SAN FRANCISCO – The first Ukrainian Tech Gem conference was held in the heart of Silicon Valley, an event that on Sept. 18 showcased an emerging market’s technology ecosystem to more than 500 potential partners and customers.
In attendance were American and Ukrainian information technology firms, venture capital funds and startups. They came to hear a message that was as simple as a 140-character tweet: despite Russian military aggression and the tough economic situation, Ukraine has innovative potential, tech talent, and is open to cooperation.
Three stages ran simultaneously. The main stage held panel discussions, IT companies showcased their products and services in the exposition zone, and the smaller demonstration stage had brief presentations.
UTGem was privately funded and did not receive financial support from the government, said Igor Shoifot, chairman of Happy Farm and the U.S. representative of TMT Investments venture fund, who helped to organize the conference. Software developer EPAM, European Business Association, and U.S.-Ukraine Business Council were the other co-organizers.
Ecosystem’s two nuclei
The conference agenda combined two of the most prominent parts of Ukraine’s technology business: outsourcing software developers and players from the venture business infrastructure, including funds, business angels, startup accelerators and entrepreneurs.
The software developers — SoftServe, ELEKS, Ciklum, and EPAM — spoke first on a panel focused on the Ukrainian outsourcing business. Setting the tone for the whole 10-hour long event, Ciklum’s head Torben Majgaard reassured the audience that “the war has not disturbed business from the productivity point of view,” while the other panelists added that the major outsourcers in Ukraine still have more clients in the pipeline than they are able to handle.
In the next sessions, IT professionals discussed cloud technologies, innovations in digital production, venture capital, agile scaling of business, education technologies, as well as the growth stage of companies.
Software development in Ukraine is the only IT sector that is a bona fide industry. The 25 biggest companies employ more than 27,000 people in a $2 billion market. The venture part has a long way to go, speakers said.
The launching of UAngel, a network of affluent investors, is the latest positive development here. Talking at a panel discussion, the network’s chairman Nataliia Berezovska said the group’s task is to “educate our angels and de-mystify the process of angel investment.”
A traditional startup contest was held toward the end of the day. Out of five startups that gave three-minute pitches to judges, Petcube won three mentorship sessions with Happy Farm’s mentors. It is a gadget that allows pet owners to remotely play with their dogs or cats by using a laser pointer. In 2013, it raised more than $250,000 on Kickstarter, but is four months behind schedule on product delivery. Petcube co-founder Yaroslav Azhnyuk says that shipments will start in the end of October.
Attention to education
Speaking about how fast Ukrainian outsourcing software development companies are growing, Ciklum’s Majgaard said: “If I win a customer here today, I will go to Ukraine and hire a team of programmers from somebody else. There’s not going to be more programmers in Ukraine just because I get a customer, so we’re not helping Ukraine here.”
Majgaard places special hopes with the Brain Basket Foundation, an education initiative that aims to train 100,000 programmers in the next five years. Roman Khmil, Ciklum’s former chief operating officer, manages the initiative.
“Americans say, in 2020 the world will be short of a million programmers. If Ukraine brings in 100,000 people, everybody will still have a job. So stop promoting Ukraine, start producing programmers,” Majgaard added.
Grand plans
Organizers of UTGem are already planning for next year’s conference. It is expected to draw 1,000 attendees and will include an investment auction and other “involvement devices,” Shoifot added. He also expressed hope that much more local venture capitalists and angel investors will show up.
“Ukraine must show to the US successful startup cases which were created in Ukraine or with participation of Ukrainian co-founders. There are a lot of them, but only few know about “Ukrainian roots” of PayPal (Max Levchyn), Whatsapp (Jan Coum) or even Apple (Steve Wozniak). American investors should see that Ukrainian startups are oriented on the global market,” said the conference co-organizer, CEO and founder of Happy Farm incubator Anna Degtereva.
Andrii Degeler is the Kyiv Post’s information technology reporting fellow. Degeler has been covering the IT business in Ukraine and internationally since 2009. His fellowship is sponsored by AVentures Capital, Ciklum, FISON and SoftServe. He can be reached on Twitter (@shlema) or [email protected].
