Two years since Russia’s invasion, Ukraine’s startups soldier on

This weekend marks exactly two years since Russia’s illegal, unprovoked and brutal invasion of Ukraine. Despite overwhelming odds and continued hiccups in the supplies of Western aid to fight off Russia’s onslaught, the country and its tech startup ecosystem has literally soldiered on, becoming a case-study in resilience.

For instance, of the 511 tech companies based in Kharkiv before February 2022 — these days a city better known for coming under regular Russian bombardment — 500 are still operating, according to Kharkiv’s tech “cluster” organisation.

And tech companies in the West have rallied around the sector, increasingly working with Ukrainian tech firms on a range of initiatives.

This week Google launched its second ‘Google for Startups Ukraine Support Fund’ with a budget of $10M to support Ukrainian startups during 2024 and 2025. Selected Ukrainian startups will receive up to $200,000 in equity-free funding, as well as Google mentorship, product support, and $300,000 in Google Cloud credits. Since the war started, Google claims to have allocated more than $45 million in direct aid and $7M to support humanitarian efforts.

Since the war broke out, the scheme has so far provided 58 startups with $5 million in non-equity grants and $15.8 million in follow-on funding. Tech companies supported in this way have included, Mindly and Zeely. Zeely raised a $1M seed round last year.

Meanwhile, Estonian accelerator Startup Wise Guys launched Growth Ukraine, a programme for startups in Ukraine.

And the EU-funded project ‘Seeds of Bravery’ programme has five programmes to support Ukrainian tech startups with grants ranging from €10,000 to €50,000.

Last week the non-profit startup support programme UK-Ukraine TechExchange launched, specialising in defencetech and agritech.

The private pro-bono program mainly works with startups developing drones, UAVs, sound-based missile detection, counter-drone technology and drones for agricultural applications.

Ukraine’s tech sector is astoundingly resilient, and even growing.

A recent survey from the Lviv IT Cluster (“Adaptability and Resilience Amidst War”) which consulted over 7,000 tech specialists and more than 400 companies.

Ukraine’s tech sector has helped keep its economy afloat amid the war.

The tech industry contributed 4.9% (or $7.1 billion) to Ukraine’s GDP last year. In Emerging Europe’s IT Competitiveness Index, published in April last year, Ukraine took 12th place, rising from 14th in 2022.

The number of Ukrainians working in the tech sector has increased by over 7% (even as the wider economy shrunk by almost a third), reaching a total of 307,600 people, with 242,000 living and working in Ukraine, despite the ravages of the war.

Understandably, the number of Ukrainians working in tech abroad has grown by 20%, with the current figure standing at 65,000 compared to 55-57,000 last year.

Poland’s tech economy is becoming “Ukrainians abroad”.

Some 36% of Ukrainian CEOs plan to open new offices, 28% of them abroad, and the majority are choosing Poland as their second base of operation.

Ukraine is also exporting the technology behind its rapidly developing digital government. mRiik, Estonia’s latest digital tool, has been based on Ukraine’s Minister of Digital Transformation Diia app, which securely stores ID cards, passports and driving licenses digitally, as well as allows access to some public services.

The same Ministry of Digital Transformation also runs the Ukrainian Startup Fund, which has become the country’s largest angel investor, backing over 350 startups. Many of these have obviously pivoted towards defense and dual-use applications.

Launched in Spring 2023, the country’s defense tech initiative is called BRAVE1. This fast-tracks innovation in the defense and security sectors. It has funded over 400 projects, with almost 200 having also undergone live military testing.

Below, we present a selection of the latest news from Ukrainian-origin startups and tech companies.

• Preply raised a further $70 million in funding last year — a combination of debt and equity — to extend its Series C to $120 million. It now has 650 employees and 40,000 language tutors. It claims to have increased revenue by 10-fold since 2021, and recently set up a new office in New York City. It is providing free group language lessons to displaced Ukrainians, and charges no commission fees to any tutors based in Ukraine and more.

• Ukrainian software company MacPaw is