In his remarks, Putin talked about how the school would “contribute to the development of the national economy,” how its alumni would “have to meet real-life business challenges” and “defend Russia’s interests in international markets,” and how they would “need professional training and skills, leadership and entrepreneurship, and of course deep, fundamental knowledge.”

He also had some kind words to say, in English, about the help the school had received from Russia’s former Cold War enemy.

“He was very generous in his recognition for what the United States—in particular the University of California-Berkeley and some of the independent donors—had done for Russia,” says Teece. “He showed genuine gratitude and warmth to those who had helped. I thought the fact that he took the time to do that was not just a very nice thing but contrary to the image that Putin has in the world.”

Now that Putin has made the GSOM an official National Priority Project, the school is on sound financial ground. But it wasn’t always so. Until Teece got involved, the school was only a gleam in the eye of its current dean, Dr. Valery Katkalo.

Katkalo had come to Berkeley from St. Petersburg as a Fulbright Scholar to study under Dr. Oliver Williamson, the former Penn professor of economics whose many books included The Economic Institutions of Capitalism, and whose work, like Mansfield’s, greatly influenced Teece. At Williamson’s suggestion, Katkalo went to see Teece shortly after the Soviet Union collapsed.

“He said, ‘David, there’s no business school inside a university in Russia. We need one,’” recalls Teece. “He said, ‘If I initiate the process of starting one, would you help me?’”

After thinking about it for a minute, Teece said he would. The reasons, he says now, boiled down to “high-minded idealism.”

“The obvious thoughts of ‘Win the Cold War, lose the peace,’ went through my mind,” he recalls. As a U.S. citizen, he had a “desire to see Russia progress in a way that Russia would be an ally to the United States—because if Russia and the U.S. can see eye to eye, then a lot of other issues in the world become simpler. And the best bet for doing that would be to get them on a market-based economy.”

He also had confidence in the enormously capable Katkalo—a good thing, since Katkalo’s next comment to Teece was, “Of course it will take a lot of money.” When Teece wondered aloud where that would come from, Katkalo said quietly, “Well, I have some ideas.”

“He was very shrewd,” says Teece approvingly, adding: “I was not without a little bit of political wiliness myself.”

Knowing how to negotiate the labyrinths of the academy was a valuable asset for someone trying to steer money to the other side of the world. Teece enlisted the support of the Haas School, as well as that of other Berkeley faculty experts on Russia and the Soviet Union; latched onto some grants to supplement the meager faculty salaries at St. Petersburg; helped round up an advisory board and some potential private donors; and along with his wife helped convince his mother-in-law to give a small rental house to Berkeley and earmark the proceeds for the program.

The school “had no computers and no supplies,” notes Susanne Campbell, executive director of the Berkeley-St. Petersburg program since 1993, in a piece she wrote for the Haas website. “For the first few years people from Haas brought boxes of office supplies in our suitcases. The faculty numbered four to six. Many had basic knowledge of economics and mathematics, but they lacked the knowledge to teach business subjects at the MBA level.”

She credits Teece with setting the tone of the partnership from the outset: “What makes a business school is the faculty,” he said. “Our job is to train a Russian faculty, not to replace them.”

“David played a central role in creating our very successful partnership with Haas, which was key for starting and developing the School of Management at St. Petersburg University,” says Katkalo. “David made tremendous intellectual and organizational contributions, especially in choosing the right strategy and business model for our school,” but also in bringing Haas faculty to teach and to develop joint research projects with the St. Petersburg faculty—and in bringing the latter to Berkeley to develop courses, audit classes at Haas, and do research.

“David’s involvement has always been critically important because of his status as one of the world leading scholars in management research, especially in strategic management and management of technological innovation,” adds Katkalo. “Both these fields have been quite new for Russian students of management and still today are on the forefront of our teaching and research in the context of the booming Russian market economy.”

Though the school is still a work in progress, it’s come a long way since then. It has 1,500 students in undergraduate, MBA, Ph.D., executive-education, and other programs taught by some 70 full-time faculty members.

A few years ago, Teece met with philanthropist George Soros, whose Soros Foundation provided one of the grants that supported the Berkeley-St. Petersburg program.

“He started Central European University, which is basically a hole in his pocket,” recalls Teece. “So he said, ‘I’ve got to give you credit: You did a hell of a lot better with the money that you had than I did with mine. What’s the difference?’”

The difference between the two schools is that the GSOM was built onto a major university—which, though weaker than it had been historically, still had a 300-year history of scholarship, notes Teece. “Even though the B-school part was completely de novo, the institutional apparatus of the university was there. There was infrastructure there.”

For Teece, the positive effect that the university system has had on his own life can hardly be overstated—or repaid.

“You do it because you believe it’s a good thing to do,” he says. “You don’t get rewarded for it. I feel extremely fortunate; the university system here has treated me so well. I mean, I really believe in these institutions. They are the institutions that make America great.”

 

Near the end of our interview, I ask Teece if he ever wished he could talk to Ed Mansfield now, or if he ever had any conversations in his head with him.

“You know, Mansfield wasn’t a particularly chatty guy,” he says. “But about 10 years after I graduated, I sat down and wrote him a nice handwritten note, telling him that he had really been influential, and essentially thanking him for his dedication to his field and his willingness to [mentor] me as a graduate student.

“It’s not something that I’m sure he would have expected, or is normally done,” he adds. “And five years later—and I didn’t know this would happen—he was dead. Maybe this is a selfish feeling, but I’m glad that I’d at least had my chance to thank him for his investment in me—and, implicitly, to thank the University of Pennsylvania for accepting me as a graduate student. If he’d passed away and I’d never done that, I would have regretted it.”