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Ukrainian Startups and Venture Funds to Pay Attention to in 2019

2018 has been a record year for the Ukrainian investment market. There were more than $323 million dollars attracted by tech companies alone. Although the field is still in development, unique circumstances and exceptional startup ideas result in high popularity.

Now is a good time to turn attention to Ukrainian startups. While most investments are put into several biggest companies, investing in less known projects can potentially be more profitable. If you want to learn more about the most promising Ukrainian startups and venture funds in 2019, read further.

Top Seven Most Unique Ukrainian Startups

As the number of startups around the world (and in Ukraine specifically) is constantly rising, it is much more difficult to pick the ones that have the most potential. Fascinating innovative ideas can die out in infancy without a proper marketing, absence of specialists, or simply lack of funds. However, there also are great projects that are destined to be successful. Here are some of the most extraordinary startups to keep an eye for:

In the last decade, 3D printers have evolved from slow, impractical, and expensive machines into advanced tools available for a reasonable price. They have found their use in a variety of fields, including manufacturing, building, food production, and more.

Medicine is an industry where 3D printing has the biggest potential. Creation of a device that can produce human organs would save millions of lives. ADAM is the first step in this direction. Right now the project is focused on bone modeling and printing, which would not only improve some of the operation techniques but also allow upgrading the human body with the help of biopolymers that are stronger than natural tissues.

VR and AR are other technologies that became widely available in our everyday lives in the last decade. While there are ambitious plans for it to revolutionize education, medicine, and entertainment, there are more advanced ideas.

Funlight is one of such ideas. Simply put, it combines AR and VR experiences with the help of multiple projectors and motion sensors that track your movement and react to it. Right now, the prototype is focused on the entertainment. However, the potential uses for this kind of simulation are limitless.

In 2017, “fake news” was a word of the year according to a number of official dictionaries. It is no wonder – in our age of social media and fast news cycle, the disinformation spreads with impressive speed and efficiency. Ukraine has been a target of multiple fake stories, so it remains a pressing issue.

FakesRadar is a startup that aims to identify the fake stories and their sources on the network. While it is still a work in progress, the pilot version has already shown a lot of potential in both raising awareness and isolating fabricated and inaccurate stories. If you want to influence the state of the news industry around the world, you should definitely invest in this project.

With smartphones and tablets, the need for notebooks is basically gone. Right now, it is just a matter of preference and taste. Both info entry methods have their pros and cons. The notebook developed by a young team at Nuka unites the best of both worlds.

An Eternal Notebook is a reusable tool – you can easily erase any notes you don’t need. Furthermore, it is waterproof so it cannot be as easily destroyed as a generic notebook. What’s most important is that all your notes can be easily digitized and synchronized with a device of your choice.

With a global warning acknowledged an imminent danger by more and more countries every year, ecologically oriented startups are gaining more popularity as well. Renewable energy is one of the most actively expanding fields in the area, so let’s take a look at a promising idea related to it.

The blinds from this technovator serve as an effective generator of green energy. Furthermore, SolarGaps are smart blinds – their position can be regulated with a smartphone app and can be used to cool off your room on a sunny day or to protect your privacy at nighttime.

Another example of a successful startup, RAWR is a team of enthusiasts developing the smart collars for pets that connect to owner’s smartphone through LTE. Not only do they perfectly serve their purpose as a location tracker for a pet, they are also equipped with a number of other sensors, from temperature to activity tracker. It allows gaining information about the state of the animal’s health state. The collar is also designed to be a great fashion statement.

Collecting customer feedback is an important part of business improvement. When it comes to customer-oriented businesses (for example, service providers), it is crucial to get detailed feedback as often as possible. Unfortunately, tools for easy response gathering and analysis are quite rare.

Expirenza aims to change that. It is a great system to both identify the shortcomings and understanding what actually works. Furthermore, it is easy to use both for a business owner and for customers. It can be accessed from anywhere and provides wide variety of reports.

Major Ukrainian Investment Funds That Support the Market

As more startups arise, more companies that support them during different development stages appear as well. For example, DNA325 assists IT projects during R&D and recruitment phase. The most important companies we should mention, though, are Ukrainian venture capital funds. There are not that many local investment funds, but their influence steadily grows. The biggest companies in this field are:

is a fund that backs IT startups (especially at early stages). Their interests include VR and AR, machine learning, cloud storage, mobile-oriented startups, IoT, and others;

is the fund oriented towards early-stage tech company investment. They focus on digital health, SaaS, and online marketplace startups;

is one of the most active seed-phase funds on the Ukrainian market. Unlike other companies, their focus is narrower – advertising tech and SaaS.

This venture company prefers to support a startup after they’ve seen the initial traction and get the info on the team. The directions the company is interested in are advertising and digital marketing, AI, IoT, security, B2B and B2C;

established by Western NIS Enterprise Fund, invests in a wide range of small and medium local companies. Overall, they mostly focus on the idea and the team rather than a certain direction.

How to Interact with an Investment Fund

Most of companies, with few exceptions, at the founding or seed stage are funded by the people and firms within founders network. It is really hard for a first time entrepreneur to raise money doing ”cold outreach” to investors.

The leading venture capital funds investing at the late seed or Series A stage would expect number of things as large addressable market, early product market fit, x3-5+ annualized revenue growth or 15-25% month-on-month, working unit economics at least in one channel and understand how to sustain and scale that.

So I think a founder shall think differently on when it is time to talk to people who trust in him or her, or when the business and its metrics are good enough to start talking to a venture capital investors at all.There is a notion among local founders not to raise new money when the company reaches profitability and have clear unit economics.

I think most of them are trying to optimize current profitability and not pursue a path to build a much larger business that would have been possible with an external financing. I think this is still a distinguishing and limiting factor in the mentality between local and most ambitious ones from Silicon Valley.

Yevgen Sysoyev

AVentures Capital

Conclusion

As it is the case with most post-USSR countries, the startup and investment market in Ukraine is in the early stages of development. Europe-oriented politics, not very strict regulations, and abundance of original idea create a very suitable environment for both local and foreign investors.

As the market grows, it becomes harder to keep a hand on its pulse. The more choices there are, the bigger the risk that you’d make the wrong one. That’s why most investment funds consist of professionals. Additionally, they often require some sort of guarantee or testing. Overall, whether you’re on investing or receiving side of the business, you need to be careful and thorough with the choice of your partner.