CHAPTER 2
RUJA AND SEBASTIAN
Sofia, Bulgaria, 2008
Sitting in front of two large monitors filled with updating charts and numbers as she sipped on a Diet Coke, 28-year-old Ruja Ignatova was frustrated. There was nothing wrong with her job per se—quite the opposite, in fact. She loved that the whole world was there on her screen: share prices; currency exchange rates; investment portfolios. It was these numbers that most accurately, most precisely, reflected what was going on out there. Being a consultant for the prestigious McKinsey & Company was about the best job available in Sofia in 2008, and her clients were a checklist of the top banks in the world: Sberbank, UniCredit, Allianz. She got to travel too. Like many Bulgarians, Ruja spoke fluent Russian, which meant she was often flown to Moscow or St. Petersburg to help Russian banks tap into the European markets. Everyone at McKinsey was ambitious, but Ruja stood out. She was one of those people you could email any time of day or night and receive a reply within minutes. “I don’t want children,” she used to tell co-workers in her slightly cold and matter-of-fact way. “I’m far too busy trying to change the world for anything like that!” Colleagues in the ten-person office sometimes found her a little distant, mistaking her work ethic and obsession to detail for rudeness. Clients, on the contrary, found her charming as well as effective—one major Bulgarian bank had even tried to poach her. No, it wasn’t the job that was the problem. It was her.
Working as a consultant for McKinsey was a million miles from the Bulgarian port town Ruse, when, under the never-ending rule of the Soviet loyalist Todor Zhivkov, Ruja was born to Veska and Plamen Ignatov on May 30, 1980. Her parents might as well have been born in another century. They were the post-war Eastern Bloc generation: stoic, hard-working people (Plamen had trained as a mechanical engineer, Veska was a teacher at a nursery) and their daughter’s work in financial services was a mystery to them both. Occasionally Ruja would try, without success, to explain to Veska what she did on her monitors all day. Ruja was only where she was because of Plamen and Veska’s decision to leave Bulgaria in search of a better life in Germany when the Iron Curtain was drawn open in 1990. The young family (which by then included Ruja’s four-year-old brother Konstantin) finally settled in the poor quarter of the small southwestern town of Schramberg. Plamen found work fitting tires and all four Ignatovs lived in a small apartment above a butcher’s at number 11 Marketstrasse. Leaving Bulgaria as a child explained Ruja’s unusual accent, which flitted between harsh German consonants and rhythmic Bulgarian. In later years, she sometimes told people it encapsulated the two sides of her personality: the impulsive Bulgarian and the rational German.
Like the children of many immigrant families, academic success was non-negotiable. But even by the standards of demanding parents, Ruja was exceptional. In school she was top of every class, brilliant in every subject. One teacher in Schramberg said she was the smartest student he’d ever taught.1 In a fifth-grade homework assignment, the class was told to learn the first stanza of a Goethe poem. Ruja had only been in Germany for two years, yet the following morning recited all 13 stanzas perfectly. A little later she skipped a year because she was so far ahead. But it wasn’t easy being the brightest kid in school. Fellow students found her aloof and arrogant. While her little brother “Konsti” skated with friends, 16-year-old Ruja strutted around the corridors in high heels and bright-red lipstick like she was too good for the place. “Nobody got really close to her,” one schoolmate later recalled. Unlike most teenagers, Ruja rarely went to friends’ houses after school, preferring the company of her parents, playing chess, or studying. In her end-of-year schoolbook, 18-year-old Ruja described herself as “always well behaved and cheerful… faultless,” before adding: “Stop! Maybe we should stick to the truth? OK, fine. Maybe I did take pleasure in tormenting some students. I was always looking for the chance to spread new amusing stories about them.”
Everyone agreed she was destined for greatness. At 18, she won a prestigious scholarship to Konstanz University, one of Germany’s elite “Universities of Excellence,” where she completed a PhD in Law, during which she also completed a distance learning course in economics from the University of Hagen. And, just like in high school, she had interests beyond her years. She toyed with politics, briefly becoming a student representative of the center-right Christian Democratic Union party. While most students attended lectures in tracksuits and joggers, Ruja turned up smartly dressed and perfectly groomed. While studying, she met, fell in love with, and eventually married, Björn Strehl, a fellow law student who was ambitious and intelligent. “It was love at first sight,” Ruja said in a later interview. “I immediately knew, this guy I will marry.”2 Academia was a breeze too: after Konstanz, she was accepted into Oxford University for a master’s degree in Comparative European Law. It was always the same story: she stood out as painfully clever yet aloof. Always distant, always top.
No—working for McKinsey wasn’t the problem. The problem was her ambition. From a young age, Ruja told friends she would be a millionaire by 30. She desperately wanted to be rich—even devouring books in the early hours about how to make money. But she was already 28 and, with a financial crisis brewing, in danger of becoming just another successful person. That wasn’t enough for the woman who was always the smartest in the room.
Stockholm, Sweden, June 2010
Sebastian Greenwood looked around the quay in front of Stockholm’s grand Royal Palace, feeling pleased with himself. The wedding of Crown Princess Victoria and Daniel Westling was Sweden’s biggest event of the decade. It was so important that the Swedish government had declared a 13-day national holiday called Love Stockholm 2010. TV companies from all over the world clustered and jostled for the perfect shot of the royal steamship SS Orion, which had been restored for the occasion. There had been a scramble over the sponsorship slots—Volvo, Ericsson and IKEA were all desperate to get their famous logos associated with Love Stockholm.
Somehow Sebastian had managed to finagle his company, SiteTalk, a sponsorship slot alongside these household names.3 For the fresh-faced 33-year-old PR guy, who’d only been working for SiteTalk for a few months, it was a huge coup. Career defining? Sebastian would say so. Then again, Sebastian would say anything for effect. He was a born publicist. Although naturally shy, even as a pupil at the exclusive Östra Real secondary school, he was supremely confident in his own abilities and understood the power of showmanship.4 His dream was to become a successful entrepreneur, and, by his late twenties, he’d set up several websites dedicated to himself and filled with brazen self-promotion: “Much can be said about Sebastian Greenwood,” read one. “However, the best way to talk about Sebastian Greenwood may just be that he is the most well-rounded person you will ever meet.” In other words, Sebastian possessed the perfect mix of charm and bullshit for PR.
That combination had obviously worked on the organizers of Love Stockholm, because if they had known anything about SiteTalk, they would have probably returned his sponsorship money. Fortunately for Sebastian, most people had never heard of it, because it came from a strange parallel universe called “multi-level marketing.”
MLM was invented by accident. In the 1940s, a handful of inventive door-to-door vitamin sellers in California realized they were inadvertently generating sales for their company each time they recruited a friend to become a salesperson, but they never got paid for it. They had an idea: why not pay salesmen a small commission from any sales made by people they’d recruited? Voilà! A whole new business model was born. By the turn of the century, MLM had metastasized in a hundred directions, becoming a multi-billion-dollar industry comprising firms like Amway, Avon, Herbalife, and Tupperware. Promoters buy products—vitamins, health shakes, coffee, anything—and try to sell them directly to consumers, taking a cut for each sale they make. But the real money is in recruiting a “downline” of new sellers and accumulating commissions from their sales. The year of Love Stockholm, roughly 100 million people worked in MLM around the world. While not illegal, MLM is controversial, because those near the top become richer than kings but most people make hardly anything at all. As a result, MLM companies aren’t usually invited to sponsor high-profile events like Love Stockholm.
Then again, SiteTalk wasn’t like other MLM companies. It was special.
The year before Love Stockholm, a Norwegian man in his forties called Jarle Thorsen had convened some of the region’s top MLM sellers with a promise to revolutionize the whole industry.5 In a typical MLM business, promoters purchase vitamins or make-up or energy drinks, which they try to sell on. But too many MLM employees were ending up with garages stacked with boxes of immovable product. Everything is going digital, Jarle told the small group in a meeting just outside Stockholm. Facebook and Google don’t have physical products, so why should MLM? Jarle created an MLM firm called Enigro (later renamed Unaico). And its main product wasn’t vitamin tablets, but virtual shares in a new social media platform: SiteTalk. MLM was going digital.
Over in the US, MLM promoters were still selling Tupperware in the same way they always had: home parties and tedious lunchtime seminars. But SiteTalk transformed the Scandinavians into technologists who talked about “digital transformation” and “social networks.” In truth, what exactly investors were buying was vague and unclear—there were few details beyond it becoming a rival to Facebook one day—but, propelled by social media’s growing popularity, within a couple of years SiteTalk quickly became one of the biggest MLM products in the region with over 100,000 investors in its virtual shares. A specialized comms firm run by Sebastian’s parents was put in charge of the PR, which was how Sebastian ended up on the quay by the Royal Palace in June 2010 doing interviews with journalists about SiteTalk and Love Stockholm.
The bosses at SiteTalk quickly spotted that Sebastian was more than a PR guy—he was a gifted salesman too. He could confidently recite word-for-word an entire sales pitch he’d heard only ten minutes earlier. (And, by virtue of having a British father, Sebastian spoke near flawless English.) He was soon onstage himself, enthusiastically selling SiteTalk directly to investors all over Europe. “Our growth is amazing,” he roared at an event in Slovenia in early 2011. “That is thanks to all of you guys!”6 Sebastian loved the work and was soon spending most of his life promoting what he called the “next Facebook.”
When the company decided to target the fast-growing Far East market, Sebastian made a life-changing decision. He left his wife Helen, two young children and pleasant suburban house in Stockholm, and headed for Singapore, determined to make his fortune in MLM.
Sofia, Bulgaria, 2011–13
Big firms like McKinsey were mostly sheltered from the worst of the financial crash, but not entirely. In 2009, the Sofia office was closed. Economic crises produce victims and losses, but, for the fleet of foot, the fissures are opportunities. Ruja considered returning to Germany and had recently bought a property just outside Frankfurt.7 But Bulgaria had changed a lot since the Ignatovs left in 1990. The highly educated children of the post–Cold War emigrants had been flooding back to the country since Bulgaria joined the EU in 2007, and Ruja was impressed by her countrymen’s business acumen and excited by Bulgaria’s strategic location between European and Russian markets. She also felt more connected to the country of her birth than she’d expected, later telling a journalist she’d been “missing something the whole time I was living in Germany.”8
Deciding to stay was a smart choice and Ruja quickly fell in with all the right people. Before too long she was seen around town with senior politicians—contacts from the McKinsey or Oxford days. For a spell she even worked at Bulgaria’s biggest investment firm, which was run by Tsvetelina Borislavova, the long-term partner of the president Boyko Borisov. Borislavova was a highly successful businesswoman in her own right, who was rated by Forbes magazine as the “most influential woman in Bulgaria” in 2012.9 Ruja looked up to the attractive and successful older woman, even studying carefully how she behaved and dressed.
The one thing Ruja liked as much as money was fashion. She was obsessed with style and image. Her Facebook profile picture at this time was a montage of Marilyn Monroe and Jackie Kennedy: “My thesis is that most women are either a Jackie or a Marilyn,” she wrote underneath. “Just for myself, I cannot decide.” These interests opened up less conventional circles. She started hanging around with a celebrity hair stylist called Borislav Sapundjiev, and even set up her own hair salon called “Funky Hair.” “Vanity will always need service,” she said at the time. She attended parties with Sofia’s most famous PR man Evgeni Minchev (who later appeared on Bulgaria’s Celebrity Big Brother TV series) and became best friends with Asdis Ran, a fast-talking Icelandic Playboy model known as “the Ice Queen,” even investing in Ran’s fashion business. For a while, Ruja planned to launch a line of cosmetic products called “RujaNoir,” although nothing came of it.10 “She was very ambitious,” recalls one friend from that period. When she wasn’t working or networking Ruja read, studied languages, or went clothes shopping: “She was always working on trying to improve herself one way or another.”
All in all, by early 2013, Ruja’s efforts were paying off. She was becoming a recognizable face within the city’s fashion, business and politics scene. And yet she still wasn’t rich. That same niggling fear of unrealized potential still stalked her. Although she now had a few business interests of her own, they weren’t making change-your-life money. Around this time, Ruja started researching Bitcoin.
Singapore, 2012–13
SiteTalk didn’t become the next Facebook. Like the majority of “the next—” companies, it struggled to transition from hype to serious business. Almost as soon as Sebastian arrived in Singapore, the bosses changed the name of Unaico to “The Opportunity Network” and SiteTalk shrank almost as quickly as it had grown, leaving many investors out of pocket. Although it limped on for another few years, Sebastian left some time in early 2013 after an uneventful and largely unsuccessful spell trying to promote the product (according to one former colleague, Sebastian was fired). But the experience had persuaded him there was money to be made in MLM. The serial entrepreneur in him must have noticed how complicated it was for SiteTalk to pay its salespeople, a common problem in an industry where commissions change weekly and promoters live all over the world, because together with a former SiteTalk colleague called Björn Thomas, Sebastian created a new company called Towah Group Cyprus, which promised to be a kind of PayPal for MLM firms that would take care of processing commission payments.11 When that didn’t work out, he tried again, this time calling it Loopium.12 Sebastian had a genius for seizing opportunities and getting people excited, but he lacked the application and patience required to turn ideas into successful businesses and it wasn’t long before Loopium was struggling for clients too. He’d left Sweden with a dream of making it big in MLM, but by the middle of 2013, Sebastian found himself travelling between Singapore and Cyprus, and running out of money.
He might have returned home and re-joined his parents’ communications firm, but, one day, a former SiteTalk colleague from Hong Kong called John Ng got in touch. John had been involved in SiteTalk’s Far East expansion and had noticed MLM’s rapid growth in China and Hong Kong. SiteTalk’s early success was thanks to the clever way it combined MLM with the latest technology. John had found something that was even more exciting than “the next Facebook.” It was “the next money.” It was called Bitcoin.