An attendee passes by the Ukraine stand on the Web Summit 2022 tech convention in Lisbon, Portugal.
Patricia De Melo Moreira | Afp | Getty Images
LISBON, PORTUGAL — As the warfare in Ukraine rages on, the nation’s expertise entrepreneurs try to remain optimistic.
“I don’t think there’s something in the world that could kill our ability to win and ability to do work or anything,” Valery Krasovsky, CEO and co-founder of Sigma Software, informed CNBC on the sidelines of the Web Summit tech convention in Lisbon.
Sigma, which has 2,000 workers primarily based in Ukraine, geared up its workplaces with diesel turbines and Starlink web terminals to permit workers to proceed working amid Russian shelling of important vitality infrastructure.
“Nothing could happen that would stop us delivering business, even in these conditions,” he added.
Sigma was one in every of 59 Ukrainian start-ups that attended the occasion final week. Ukraine had a notable presence at Web Summit, the place it sought help from the worldwide tech group to bolster its combat in opposition to Russia.
In 2021, Ukraine had a small sales space at Web Summit, Krasovsky stated. This yr, it had a a lot bigger stand, lit up in yellow and blue. It was surrounded by floods of tourists, with Ukraine’s first woman Olena Zelenska — accompanied by armed guards as she handed via the venue — amongst them.
Ukraine Vice Prime Minister Mykhailo Fedorov (proper) and First Lady Olena Zelenska (middle) attend the Ukraine sales space at Web Summit 2022.
Rita Franca | Nurphoto | Getty Images
On the opening night time, Zelenska made an impassioned speech calling on tech entrepreneurs and buyers to help her nation.
“You are the force that moves the world,” Zelenska, the spouse of Ukrainian President Volodymyr Zelenskyy, informed a packed viewers Tuesday.
Whereas Russia makes use of expertise for “terror,” the worldwide group has “technologies that can help, not destroy,” she added.
Russia has referred to as its invasion a “special military operation.” To Ukraine, nonetheless, it’s an unprovoked land seize aimed toward undermining its sovereignty.
Rebuilding with expertise
Ukrainan officers and entrepreneurs stated tech can be key in serving to the nation rebuild after Russia’s invasion.
Moscow started its invasion of Ukraine in February and the warfare has decimated the nation’s economic system. Its gross home product has shrunk by 30% to date this yr, in line with figures from the economic system ministry.
The World Bank estimates that Ukraine’s gross home product will contract 45% throughout the entire of 2022.
“People inside Kyiv and some other cities, they’re building, they’re making business, they’re still exporting,” Dima Shvets, CEO and co-founder of Ukrainian social media startup Reface, informed CNBC.
Shvets runs Reface remotely from London, the place he lives along with his spouse and their four-year-old daughter. Around half of his near-200 individual crew proceed to work in Ukraine. When the bombing begins, individuals use the basement of Reface’s Ukraine outpost as a shelter to cover.
Reface has rented a lodge for 50 individuals within the Western a part of Ukraine with separate infrastructure for electrical energy to allow them to proceed to work safely, Shvets stated. It has tried to “organically” relocate employees to Portugal, he added — however convincing them to go away has been tough.
“People have houses, families in Ukraine,” he stated.
In an interview with CNBC’s Karen Tso, Ukraine’s first woman stated it was “impossible to underestimate” the position of expertise in Ukraine.
“In this situation, it’s hard to talk about sustainability, technology, progress, since we’re just trying to hold on and live our lives as normal as possible,” Zelenska stated. “Still, we have lots of startups, and I hope that all the ideas presented at this summit can push us to victory.”
As winter approaches, nonetheless, Ukraine will want extra than simply IT funding to see it via the cruel months forward.
There have been studies of widespread energy blackouts lasting a number of hours throughout the nation. Around 40% of Ukraine’s vitality system has been destroyed, in line with the federal government.
“Ukraine needs more weapons, more military assistance,” Zelenska stated, calling particularly for air protection missiles.
Capital is coming
Ukraine’s IT business introduced in $2 billion of income within the first quarter of 2022, in line with the National Bank of Ukraine, a rise of 28% year-on-year regardless of the devastation brought on by Russia’s invasion.
The warfare has displaced tens of millions of Ukrainians, together with expertise professionals. Many have joined roles abroad. Once the preventing ends, it’s hoped that these employees will return.
Some corporations are ramping up hiring in Ukraine in a wager that the nation’s tech business will emerge stronger after the warfare ends.
Two months in the past, Lithuanian VPN software program agency Nord Security opened an workplace within the western Ukrainian metropolis of Lviv. The firm plans to rent 100 individuals there, in line with CEO Tom Okman.
“We think it’s time to build back Ukraine and we think the talent there is great,” Okman informed CNBC.
He famous Ukraine is dwelling to 1000’s of expert software program programmers and engineers. “Just think how many American companies have IT outsourcing” in Ukraine, he stated.
Several founders of billion-dollar “unicorns” come from Ukraine, together with Grammarly’s Max Lytvyn and Alex Shevchenko and GitLab’s Dmitriy Zaporozhets. Google, Samsung and Amazon even have analysis and improvement facilities within the nation.
But there are challenges past the warfare going through Ukraine’s tech ecosystem. The nation’s enterprise panorama remains to be rising. Startups within the nation attracted solely $22 million to date this yr, in line with Dealroom information.
“There are no big inflows in capital to support what we do,” Reface’s Shvets stated. “What we should do properly now is show more examples of entrepreneurship.”
Shvets stated the federal government in Ukraine ought to look to help native entrepreneurs within the nation with tax incentives and different pro-business initiatives.
There are indicators that sentiment from tech buyers to Ukraine is enhancing, although. Last month, Horizon Capital, a Kyiv-based VC agency, raised $125 million for a startup fund aimed toward backing Ukrainian founders.
SID Venture Partners, a enterprise fund arrange by Sigma and fellow Ukrainian tech corporations Ideasoft and Datrics, has to date invested in 10 startups with Ukrainian founders, Krasovsky stated.
It plans to lift a further $50 to $60 million from institutional buyers after elevating an preliminary $15 million in December 2021. “There’s huge interest,” Krasovsky stated.
Source: www.cnbc.com”