In 2020, the total VC and PE investment volume in Ukrainian or Ukrainian-founded tech companies reached a record high $571 million. This data is provided by AVentures Capital, a major local VC firm, in its authoritative VC report published last month.
The volume of seed deals more than doubled year-on-year to $42 million. Meanwhile, the volume of Series A deals more than quadrupled to a $119 million, notes the report.
The better part of the funding went to a handful of global companies founded by Ukrainian entrepreneurs — and still relying, at least partly, on Ukrainian technical teams — but established in the USA. These companies are:
- airSlate ($40 million deal announced in 2021 but closed in 2020);
- Creatio ($68 million deal announced in 2021 but closed in 2020);
- GitLab (valued at $6 billion in November 2020 as it organized a $195 million secondary sale);
- Restream ($50 million Series A in August 2020).
Most Ukrainian funds focus on early-stage rounds, while international investors target high growth opportunities at the Series A and further stages.
The reports sees exits as a sign of maturation of a “product-oriented ecosystem:” globally-successful Ukrainian product companies “continue drawing attention from of strategic players, international buy-out funds, and generate returns for early backers.”
Several startups with Ukrainian roots — Gitlab, Bitfury and Grammarly — are now unicorns, the report points out. A few others are on the track to become new ones: these includes airSlate, Ajax, Genesis and People.ai, as well as software development company Softserve.
Domestic market leaders Rozetka (e-commerce) and Monobank (neobank) are on the same track, the report believes.
Finally, the Ukrainian tech sector showed a certain resilience in this crisis year, said AVentures Capital’s Yevgen Sysoev, who co-authored the report, in a previous exchange with East-West Digital News. “Most companies and sectors, including product startups and IT service companies, returned back to growth in Q3 and we saw a peak of tech investments in Q4. The last quarter of 2020 was the best ever for tech deals, and a number of companies are considering an accelerated path to IPO.”
The report also provides insights on the Ukrainian VC scene, the state startup fund USF, M&As in the field of software outsourcing, international R&D centers, and more.
- Click here to view this report on Slideshare