ukraine software tech
TRANSCRIPT
UKRAINIAN SOFTWARE TECH:Delivering value to global knowledge
Yevgen SysoyevManaging PartnerAVentures [email protected]
Ukrainian software tech is a big thing…
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#1 workforce of top notch software engineers within CEE
Increasing number of Fortune 500 companies directly or indirectly have software development shop in Ukraine
IT services exports account for ca. 40% of all exports from Ukraine to the US = #1 export item to the US
Ukrainian IT accounts for ca. 3% of total GDP and employs 100,000 professionals, including 50,000 software engineers
IT is the fastest growing sector in Ukraine and on track to transform the structure of the Ukrainian economy
A key element emerged in Ukraine over the last decade, despite all the odds with
governments, revolutions, neighboring countries, ups and downs in the economy
Despite all the odds, Ukraine software tech miracle is growing fast in 2014-15
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Yes, it could. Think again. Ukraine software tech industry is booming these
days and our country is increasing its role in the global knowledge economy
November 2014 December 2014
Ukraine IT sector delivers value to fortune 500 companies and beyond…
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IT COMPANYBASED IN UKRAINE SELECTED CLIENTS
Ever growing number of Fortune 500 companies, and beyond, directly or indirectly has a software shop in Ukraine
Software R&D in Ukraine as of highest world class quality and certainly very competitive compared to
rest of world
…to US & EU largest corporations, tech companies and startups
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IT COMPANYBASED IN UKRAINE SELECTED CLIENTS
Those international players who come for R&D in Ukraine, remain long term partners and happy customers
While many international companies even set up R&D centers in Ukraine
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America Europe Asia
100+ global companies has already established R&D centers in Ukraine
Ukraine can still offer large pool of engineers for new R&D centers
Ever growing number of Ukrainian startups become successful internationally
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VERTICAL SELECTED COMPANIES
Web
Mobile
Enterprise
Decade ago, to succeed in US market, one had to leave Ukraine. So many Ukrainians left to
US, Canada, Israel where they built large tech businesses
These days more and more talent stays locally while still succeeds in building global tech
business, particularly targeting US market
Appearance of first few Ukrainian “Unicorns” is on a horizon, I start the countdown…
With many of these startups generating 99% revenue globallyand having HQ in USA
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DESCRIPTION
REVENUESTRUCTURE
R&D OFFICE
HQ ANDSALES OFFICES
IoT company that develops
interactive pet monitor
systems and mobile pet lovers
community
Online marketplace for digital
images, the leading player in
emerging markets
A leading provider of
software-defined storage for
Hyper-V Microsoft
environments
99% - global markets
1% - Ukrainian market99% - global markets
1% - Ukrainian market
99,9% - global markets
0,1% - Ukrainian market
25 1 250 56
4 20 6
I’m personally proud to be part of these success stories out of Ukraine
Online, enterprise, consumer, mobile, IoT, payment, SaaS – all kinds of
international software tech companies emerge from Ukraine
Fast developing sector across all dimensions
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Increasing number of R&D centers in
Ukraine
Increased delivering of world class
software globally
2,000+ startups = Increased
internationally success
Continued VC investment activity and international
M&A activity
2X increase for MCap of EPAM and
Luxoft (R&D in Ukraine)
Tech sector is accelerating the transformation of Ukraine
Strong interest from strategic investors & venture capital funds to companies with R&D in Ukraine
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Acquired in 2012
Acquired
Acquired
Invested $100m
Raised followon capital
X2 stock growth of international companies with software shops in Ukraine
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EPAM+168,50%
LXFT+182,50%
S&P500 +32,03%
Change of stock price since July 5, 2013:
+169% +183% +32%
IT sector transforming Ukrainian economy
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IT services export ranking IT services export ranking
2014F 2025E 2014F 2025E
#1 #1 #7 #1-2
Share of IT in Ukrainian exports to the US stood at
40% in 2014
IT services is #1 export item to the US and will
remain so in 2025
Share of IT in total Ukrainian exports was ca 4% in
2014, while it was close to zero a decade ago
By 2025 IT services might become #1-2 export item
in the total export structure of Ukraine
…and already is part of global tech value chain
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#1 in CEE by # of developers and
$ volume
#1 size of working population in CEE
TOP 7 country withthe most engineering
graduates
TOP 3 by earningsof freelancers
at eLance-Odesk platform
Thanks to the strong technical education, Ukraine has superior human capital. Its workforce of 100,000
IT professionals is world class and fast growing
Ukrainian IT sector is playing an increasingly important role on in a global knowledge economy
Achieving so much more…together!
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Develop social, culture and economic ties among our countries
Increase cooperation within global tech development value chain
Jointly pursue next generations R&D for emerging technologies
Unleash our common tech companies to compete globally
Leverage our advantages to transform growth and wealth
Who are those 50,000 software engineers?
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What do they do in IT?
60%
Which city are they based in?
30%4%
3%Outsourcing Freelance
Product Startup
Roles
Manager Developer Q&A
14%
55%
11%
11%
44%
15%
8%
8%
LvivKyiv
Kharkiv
Dnipropetrovsk
Odessa
Which gender are they?
14% 86%
They have high education and speak 3-4 foreign languages, interact with the outside world
every day and help to build “new Ukraine” and its knowledge economy
With average age of less than 30 years and x5-10 higher salaries than its peers, they
form Western minded middle class who is putting pressure for reforms
Intro: being a global Ukrainian
UA50.org is a
network of global
Ukrainian doing tech
business. There are
many people like
myself
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Born in Soviet Union
Family movedto Egypt
Returned to Ukraineafter Soviet Union
collapse
Spent summersin Russia
Wrote first software:
game Tetris
Quit banking career& move to Singapore
Career asa banker
Felt in lovewith finance
Moved to Germanyto study math & write
software
Felt in love with math
MBA at INSEADbusiness school
Ukraine startupsgoing global
First early stageVC fund in Ukraine
VC in Ukraine
AGE
