky: Yeah, well, there were rules there that you don’t know, and you violate those rules, and the consequences are pretty terrible.
Jeffrey Zeiger: Pretty dire.
So, I appreciate your time very much, sir. And if you think of anything else. I’ll do this introduction tomorrow, I promise you.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: It’s been a good ride. I made a lot of money, met my wife, yeah. So, I wound up, they wound up sending pennies on the dollar, and they wound up with restaurants that lasted maybe another six months after I left.
Daniel Satinsky: And these were people who came to you and said listen, now I know you didn’t have a…no krysha, if you don’t have one, I’m your krysha—
Jeffrey Zeiger: Yeah, yeah.
Daniel Satinsky: Okay.
Jeffrey Zeiger: I said no, you’re not. I said no, you’re not. The only bright spot in the whole thing is the guy that started out peeling potatoes and carrots—they used to go through 500 pounds of apples a week for my apple pie. I hired a kid who today is the No. 1 restauranteur in Moscow.
Daniel Satinsky: What’s his name?
Jeffrey Zeiger: Arkady Novikov. And he’s got the chain of restaurants; he’s got all the famous ones like Syr* and Vanil. Vanil, he opened—Vanilla—in my old bistro where he used to peel potatoes. Oktoberfest, he opened. I mean, this is going back now. And he’s still there. He’s in his—I would say he’s probably in his mid 40s. So, that’s a good takeaway story.
But yeah, they sent pennies on the dollar, I got on a plane, brought my wife here. I have two beautiful daughters, beautiful family. No regrets except for the fact that I really think that if I had…it’s a double-edged sword because if I had…I could have expanded TrenMos into the entire Russian Federation, and probably every republic I could have had a TrenMos. But I didn’t…I was 23 and to me it was more important that the salt and pepper shakers were full on every table, and the service was going to be the same every night, and that I would be there to meet my guests.
And I’m not saying one’s right and one’s wrong. We made a lot of money, and we did well. Could it have been better financially? Probably a lot better. But we did very well, and I’m here, and I’m very happy telling you the story. And we set a trend. You look at Moscow today, and I can’t take all the credit, but I certainly can take the credit of bringing foreign restaurants into Moscow. You look at Moscow today with 15, 20,000 restaurants from all over the world. You can be in downtown Moscow and not even realize you’re in Moscow from the culinary perspective.
Daniel Satinsky: Yeah, absolutely. And so, were there a number of people who came through your restaurant who then went on in the industry, to seed the industry, so to speak?
Jeffrey Zeiger: I know that part of our big thing the chef and I would always talk about would be training. And so, I know that some of my maître d’s are still working today in restaurants because my wife goes back. She has family and friends there. And she runs into them in restaurants, and they recognize her. The back of the house I kind of lost track because I lost track of where they would be. But like I said, the biggest standout to me is Arkady Novikov. But that was part of the mission, too, was to train these people so that they could be involved in the restaurant or at least have an understanding of hospitality.
But look what happened, I mean, the Ritz-Carlton, Hyatt, Marriott, all of those hotel chains that would never even think of going there, wouldn’t have been there. Now it’s like Moscow came on the radar. And I’m not saying it’s because of me. I’m not saying that. I’m saying I think people like me, and John, and Stan, and some of the other people you’re interviewing kind of pushed the issue of foreign—again, not oil and gas because, you know, not really thought of as being…like you said, things that were not part of the Russian or Soviet economy—hotels, hospitality, real estate—that was never common. And now they are.
Daniel Satinsky: Yeah. And now they are, yeah. And in a certain sense it seems to me, and part of the thesis that I’ve come to from listening to any number of people, is that they knew what they didn’t know at the time. They knew they needed foreign expertise, they got it, and over the course of a decade, or in some cases less, a lot of people, they sent kids abroad, they learned from the foreigners, and there was less need for foreigners. By the early 2000s they didn’t need to pay the hazard pay. And they absorbed so much from that decade that it transformed the country in really noticeable ways, I mean, you know. So, there was less of a—
Jeffrey Zeiger: I would just add one thing to that, which is even on top of that—I agree with everything that you said. I would just add that in some cases they even became employers of foreigners.
Daniel Satinsky: Yeah.
Jeffrey Zeiger: And I think that’s the true, you know, full circle effect, as my dad would like to say, you know. That’s the full circle. So, we came in, we were the employers, we taught, we partnered, we learned together, different cultures, different whatever. And then at the end of, the top of the circle coming back, now you are hiring foreigners to work for you in your country.
That’s where a guy like Novikov is the full circle. That’s what he’s doing. And there are a lot of examples, I’m sure, in other industries like them. And I think your point is right on. And I think, but I do think that some of the best years of our relationships, “our” mean the countries’ relationships, when people worked together. And that was my dad’s philosophy. It’s harder—to get to understand somebody and understand their culture, the Russian people are the warmest people on the planet. Governments may be fakakta, a Yiddish word, may be—
Daniel Satinsky: Yeah, I know that word.
Jeffrey Zeiger: Good. But the people? They are more like Americans than any European country. They are more like—
Daniel Satinsky: Absolutely.
Jeffrey Zeiger: —values, education, religion, all of those things that we hold so precious, they’re right there, if not, in some cases, even more. There was always this government-to-government thing. You get down and you go into a Russian house, or a Russian apartment and you have dinner, or you go into a Georgian, you know, I’ve been to Georgia many times, Tbilisi and Sukhumi and all those, the hospitality and the genuineness of those people—you don’t get that unless you live it, breathe it and work with it. You don’t get that. And I think that helped our countries. And now you have the polarization again. Think about it. You have this polarization again, you have the ideology coming out again, you have the lack of cooperation coming out again, and what is the result? Tension. And again, not to get political with you, but I think the two go hand-in-hand.
Daniel Satinsky: Yeah, I agree with you. And the lack of actual contact between ordinary people, it’s so striking between that time and this time.
Jeffrey Zeiger: One hundred percent.
Daniel Satinsky: Enormously different. So, that’s part of the agenda of this book, is to talk about that. This is, you know, a period of time when there was the only and the most interaction between Americans and Russians in history were in those years. I mean, day-to-day interaction.
Jeffrey Zeiger: Day-to-day, day-to-day. There are times in history, very interestingly, and not a lot of people know this, where Russia and America were actually very friendly to each other. Abraham Lincoln and the czar communicated many times in very deep, thoughtful letters during the slavery, during the emancipation and things like that, and Russia helped tremendously, the Soviet Union, in other times, and we’ve helped them.
But to your point, ingraining yourself in the community or in each other’s culture was never as strong as it was, I would say, from the mid ’80s up until 2000. I think that was the real time of it, something like that. Only those that were there. Only those that were there know that and feel that.
Daniel Satinsky: Yeah. Well, I know it and feel it, so… And am trying to convey it, and your words will help me.
Jeffrey Zeiger: Thank you. And hats off to you. And any way that I can help, any way that, you know, any other people that I can think of. And Stan I’ll do the intro. I’ll introduce you. And he’s a great guy. He’s got a lot of stories, too, because he was involved…he really was an entrepreneur, and I was more on the people level with the restaurant ops. They were in the ministerial and those kinds of levels because it was telecom and those kinds of things, so there may be a whole different perspective.
Daniel Satinsky: Sure. I think I may have met him once or twice at the U.S.-Russia Business Council or something.
Jeffrey Zeiger: He was all over that.
Daniel Satinsky: I’m sure he wouldn’t remember me, but I do remember the name, so it would be great if I could talk to him. So, I want to ask you one last question, and I think you probably are ready to get going, but…
Jeffrey Zeiger: Well, I appreciate your time, too.
Daniel Satinsky: So, when the guy says to you, you know, if you don’t have krysha, I’m your partner, and you walked away from it, were you bitter? Did you come home and say those da-da-da’s and, you know? Did you feel bitter or taken advantage of?
Jeffrey Zeiger: No. And I think there are at least two, maybe three reasons. First and foremost, I’d already begun the process in my mind of thinking how do I have my child—my wife, as I mentioned, it was at that time, the end of ’94, was pregnant, and I didn’t want my child, my first child, any child, to be born there.
So, already thinking about not to leave—I mean, the ideal world at that time would have been to come here and have the baby and then kind of go back and forth and maybe expand. But those were the long gut entrepreneurial answers, right? Okay, still I’m 25, 27, that’s what I want to do. Reality was setting in, as I mentioned, that the landscape was changing. It was becoming harder and harder to do business in an American style, Western style way. And that’s not the krysha issue, the Mafia issue. That’s also they were going through. “They,” the Russians were going through turmoil and hell from an economic point of view, a currency point of view, from an understanding of the change of socialism to quasi whatever you want to call it ism.
And third, and probably most important, besides the baby, it wasn’t…the competition was getting better, and I didn’t have the funds to compete against the Marriotts and the Radissons and the European restaurants, and the European money that was flooding in there because they were seeing the results. Again, I’m in the restaurant world, but even across the spectrum of business. Businesses were saying hey, we can make money here, we can do things here. All of a sudden you have the—so as more and more people came their expectations also came with that. So, you had more guys coming with more fancier and better restaurants, and hotels, and all those things.
So, in my world it wasn’t Moscow with ten restaurants anymore. Maybe it was Moscow with 200. The extra 200 restaurants were high-end restaurants, stealing away my thunder that I had that I was so much better than everybody else. Now there are guys that are really much better than me. Because we were operation bootstrap. I mean, it was me, me and my dad. It wasn’t a back of the house, accounting, and HR, and money to spend on design and the layouts. We just did it. I’m not complaining.
So, you said was I bitter. I think it was almost like, in Yiddish there’s also another word called beshert, meant to be. Maybe it was meant to be that the timing of my partner being killed, my wife pregnant with my first child, and the landscape in my world, restaurant world, really significantly changed to where maybe it’s meant to be that I go—that’s how I thought at that time, and I still think.
And I still think that way today because no point in being bitter. I did well, took the best thing out of Russia, which is my wife. And would I do it again? In a heartbeat. I’d do it a little different. Maybe I’d have ten restaurants instead of three, but I would do it again, for sure.
Daniel Satinsky: Do you have any kind of newspaper article or reference to your partner’s being killed?
Jeffrey Zeiger: Oh, if you look up…I’ll put in the chat his last name. It was covered by—because we were the first American restaurant. His name was Sergei Goryachev. It was 1992, 1993.
Daniel Satinsky: Okay, all right.
Jeffrey Zeiger: I mean, everybody—CNN, Wall Street Journal, New York Times. They were all friends of mine. I knew them all. But you’d find it. If I could make a request—
Daniel Satinsky: Yeah.
Jeffrey Zeiger: In your book, when people ask me about Sergei and what happened, it is part of my history, and I shared it with you, so I don’t… But the concern is that—and I’m not saying you’re going to do this—but if you can find a way to put it in there where it doesn’t become the focal point.
Daniel Satinsky: Yeah, I know what you mean.
Jeffrey Zeiger: You know what I mean? Because I don’t want people to think that he was a bad guy, No. 1. I don’t want people to think that he, you know, maybe, you know, that he was with the Mafia the whole time and I didn’t know. I have a very good—I had a good relationship, and I still remember him fondly. And he made a mistake. He made a very costly mistake. A mistake of greed. And maybe that greed was because in his whole life leading up to it, he was working in a system that didn’t allow for capitalism and things like that. Now, that’s a whole different issue.
But I guess if I’m thinking about how an outsider would read it, and they read this story about this wonderful experience, what these people did, and they brought this to that, and they brought restaurants not only financial success, but culinary, and people enjoyed it, it was the restaurant to go to for your special occasion, and then they read that the guy got killed, that kind of takes all the air out of the balloon, so—
Daniel Satinsky: It does, it does.
Jeffrey Zeiger: I’m not trying to tell you how to write it.
Daniel Satinsky: Yeah, no, I know what you’re saying. And I’m trying to—I actually, it’s a dilemma for me because the stereotypes of the time were, you know, the Wild East, lawlessness, Mafia, all the stereotypes about Russian people, which I’m trying to avoid, and which I argued against my whole life, that that’s all people knew about, was that, and they didn’t know anything else. So, I can’t ignore it, but I don’t want to sensationalize it.
Jeffrey Zeiger: Well, yeah. And one thing that may make it better, or easier, is that the amount of time from the time he was killed, which was ’92, ’93, I operated till the end of ’94 before I was approached.
So, I always tell people if there were…if that killing triggered something, or we were already in with something, there would have been that year, year and a half of operating and back to normal, if there is ever a back to normal after something like that, unless somebody finally figured out that wait a minute, there’s an opportunity here, and we better get on top of it. So, to me that’s a very important factor in however you put in what happened. There’s no point in—I’m not trying to suggest don’t say it. I’m just trying to say I don’t want that to be—I would prefer that not to become the focal point.
Daniel Satinsky: Yeah, I agree with you, and I don’t want it to be. I don’t want it to be. I don’t want Paul Tatum, I don’t want those things to be the focus of this story, so they aren’t.
Jeffrey Zeiger: Good. I appreciate hearing that.
Daniel Satinsky: People can read that elsewhere.
Jeffrey Zeiger: Right. You read that elsewhere. Don’t let one bad thing, although it was a big bad thing, overshadow the multiple smaller good things that happened over the five-year history of TrenMos.
Daniel Satinsky: Right. And what to me is weird is that all of us knew that this krysha system existed.
Jeffrey Zeiger: Yeah, sure.
Daniel Satinsky: It was just part of the environment.
Jeffrey Zeiger: But it exists here, too, just different. I mean, not that you pay protection, but... And by the way, people did pay protection, right, back in the ‘30s, ’40s, ’50s.
Daniel Satinsky: Absolutely.
Jeffrey Zeiger: So, you know, l maybe—again, I don’t know. And I’m not just—listen, I’m not justifying it. That’s why I left because—phew—I didn’t want—
Daniel Satinsky: Yeah, well, there were rules there that you don’t know, and you violate those rules, and the consequences are pretty terrible.
Jeffrey Zeiger: Pretty dire.
So, I appreciate your time very much, sir. And if you think of anything else. I’ll do this introduction tomorrow, I promise you.
Cafeteria, canteen in Russian
Bank for Foreign Economic Affairs
Avenue
Soft sign
Good
Profiteers
Prague
Lit. canteen's trust
The roof, Mafia
Cheese
