In 2023, Ukrainian technology companies demonstrated resilience, attracting $209 million in investment despite challenging conditions. The outlook for 2024 looks promising, with significant growth in deal volume in the first half of the year.
Venture market of Ukraine
Investment dynamics
According to a study by the investment fund AVentures Capital, in 2023, a slowdown in the decrease in the volume of investments in Ukrainian companies was observed to 11% per year. This testifies to the endurance of the industry in the conditions of war. The first half of 2024 shows signs of recovery: the volume of deals increased 4.1 times compared to the same period in 2023, reaching $283 million against $68 million.
Distribution of investments by sectors
In 2023, Ukrainian tech companies attracted $209 million. The distribution by directions looks like this:
- EdTech – 41% (about $85 million), including GoIT and Preply
- IT Services – 14 % (about $30 million), including Trinetix and Viseven
- Finance – 14% (about $29 million) , including Stroom and Fintech Farm
- Retail – 10% (almost $21 million), including Deus Robotics and Competera
- Entertainment – 7% (about $16 million), including Respeecher
- Other destinations – 14% (approximately $29 million), including Osavul and Haiqu
Largest investment deals
Five companies raised the most significant amounts:
- Preply – $70 million from a consortium of investors including Horizon Capital and Owl Ventures
- Fintech Farm – $22 million with the participation of Nordstar
- Dressx – $15 million from Greenfield Capital , Warner Music Group and others
- Viseven and GoIT received undisclosed amounts from Horizon Capital Growth Fund IV
Grant support and Military Tech
In 2023, Ukrainian entrepreneurs received $6.9 million in grant funds, mainly from USF, Brave1 and the European Innovation Council Accelerator. The new Military Tech sector attracted $6.7 million, of which $2.3 million was invested by Brave1. The company Osavul became the leader in this segment, attracting $1 million.
Market prospects
Ukrainian funds continue to increase their budgets, the amount of commitments reaches $532 million. Horizon Capital reached $350 million in its Growth Fund IV. The Ukrainian Association of Venture Capital has launched a Fund of Funds with an expected size of $300 million. 2 billion Potential candidates for unicorn status include Headway, BetterMe, Universe Group, Ajax, Restream, Welltech and Preply.
Glossary
- AVentures Capital - a Ukrainian venture fund specializing in investments in technology companies
- EdTech - educational technologies, a branch that combines education and technological innovations
- Preply - Ukrainian online platform for learning languages
- Horizon Capital is a leading investment firm focused on emerging markets
- Unicorn is a startup valued at over $1 billion
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Answers to the questions
What volume of investments did Ukrainian tech companies attract in 2023?
Which sectors received the most investments in 2023?
Which companies attracted the most investments in 2023?
How is the Military Tech sector developing in Ukraine?
Which Ukrainian companies have the potential to become "unicorns"?
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Discussion of the topic – Dealbook 2024: Ukrainian tech companies attracted $209 million in investments in 2023
AVentures Capital has published a study of the venture and IT market of Ukraine for 2023. Ukrainian tech companies attracted $209 million in investments, and the decline in volumes slowed to 11% per year compared to the previous period.
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Oleksandr
It is exciting to see how our technology sector continues to grow despite all the challenges. 209 million dollars of investment is impressive! 💪 It is especially pleasing that EdTech is leading the way. This shows that we are investing in the future.
Isabelle
Oleksandr, absolutely agree! I was particularly impressed that Preply attracted as many as 70 million. This shows the global potential of our educational platforms. Have you used Preply?
Hans
It is very interesting to watch the development of Ukrainian Military Tech. 6.7 million is just the beginning. I think this industry has huge potential for growth and innovation. 🚀 Does anyone know more about Osavul?
Maria
Hans, I heard about Osavul! They develop drones for the defense sector. Their one million investment is a truly significant achievement. And I'm also impressed by Dressx with their digital fashion technology. 15 million from Warner Music Group is something! 🎵👗
Giovanni
I don't understand this hype around startups and investments. All these new technologies only make life more difficult. It would be better to invest this money in something useful, and not in some virtual dresses or robots.
Oleksandr
Giovanni, I understand your skepticism, but these investments create jobs and stimulate the economy. For example, EdTech helps people learn new skills. And military technologies are now especially important for our country. Maybe we should look at it from a different angle? 🤔
Sophie
I'm surprised fintech only got 14% investment. Given the global trends, I expected more. Does anyone know why? Perhaps it is related to the specifics of the Ukrainian market? 🤷♀️
Piotr
Sophie, interesting observation! Perhaps this is due to the fact that many fintech projects have already reached maturity and do not require significant investments. But Fintech Farm with 22 million shows that the potential is there. I wonder how this will affect the banking sector of Ukraine in the future... 🏦💻