Milner is also an exceedingly wealthy Russian who started his venture capital career with help from Alisher Usmanov, an Uzbek-born metals magnate close to Russia’s president, Vladimir Putin. Most people who know Milner have shrugged off his connection to a pro-Putin oligarch. Milner’s business—early-stage tech investing—is far removed from the world of the Russian oligarchs who got rich by acquiring state assets at dirt-cheap prices. And the money from Usmanov, as well as from state-controlled VTB Bank PJSC, came during the presidency of Dmitry Medvedev, when the Obama administration was urging a “reset” of Russian-American relations.
But now, as Putin’s army is shelling Ukrainian cities, Usmanov and VTB are on sanction lists. And Milner is on the defensive. “I cannot go back and change history,” he says during several hours of Zoom interviews with Bloomberg Businessweek. “I cannot change the fact I was born in Russia. I cannot change the fact we had some Russian funds.”
Milner’s nonprofit, Breakthrough Prize Foundation, and his venture capital firm, DST Global, have both released statements condemning “Russia’s war against Ukraine, its sovereign neighbor,” as DST’s put it. A Breakthrough Foundation statement, credited to Chairman Pete Worden, referred to Russia’s “unprovoked and brutal assaults against the civilian population.” Milner and his organizations have pledged $14.5 million to fund humanitarian efforts.
Even so, Milner himself is careful when speaking about the war in Ukraine. He declines to express an opinion on Putin, instead citing the statements made by his organizations, and calls the war a “heartbreaking tragedy.” Now 60, he holds up a black-and-white family photograph, taken around 1970. It shows him as a boy, wearing a knit hat, in Zaporizhzhya, Ukraine, where he says he spent many summers with his father’s family. Days earlier, he says, he and a cousin helped evacuate a family friend, an elderly woman, from Cherkasy; her husband decided not to leave. “I fully stand behind statements made by DST Global and the Breakthrough Prize Foundation,” he says.
Milner, whose net worth is $3.9 billion, according to the Bloomberg Billionaires Index, is navigating a precarious situation. There’s a long history of foreign cash of dubious origin finding its way into Silicon Valley—most notably the funds from Saudi Arabia that continued to flow even after the dissident journalist Jamal Khashoggi was brutally murdered by government agents. But the war in Ukraine has galvanized the West, says Ayako Yasuda, a finance professor at the University of California at Davis. “Startups do have real reasons to worry about receiving funding from DST,” she says.
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There’s a risk that Milner could be tainted by the association, causing entrepreneurs to skip those lavish parties and turn down funding offers from DST. Investors might also hesitate to recommit to the firm when it next raises money, and Milner’s philanthropic work, most notably a series of rich awards for scientific achievement known as the Breakthrough Prize, could lose its cachet. Milner plays down those risks.
“Facts are on our side,” says Milner, arguing that DST has long been independent of Kremlin interests. He spoke from Dubai, where he was helping to fundraise for a company he declines to name. He’s still a Russian citizen but also holds Israeli citizenship. He’s been living in the U.S. on a so-called O-1 visa, for people of “extraordinary ability,” a common path for foreign-born tech entrepreneurs. He paid $100 million for the estate in Los Altos in 2011 and today considers the U.S. his home.
If Milner is frustrated, it’s partly because his move to the U.S. was made during a yearslong campaign to separate himself from his controversial early backers. “The great irony is that we are the least Russian fund right now and have been because we made a consistent effort,” Milner says. DST, he says, hasn’t taken any money from Russia since 2011, when it raised a $900 million fund, nor has it made any investments in Russia. Milner notes that, until recently, most Western banks were doing business with Russia, years after he’d stopped. He says he hasn’t seen Usmanov in about five years and hasn’t been to Russia in eight.
To support his claim about separating himself from Kremlin-connected cash, he shares a letter dated March 19 from his chief financial officer, Kenneth Leung, that outlines the steps DST takes to comply with banking “know your customer” and anti-money-laundering provisions. “If he lies,” Milner deadpans, referring to Leung, “he will go to prison.”
The firm is actively working on a handful of deals in various stages of diligence, he says. Having raised a ninth fund of almost $4 billion in 2021, DST won’t need to fundraise again for a year or two, and Milner says he thinks investors will stay loyal. Some left DST in recent years, but it wasn’t because of politics, he says. It was because in 2018 he raised his fees to 25% of profits, up from 20%.
Milner has powerful defenders. “Yuri Milner has been a valued friend and partner to me, our firm, and many of the U.S.’s best new technology companies for nearly two decades,” Marc Andreessen, a board member of Meta Platforms Inc. (a.k.a. Facebook), wrote in a March 1 tweet. Max Levchin, the Ukrainian-born chief executive officer of the financial technology company Affirm Holdings Inc., calls Milner a good friend. “He has been a visionary investor, and equally importantly, a passionate supporter and promotor of real science,” Levchin said in a statement.
Ryan Petersen, CEO of freight giant Flexport, has taken a series of investments from DST, the most recent in February, and says he wouldn’t hesitate to accept more. “I have zero concerns,” he says, adding that any questions he had about DST’s investors were fully satisfied years ago. “Yuri has incredibly high ethics.” He calls efforts to connect Milner to the Kremlin “on some level a little crazy” and suggests that they are discriminatory, conflating Milner’s birthplace with Putin’s policies.
Milner’s status comes from his success as an early-stage investor and from his interest in science. Named after the great cosmonaut Yuri Gagarin, Milner has a degree in physics from Moscow State University. After deciding he would never land at the top of the field, he dropped out of a physics Ph.D. program and started selling computers instead. In the late 1980s, as the Soviet Union collapsed, he moved to the U.S. to study business at the University of Pennsylvania’s Wharton School.
Milner worked at the World Bank in Washington, D.C., in the early 1990s and then moved back to Russia to run a brokerage. Inspired by a report by the famed internet analyst Mary Meeker, he launched an incubator and investment fund to develop Russian internet companies in the mold of EBay Inc. and Amazon.com Inc. He founded Digital Sky Technologies, a precursor venture capital firm, in 2005, just as valuations were recovering from the 2000 dot-com crash.
By the late 2000s, Milner, looking to diversify beyond Russia, created DST Global and set his sights on Facebook. When DST first invested in Facebook in 2009, it was at a $10 billion valuation, a huge price for a young company during the middle of the recession. But almost overnight, the $200 million investment, which included more Usmanov-connected funds than previously disclosed, according to a 2017 New York Times report drawing on leaked documents known as the
Paradise Papers, established DST as one of the top venture capital firms in Silicon Valley.
As his fortune grew, Milner spent lavishly on his personal life. He also put up more than $75 million to fund a search for extraterrestrial life and dropped an additional $300 million on the Breakthrough Prizes. In 2013, he invested in the satellite company Planet Labs PBC and in Elon Musk’s rocket company SpaceX. Milner says the investment in SpaceX was for about $10 million. He sold his position two years later for $23.56 million.
The SpaceX deal hasn’t been previously reported. Around the same the time, the company, a major Pentagon contractor, was bragging publicly that its rockets didn’t use Russian components, unlike others in the space industry. In April 2014, the company sued the U.S. Air Force for the right to compete for contracts, complaining that existing agreements were funneling money to Russia’s defense industry, including to Russians who were subject to U.S. sanctions. Milner says he was under no pressure to divest and sold his stake only because he didn’t appreciate the full potential of the satellite market. “I underestimated SpaceX,” he says. “Divesting early was a mistake.” He says he admires Musk and has talked with him about topics such as looking for aliens and traveling to the stars. Representatives for SpaceX didn’t respond to requests for comment.
Besides Breakthrough Listen, which searches for communication from aliens, Milner has also funded Breakthrough Starshot, which is in the early stages of a decades-long project to build tiny and ultrafast spacecraft that would fly to our neighboring solar system, Alpha Centauri.
He says the war in Ukraine throws the purpose of the projects, outlined in a treatise he published last year called the “Eureka Manifesto,” into sharper focus. If we learn that life does exist beyond Earth, the discovery could “be the unifying moment for our civilization,” he says. “It can be our generation’s equivalent to the first step on the moon. One of those moments when we all feel as one.”
He says he’s confident that life beyond Earth would demonstrate that our current distinctions based on national borders hold us back. “If there’s a civilization out there that’s a million or a billion years ahead of us, I’m very confident that it came together as one,” he says. Milner, in other words, is a lot more forthcoming on hypothetical intergalactic political questions than he is on questions about Vladimir Putin.
