Country Guide

Ukraine

Ukraine
Inna Shylova

Guest Editor

Inna Shylova

Community Builder at LIFT99 Kyiv Hub

Inna Shylova is a community builder at LIFT99 Kyiv Hub — the top startup community space in the heart of Kyiv. She oversees talent matching, network building, and event development for the local ecosystem.


Guest editors are local ecosystem leaders: successful founders, investors, or thought leaders. Have someone in mind? Nominate a country guest editor.

Disclaimer: all content within the Startup Ecosystem Summary and Editor’s Guide sections is written by and reflects the personal perspective of the guest editor. The guest editor is not responsible for content within the Country Snapshot and Community sections, as much of this content is compiled from external sources and does not necessarily reflect the guest editor’s view.

Startup ecosystem summary

Key Startup Cities

Kyiv, Odesa, Lviv, Kharkiv

Connected Country Ecosystems

Estonia, Latvia, Lithuania, Poland, Germany, US

Differentiators

  • Young population
  • Highly qualified and specialized IT talent‎
  • Affordability

Challenges

  • Weak global perception of Ukraine and the Ukrainian startup scene
  • Difficult to establish a company in Ukraine considering taxes and bureaucracy
  • Lack of foreign investment

Editor's Guide

Introduction

Today, Ukraine has 400+ startups and the number is consistently growing (to see a detailed view of Ukrainian startups, check out this list published by LIFT99 Kyiv). Local success stories include Ajax Systems, Allset, Attendify, Competera, Depositphotos, Grammarly, Invisible.io, MacPaw, People.ai, Petcube, Preply, Readdle, Restream, YayPay, and YouScan. These 15 rockstars were recognized on the Ukrainian Startups Wall of Fame in 2019 as symbols of the development of a value-driven ecosystem–an ecosystem of and for Ukrainian startups with an impact on the local economy, on the country’s general image, on public well-being and standard of living, and of course, on the next generation of entrepreneurs.

Kyiv in particular has the potential to turn the Ukrainian startup scene into one that’s as vibrant and buzzing as Berlin or Tel Aviv, if not more. There are numerous events happening every day including empowering hackathons, workshops, meetups, conferences – many of them with well-known international names. New co-working spaces are springing up like mushrooms after rain and the waiting lists for some of the more popular central spaces are being filled before the doors open. Alongside incubators and accelerator programs, these co-working spaces help young startups to mature and grow into strong tech companies.

Outlook

Ukraine has a huge pool of amazing talent. The technical side of tech has always been promising in Ukraine, with Ukrainian developers being in the top-10 for hiring demand. The challenge is to leverage this talent to boost the entrepreneurial spirit in the country. Today, the Ukrainian startup ecosystem is growing fast. A few years ago, Ukraine was mostly known for its amazing developers, but startups are now recognizing their Ukrainian roots. More and more founders are eager to start developing products locally, inspiring others to follow.

In terms of the challenges ahead, the investment scene is a sensitive topic in Ukraine due to the bad reputation of the country in terms of the economy, corruption, and political conflicts. However, raising a seed-round in Ukraine is quite feasible nowadays. Some of the experienced Ukrainian founders have turned to make angel investments themselves and are giving back to the community this way. Not all rounds are coming from locals, but it’s expected that more of the upcoming rounds will come from outside of Ukraine, helping local startups enter the global scene.

Featured Tech Startups

Editor’s choice of the country’s top 10 emerging tech startups.

Startup Showcase

Editor’s pick of which ‘Featured Startup’ is especially worth following and why.

Awesomic is a subscription-based app enabling users to get design tasks (graphics, web & mobile UI tasks) done within 24 hours. The founders, Stacy and Roman, used to run an online school, and one of the most frequent questions they received from their clients was: “Where did you get such amazing design?” They therefore set out to create a solution catering to companies who need design services from time to time but don’t need a full-time designer. The product was launched 10 days after the initial idea and quickly got its very first clients. In August 2020, the startup raised its first round and is focusing on scaling the product.

Focus Industries

Editor’s choice of the industries with the most potential for technology disruption and growth.

GamingThe most popular genres in Ukrainian game development are Action (40%) and Adventure (42%). The total audience of games that Ukrainians are working on is more than 770 million users. The largest audience was gathered by large companies like Plarium, Ubisoft and Wargaming. 84% of local game development companies work on games for mobile platforms, mostly for iOS and Android.
Marketing TechThere's US$130 million in disclosed investments for Ukraine's 160+ Marketing Tech companies. Over 5,000 employees work in Marketing Tech, and most of the companies operate in B2B segments.
SaaSUkrainian SaaS companies have raised US$550 million. However, the majority of this amount comes from Gitlab and Grammarly funding rounds. In fact, 22.7% of companies didn’t raise any funding. More than half of local SaaS companies are located in Kyiv. Other popular locations include Odesa, Dnipro, and Kharkiv. Most of the startups are B2B SaaS or B2B2C.

Talent

Editor’s perspective of the maturity level of talent in the ecosystem.

  • Technical TalentAdvanced
  • Marketing TalentUndeveloped
  • Experienced TalentModerate
  • International TalentUndeveloped

Culture and History

Editor’s commentary on how the country’s culture and history have impacted the ecosystem.

Ukraine is home to more than 120,000 IT professionals – most of them are developers. The favorable price-to-quality ratio and quality talent makes Ukraine one of the primary destinations for tech giants like Microsoft, Boeing, and Magento to outsource their software development needs.

To put things in perspective, the average salary in Ukraine is about US$350, while the average salary in IT is US$2000. This is the reason why technology and English courses are becoming widespread and the amount of ‘switchers’ – people who move from other specialties to IT – is growing exponentially. The IT sector currently accounts for approximately 3.5% of Ukraine’s GDP and promises to reach almost 9% by 2025 according to the IT Ukraine Association’s report released in January 2018.

Ukraine’s challenging situation, both economically and politically, has raised a young generation of hopeful reformers. It’s a generation full of motivation and willpower – the people who are ready to be the change in the country. Combined with the abundance of tech talent, it’s not a surprise that startup success stories have started to emerge.

Interested in becoming more involved in this ecosystem and connecting with local ecosystem leaders? Let us know.

Community

Active Investors

AVentures Capital (Kyiv): Focus: SaaS; investments: A-B rounds ($500k - $2 million), invested in: Augmented Pixels, Petcube, Bookimed, CoreValue, Influe2, depositphotos

Chernovetskyi Investment Group (Kyiv): Focus: AR/VR; investments: seed/A-round ($100k - $2 million); invested in: Zakaz.uа, Doc.ua, Eda.ua, Softcube, Kray Technologies

Digital Future (Kyiv): Focus: digital marketing, advertising, artificial intelligence, security, internet of things, SaaS, marketplaces ; investments: $50-$400k; invested in: Attendify, Petcube, Promorepublic, Serpstat

Genesis Investments (Kyiv): Focus: machine learning technologies; investments: seed-US$5 million; invested in: Better Me, Liki24, Mate Acedemy

TA Ventures (Kyiv): Focus: artificial intelligence or machine learning; investments: $150-$500k; invested in: Liki24, Mate Acedemy

incubators

Demium Kyiv (Kyiv): Global incubator with program in Kyiv.

accelerators

Yep (Kyiv)

Startups Raising Capital
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Startups Hiring
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Coworking Spaces/Hubs

LIFT99 Kyiv Hub (Kyiv): To help startup teams rocket, LIFT99 organizes and hosts events that align with a startup-community vision, offers value with know-how, helps make crucial connections, and supports startups on their path to global growth. With our broad hand-picked community network, LIFT99 organizes over 250 yearly events designed for co-growing, knowledge-sharing, and collaboration across the international startup ecosystem. The startup hub provides: regular office hours with top investors; practical workshops/roundtables/lectures with the coolest top-notch speakers and mentors; matchmaking events; community minglings and lunches for networking.

UNIT.city (Kyiv, Kharkiv): Unit City is an innovation park with a concentration of companies, startups, students, professionals and research laboratories. Additionally, Unit City launched an accelerator program called Sector X.

Government Programs

TechUkraine: A nation-wide platform, uniting key Tech players to develop the ecosystem. TechUkraine is a spin-off from the Export Strategy for IT Sector, initiated by the MEDT (Ministry of Economic Development and Trade of Ukraine), supported by the GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH) and realized according to the ITC methodology.

Ukrainian Startup Fund: The Ukrainian Startup Fund (USF) is a state owned fund launched by the initiative of the Cabinet of Ministers of Ukraine. The mission is to support innovation projects and help the most talented Ukrainian entrepreneurs create successful companies at scale.

Non-Government Organizations

Country Snapshot

Economy

Startup funding
Startup funding
US$31 million (2020)
Standard of living
Standard of living
Global rank: 93
Innovation
Innovation
Global rank: 45 (2020)
Entrepreneurship
Entrepreneurship
Global rank: 73 (2018)
Annual GDP growth
Annual GDP growth
3.2% (2019)
(Global avg. 3.0%)
Ease of doing business
Ease of doing business
Global rank: 64 (2019)
Ease of starting a business
Ease of starting a business
Global rank: 61
Research and development
Research and development
0.5% of GDP
(Global avg. 2.3%)
Contract enforcement
Contract enforcement
Global rank: 63

Sources

Startup Funding: Dealroom
STANDARD OF LIVING: International Monetary Fund - GDP per capita (PPP)
INNOVATION: Global Innovation Index
ENTREPRENEURSHIP: Global Entrepreneurship Index
ANNUAL GDP GROWTH: World Bank
EASE OF DOING BUSINESS: World Bank
EASE OF STARTING A BUSINESS: World Bank
RESEARCH AND DEVELOPMENT: World Bank
CONTRACT ENFORCEMENT: World Bank

*Updated with latest available data based on listed source.

Society

Population
Population
43.7 million (2020)
Government
Government
Semi-Presidential Republic
Stability
Stability
Global rank: 105 (2020)
Internet usage
Internet usage
58.9% (2019)
Smartphone usage
Smartphone usage
48.3% (2018)
Literacy
Literacy
99% (2012)
Population under 15
Population under 15
15% (2019)
Median age
Median age
40.6 (2018)

Sources

POPULATION: Worldometer
GOVERNMENT: The World Factbook
STABILITY: Global Innovation Index
INTERNET USAGE: International Telecommunications Union
SMARTPHONE USAGE: Newzoo
LITERACY: World Bank
POPULATION UNDER 15: World Bank
MEDIAN AGE: The World Factbook

*Updated with latest available data based on listed source.

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