What’s it like to be a startup in Ukraine during the war and crisis?

Image copyright 2015 Jorge Mesquita. Jorge is a passionate professional photographer from Porto, Portugal. He left his office job of years to follow his passion and tell stories through his pictures.

The crisis in Ukraine has had a severe impact not only on the people in the country, but also on the local startup ecosystems, which were thriving before the war started. Since the situation in the country has become unstable, foreign investments have more or less halted.

What does the crisis situation mean to the startup community in Ukraine, will be the topic of a number of articles here over the next few weeks.

And, as always, for some parties, war and crisis mean disaster, for others, it’s a time of opportunity.

The crisis in Ukraine has had an incredible effect on its economy:

· hryvnia, the national currency, has lost one-third of its value;

· real estate prices have dropped twice as much (in USD);

· rental property has become 2.5 times cheaper;

· salaries have fallen by almost one-third;

· domestic goods prices have also decreased by 2 times on average (in USD).

The crisis has lasted for more than a year now and there are signs now that it is stabilising. The political crisis has come to its end and Ukraine has established a legitimate authority, recognised all over the world.

As for the conflict in the eastern Ukraine, it has been intense in a number of regions, accounting for 8% of the whole territory of Ukraine. The regions that are currently not under the government control equal to 4%. Therefore, the war has been contained in a small area. The remaining 92% of the country has been affected by the war to a much lesser extent and can be considered a safe place to build a startup.

At 603,628 square kilometres (233,062 sq mi) and with a coastline of 2,782 kilometres (1,729 mi), Ukraine is the world’s 46th-largest country (after South Sudan, before Madagascar). It is the largest wholly European country and the second largest country in Europe (after the European part of Russia, before metropolitan France). It lies between latitudes 44° and 53° N, and longitudes 22° and 41° E.

Given the fact that foreign investments don’t exactly ‘flow’ into Ukraine now, Ukrainian startups must become profitable as quickly as possible in order to survive, let alone thrive. There are a lot of examples of successful and advanced startups in Ukraine that are able to keep afloat even at the times of crisis and war, and we will talk about some of them in the following issues of this story.

When it comes to startups in biotech, healthcare and IT in Ukraine, it’s important to say that despite all the opportunities, these areas are not well developed at all, although the country is full of relevant specialists willing to work in serious projects.

On the one hand, there are 25 top universities providing the country with the whole range of doctors and specialists. On the other hand, in private healthcare, being not that developed, the demand exceeds the supply, since there is a fairly large class of wealthy people, who can afford the highest quality of medical care.

As for biotech, the situation is quite the same. The country faces an acute demand of advanced biotechnology solutions, as Ukraine is an agricultural country by its nature, and it has lots of opportunities in this dimension.

In terms of IT, Ukraine is already known as a world supplier of IT-professionals. There is a job market overflowed with IT-professionals who are eager to work. It’s not strange, as there are thousands of students with high IT education, graduating from more than 30 educational establishments every year.

It provides foreign companies the opportunity to hire top-ranked specialists for very low (comparing with the US standards) salaries. This is one of the reason that the outsourcing industry has been thriving in the Ukraine.

Read more about the startup community in Ukraine in the next issue.

This story is part of the “DeMinds | Startup Tales” publication on Medium. DeMinds | Startup Tales is a destination for everybody who is interested in reading from people in startup ecosystems around the world. If you wanna read more Startup Tales, subscribe to the DeMinds publication here: https://medium.com/deminds-startup-tales