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In 2022 there has been a lot of talk about Ukrainian founders who have started and grown their businesses abroad. However, there are also some top companies that were started in Ukraine, went public, and brought an incredible amount of ingenuity and products to the world.
Here is the breakdown of the top three Ukrainian companies on my list as of March 2022.
GitLab is an open core company that was launched in 2012 by co-founders Dmitriy Zaporozhets and Valeriy Sizov. The founding team was soon joined by Sid Sijbrandij who became a co-founder and CEO of the company.
Until 2014 the product was distributed via both a free and open-source software MIT license (Massachusetts Institute of Technology license) through its two versions: EE and CE.
“Open core” – a company that makes money by offering open source software to its users.
“Open source” – software that grants users copyright and ability to change the code within that software.
Today, developers can create, secure and operate new software through GitLab. The business has faced some severe competition from giants such as Amazon and Microsoft. It is telling that its competitor with a similar name – GitHub – was acquired by Microsoft in 2018.
However, despite that, GitLab enjoyed early success and growth, when it jumped from just 9 employees in 2015 to 350 employees in 2018. All 350 employees are also fully remote. During the pre-covid times it was highly unusual, even for a tech company. Whatever the reasoning behind it – it certainly seems to have worked.
In 2018 GitLab’s growth was fuelled by a $100 million round that it raised form outside investors, at a valuation of $1 billion. Perhaps Microsoft’s acquisition of their competitor helped stir the investment pot a bit, who knows? The company is considered to have become the first Ukrainian unicorn at the time. It IPO-d in October, 2020.
Unicorn – a company with a valuation above $1bn.
Since then the company’s performance has declined, especially with it losing out to GitHub (who, to be fair had a head start, launching in 2008). Over 82.8% of Stack Overflow developers surveyed indicated that they use GitHub over GitLab.
Despite the above, this is still quite a remarkable business. As of January 2022, GitLab has about 30 million registered users and 1 million active license users.
Let the community build itself…by telling them about it. In 2012 Sid (the CEO), according to GitLab itself, asked Hacker News community if anyone wanted to sign up to the beta – and hundreds of users did. This gave GitLab its first adopters and the necessary boost.
March 2022, invasion of Ukraine by Russia.
The company came out and spoke strongly (unsurprisingly) against Russia’s invasion of Ukraine in February 2022. As of 22nd of March 2022 it has suspended new business in Russia and Belarus. As per the statement on the company’s website: “The Sijbrandij Foundation will match donations from GitLab team members to the following charities: UNICEF, Save the Children, Médecins Sans Frontières, and Amnesty International to help people affected by the military invasion of Ukraine.”
Ah yes, Grammarly, the bane of my existence. Anyone else tired of seeing their ads on YouTube videos all the time? Well, as annoying as they might be, the company is a juggernaut.
Grammarly was founded by Max Lytvyn, Alex Shevchenko, and Dmytro Lider in 2009. Prior to that the three musketeers created a program called “My Dropbox” which checked works for plagiarism.
My Dropbox was sold successfully for an undisclosed sum to another company, Blackboard in 2007, after reaching over 2 million students individually and through 800 universities. The money from the sale was used to launch Grammarly.
Grammarly is a spell-checking app (hence the clever name). It corrects punctuation, ensures writing clarity and that it is engaging for the end-user. One of Grammarly’s latest developments has been an AI machine-learning driven solution that provides suggestions for when mistakes are made/while the user is typing out a sentence.
The company was started with the view to teach others English. It was also intended as enterprise software for universities. However, the founders quickly realised that:
a) universities took too long to agree to buy the software; and
b) the target audience could be anyone writing in English, not just non-English speakers.
That’s how Grammarly’s pivot came about.
To help solve the problem with finding errors correctly, the founders recruited…their users. The latter could vote whether the correction was suggested “at the right place and at the right time” or not. That feedback would then supplement the cloud data base that Grammarly used to “make the decisions”.
As the result in a couple of years since its launch, the company’s cloud database had over 250 basic rules and 10,000 sub-rules that applied in different contexts.
As of November 2021, over 30 million people use Grammarly on a daily basis. The company has been a huge success not only from a user standpoint but also in terms of its financials. In 2021 Grammarly raised $200mln at a $13bn valuation.
Grammarly’s team built up their presence through a fairly simple and methodical approach over the years – they optimised the tool for one application at a time.
As a result, it was able to integrate with such giants as Gmail and Word Office through offering Chrome extensions and plugins for the end-users. This gave Grammarly access to millions of people who use the former solutions on a daily basis.
March 2022, invasion of Ukraine by Russia.
While the company was originally based in Kyiv, its headquarters are now in San Francisco. At the same time a number of its team members are still working out of Ukraine. After the February invasion in 2022, Grammarly team has come out to state that it will “donate all of the net revenue earned from Russia and Belarus since the war started in 2014 through 2022 to causes supporting Ukraine”.
Preply was founded in 2012 by Kirill Bigai, Dmytro Voloshyn, and Serge Lukyanov. (Another trio, seems to be a trend, doesn’t it?). The company’s website, https://preply.com/ was relaunched in 2013.
The platform connects language tutors with students around the world. The tutors can create their own lesson plans, while the students get access to various learning interactive tools. Machine learning was used by Preply’s founders to help improve the “matching”.
In 2020 following the pandemic, despite being in competition with some giants such as Duolingo, Preply reported accelerated user growth (which slowed in 2021, following the world’s recovery from the pandemic). The company’s USP: Preply’s team takes a “native tutor” approach, unlike its competitors. It claims that live tutoring with a native speaker is better than Duolingo’s gamified approach. Whether that is the case or not, time will show.
Talk to your users. According to Preply’s founders the hardest thing for the three Ukrainians was communicating with the English-speaking users. The following steps were key to relaunching the platform, after trialling a different idea and website in 2012 on the U.S. market.
1. Customer development was the key to having that product-market fit. Working closely with end-users and taking their feedback onboard.
2. Customer acquisition cost was incredibly high too, because the product difficulty was too high and marketing wasn’t well thought through. Unlike what most online gurus tell you, here, the team took marketing first – product second approach. (i.e. develop the product as users flock to you).
3. Launching the product in the local market (Ukraine), instead of the lucrative, but highly competitive U.S. market was key to attracting “cheap” users to the platform at the early stage. Use and target your local audience at the start.
Preply is not as big as the above two behemoths, however it also went through a highly successful Series B round, raising $35mln in March 2021.
March 2022, invasion of Ukraine by Russia.
While the company was originally based in Kyiv, its headquarters are now in San As of March 2022, the company intends to send an equivalent of all proceeds from Russia to the National Bank of Ukraine to support the humanitarian efforts in the country as the crisis unfolds.
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