Ukraine is becoming attractive for investors, and its national IT industry is expanding. Sergey Kartashov, the Senior Partner at Roosh, elucidates prerequisites for the development of a favorable investment climate in the country.
During the last years, the Ukrainian IT sector has been obtaining funds from the investors successfully: for example, in 2018 startuppers raised $345 million, the next year the number increased up to $544 million, and in 2020 the amount was $571 million. That was associated primarily with a launch of promising IT startups (Grammarly, Preply, Reface, and some other giants) that gained popularity quickly, Sergey Kartashov says. Considering that entrepreneurs and investors like to experiment, authors of brilliant ideas easily obtain funding.
Technology company Roosh and its venture studio Pawa are focused on Artificial Intelligence (AI) and Machine Learning (ML) projects. Sergey Kartashov explains that there is a communication platform called AI House that unites leading Ukrainian AI and ML specialists and founders of innovative startups.
Despite intensified efforts of institutions to prepare IT specialists according to market demands, the educational system does not keep pace with the market needs. To improve the situation, big IT companies started to organize courses and training. These educational programs usually include not only coding but also practical aspects of managing a startup. Specialists graduate with a clear understanding of how to transform their ideas into a successful business.
Investors are looking for startups founded by qualified managers that know what to do with the money they wish to receive. Sergey Kartashov stresses that the managerial skills of a founder can become a criterion that plays a decisive role in the investor`s decision. If the investor doubts the startup founder, there are no chances for investing in the project.
According to Sergey Kartashov, the development of the IT community in Ukraine will lead to a higher number of creative ideas, promising startups, and skilled managers ready to achieve ambitious goals. More quality projects mean more money invested in them.
On the other hand, this may lead to changes in investors` behavior. Perhaps, American businessmen are guided by a fail-fast system. Investors assume that projects may fail, and they start to invest in many projects waiting till one of them wins. “From a million experiments, there will come off a new Apple, Amazon, or another giant, the one that will become the new key driver of developing entire industries and will recoup all the investments that “did not make a hit,” says Sergey Kartashov. He continues: “With the development of the IT ecosystem, community, and a competent approach to education, there will be more quality projects.”
In conclusion, the speaker raises the issue of negative circumstances that worsen the investment climate in the country. Ukrainian local legislation system and the absence of a comfortable tax system distrust investors. To improve conditions, Ukrainian authorities are working on Diia City regime for IT companies, Sergey Kartashov notices. This regime will include tax preferences for IT businessmen and a simplified procedure for foreign investors that plan to enter the local market. Probably, these measures may positively affect the development of startup and investment areas.