Over the past three years, Russian investment firm DST made a series of huge bets in tech that quickly paid off brilliantly.

It invested hundreds of millions of dollars into Zynga, Groupon, and Facebook and valuations that now look cheap.

DST investors have to be thrilled.

Given that, here’s a strange detail: According to Bloomberg’s Sabrina Willmer, when DST raised its latest billion dollar fund, it had to entice potential limited partners with cheap Facebook stock and a 25% discount on fees.

Why?

One partner at a rival VC firm Silicon Valley firm has a theory: DST had to offer new investors discounts in order to get them comfortable with sharing a bed with DST’s most famous – or rather, infamous – investor, Russian oligarch Alisher Usmanov.

Until recently, Usmanov has been DST’s biggest investor. He has a controversial past.

In 2010, Gawker’s Ryan Tate published a handy summary of what we know about Usmanov, “aka ‘the hard man of Russia.”

Quoting from Tate:

• Usmanov has been dubbed a “gangster and racketeer,” rapist and mafia drug trafficker by Britain’s former ambassador to Uzbekistan. Usmanov denies the charges.
• To fight the aforementioned accusation, Usmanov’s lawyers launched a much-derided legal campaign to keep British bloggers from even talking about the charges. There’s more in the video report “Blogs vs. Usmanov,” from British Channel 4′s cable network.
• A subsidiary of the De Beers diamond cartel named Usmanov in a suit alleging fraud and “unjust enrichment” in a fight over a diamond mine in northern Russia. Usamov’s people denied this publicly in strong terms.
• There are clues Usmanov could have been part of a violent plot to acquire mobile-phone operator Megafon. A former co-owner of Megafon disappeared from his bloodstained vacation home in Latvia after telling a U.S. federal court he had been physically coerced into selling his Megafon stake to IPOC, a Bermuda entity, as part of a “plot by high-profile individuals to secretly take over Megafon.” Two months after he disappeared, it was announced Usmanov had acquired 39 percent of Megafon, in part by buying IPOC’s Megafon shares.

DST did not return an email about this post.

Source: SAI