Ukraine’s unstable economy, war with Russia, and a stubbornly high level of corruption could have led the country to economic disaster.
But Ukraine, as the words of its national anthem go, “is not dead yet.”
And in fact, the tough business environment is producing some robust and successful businesses, according to the participants of the “Ukraine’s Business Stars” panel at the Kyiv Post’s Tiger Conference at the Intercontinental hotel in Kyiv on Dec. 11 .
One of them, Kira Rudik, the COO of tech company Ring Ukraine, said she had become a “true lobbyist of Ukraine” in trying to convince foreign investors Ukraine isn’t all about Russia’s war, corruption and economic instability, but that it is indeed possible to create successful businesses here.
“People are scared of the words ‘war’ and ‘martial law,’” Rudik said. “They are scared of what could happen in Ukraine in a couple of years. They needed to be convinced that Ukraine is different.”
Rudik is persuasive, however, managing to convince the promising U.S. startup Ring to open a 500-person branch in Ukraine. Since doing to, the startup has gone from strength to strength. In February 2018, it was bought by U.S. tech giant Amazon for $1 billion.
“Our Ukrainian team was a good part of this deal, as the biggest engineering team is in Ukraine… and they are not a cheap labor force — these are the professionals that would be difficult to hire anywhere in the world,” Rudik said.
She said she was sure Ukraine’s IT sector demonstrates how Ukraine could develop as a country if in 2019 there were no war, and corruption was combated.
Andreas Flodstrom, who in 2012 came to Ukraine from Sweden with his business partner Gustav Henman to set up an IT firm called Beetroot, agreed. His company is now working in five Ukrainian cities and also operates a non-profit arm called Beetroot Academy, which teaches people to program.
Six years after coming to Ukraine, the tech businessman thinks starting a business in the country was “the best decision of my life.”
“Ukraine is a country of potential,” Flodstrom said. “The environment in Ukraine is much more dynamic than in Sweden. For Swedish businesses it is scary to work in such fast-moving conditions, but it suits me — I like Ukraine’s pace.”
While he sees that Ukraine still has economic problems and bad image on the global market, Flodstrom remains optimistic and is sure “as soon as Ukrainians get more confident, more business stars will be born.”
“Nobody should tell you what you can’t do,” he added.
Dan Pasko, a managing partner at investment firm Diligent Capital Partners, however, was less optimistic. His company invests a lot in agriculture, and though he sees the potential of this as well as the tech industries, he’s sure Ukraine’s economy will never grow and new businesses will be more of an exception than the rule unless it gets rid of corruption.
“With 2 percent GDP growth — which is nothing; and what I call a ‘bog’ — Ukraine will stay stuck in its development,” Pasko said, adding that it weren’t for corruption Ukraine would have better chances.
“If I were running for president, I’d have one promise to make — to tackle corruption,” Pasko said. “But of course, with the previous president, (Viktor Yanukovych), it was much worse.”
The Kyiv Post’s technology coverage is sponsored by Ciklum and NIX Solutions. The content is independent of the donors.
