Tech in Ukraine after two years of war

Tech in Ukraine after two years of war
Two years ago Russia invaded Ukraine and in that time, the country’s already booming tech sector has adapted and changed rapidly. In 2022 it was service led, providing IT development for companies outside its borders. Now though things have changed significantly and not only are the tech savvy helping the war effort, but many entrepreneurs are also looking to the future and planning on rebuilding a Smart Ukraine. Iryna Volnytska is the President of SET University, which was set up just a week before the war started. It’s now providing training for many women who hope to work remotely in the tech sector and it’s introducing undergraduate degrees that can be undertaken in other countries before students return to Kiev for the final year.  We also speak to Bhaskar Chakravorti, Dean of Global Business at The Fletcher School at Tufts University in the US who has  been researching the digital economy in the Ukraine.

The programme is presented by Gareth Mitchell and the studio expert is Angelica Mari.

More on this week's stories
SET University
Imagining a Digital Economy for All

Chapters

• 2:15 A new University for Ukraine
• 17:15 Ukraine's tech infrastructure key to its tech sucess

Transcript

00:00:00 Gareth Mitchell 

Hello, it's Gareth here. Welcome along to somewhere on Earth. We're in our studio here in London. And we also do have another voice that you're about to hear from Sao Paulo in Brazil. You might be able to guess. 

00:00:10 Gareth Mitchell 

Who it is. Here we go. 

00:00:18 Gareth Mitchell 

Yes, joining me today of course, is Angelica Marie over there in Sao Paulo. How's it going over there, Angelica? Have you recovered from your adventures in the Amazon? 

00:00:28 Angelica Mari 

Yeah, just about, Gareth, I I got dengue fever. 

00:00:33 Gareth Mitchell 

No, no. But when you say. 

00:00:35 Angelica Mari 

Yeah, it took it took me a while to to recover, but. 

00:00:40 Gareth Mitchell 

It word that's nasty. 

00:00:41 Angelica Mari 

I managed in the end. 

00:00:44 Gareth Mitchell 

Gosh, ohh, that's quite often. You just come on. You'll you'll say something in quite a kind of, you know, conversational, underhand kind of way that will be a bit shocking or astounding. And that is one of those things. Gosh, you've had dengue. That's how awful for you. Anyway. I'm sorry to hear you had that and. 

00:01:00 Gareth Mitchell 

I'll, I'll, I'll. 

00:01:01 Gareth Mitchell 

Still, treat you gently in this edition. I think it's probably about right. All chivalry there we are. Alright, let's get on with the show. 

00:01:04 Angelica Mari 

Thank you, Gareth. She's such a gentleman. 

00:01:06 Angelica Mari 

I really appreciate it. 

00:01:15 Gareth Mitchell 

And coming up in this edition. 

00:01:19 Gareth Mitchell 

This week sees the 2nd anniversary of Russia's fullscale invasion of Ukraine, now one of the many places to look for resilience in this country that's taken and is takeing such a pounding is, of course, in the world of technology. 

00:01:34 Gareth Mitchell 

Before the conflict, Ukraine was already well known for having a thriving tech sector. But since 2022, despite the destruction, despite many people having left, and despite men being called up to fight. 

00:01:47 Gareth Mitchell 

There is still a. 

00:01:47 Gareth Mitchell 

Thriving tech scene in that country. At least we're about to find out how thriving it still is. We're going to assess that. 

00:01:55 Gareth Mitchell 

Scene. And also we're going to hear about the new university in Ukraine where the kind of start up mindset and it's been taking shape since 2022. It's all right here on the Somewhere on Earth podcast. 

00:02:13 Gareth Mitchell 

Well, well, literally a week before that full scale invasion, a new university had just established. So what a time to start such a venture. This is the SET university where SET stands for science, entrepreneurship, technology. 

00:02:31 Gareth Mitchell 

The tagline is reinventing higher education in Ukraine to empower future tech innovators, to put it mildly, SET university has certainly had to pivot given the situation. In fact, degree programmes have swung towards cybersecurity and defence tech. Not surprisingly.. 

00:02:47 Gareth Mitchell 

More now from the university's president, Iryna Volnytska. 

00:02:54 Iryna Volnytska 

For US technology, it's our only option because if you work in tech, you can work remotely. You can work in the bomb shelters like anytime you want. And we managed to work with the starlings with generators etc. 

00:03:08 Iryna Volnytska 

And if you work in traditional industry conventional industry, you need like spaces, devices, a lot of things and a huge number of traditional industries were physically ruined, so they can't do it in a digital way. Also, we have a lot of clients outside of Ukraine and when the war started, I know that a lot of outsourcing companies. 

00:03:29 Iryna Volnytska 

They contacted all all their 

00:03:31 Iryna Volnytska 

Clients and asking for for their contracts from the Russian outsourcing companies. That is exactly what helped them for the first year because we still like there were a lot of people, a lot of companies who wanted to help Ukraine even to earn money in such a way like, so they provided Ukrainians with the contracts. 

00:03:51 Iryna Volnytska 

When the war started, we launched the courses the the courses for people who want to switch from 

00:03:59 Iryna Volnytska 

Traditional industry to tech industry and like in two weeks we received like 5000 applications and after us, the Ministry of Digital Transformation, they also launched the course for the first in the history not I think not only Ukrainian history but they had more female  

00:04:18 Iryna Volnytska 

applicants that male, because really people just need a new job. 

00:04:22 Iryna Volnytska 

And the only job that you can find in Ukraine, it's only in tech because tech is still keep growing. 

00:04:29 Gareth Mitchell 

Which brings us to the SET university then. So tell us about the university. What is the the SET university? 

00:04:38 Iryna Volnytska 

I registered the legal entity only one week before the war, so our students, they create a startup instead of writing thesis. But the war started. 

00:04:48 Iryna Volnytska 

And in the best traditions of startups, we pivoted a couple of times.  For us actually, it was the question of survival. 

00:04:56 Iryna Volnytska 

Right now, we want to respond to the most critical issues that are happening in Ukraine and as a university, we need to teach. So when the war started, we cancelled our like master degree or like degrees, all our plans and we started to provide people in Ukraine with short term courses because we understood that 

00:05:16 Iryna Volnytska 

it's not only the physical war, but it's also a digital war. It is a war of technology and 

00:05:23 Iryna Volnytska 

Ukraine will be on the frontline of cyber security developments defence stack for many years, so we started the short courses for cyber security. We received like 5000 applications so we taught just like ordinary people from traditional industries how to join tech. 

00:05:43 Iryna Volnytska 

And then we also partnered with different organisation like only like to teach people 

00:05:50 Iryna Volnytska 

some jobs like for beginners in technology. Right now actually we came back to our initial plan. We launched Masters degree. Our mission was about innovations, about startups, etc. But what we saw with our students that they want to create defence tech startups, the majority of them they want. 

00:06:10 Iryna Volnytska 

to contribute to the defence stack from investment investments perspectives that all investors that are coming to Ukraine, they are really very interested interested in defence stack. 

00:06:21 Gareth Mitchell 

But you know, completely understandable at a time like this. 

00:06:25 Gareth Mitchell 

And it's a fascinating model because you're partly a startup and at the same time you're an institution of higher education. You're recruiting undergraduates and and you just said masters’  students there. So. So tell me about that unique vision then to create a university based on a startup culture. 

00:06:45 Iryna Volnytska 

It was from the beginning. My team and me became from business, so we are not from academia and maybe sometimes it's a problem. Sometimes it's good, but we try to combine 

00:06:55 Iryna Volnytska 

all our business approaches that we learned from business environment, from startups, that's why we know how business works, how startup works, the technology is moving faster than you can write a book, for example for the students.  That's why we decided that we also need to move fast in education and 

00:07:15 Iryna Volnytska 

Right now in Ukraine, you don't have a choice. You just, you can't plan anything. I mean, because you don't know what is going to happen tomorrow. That's why we we try to work in the start up mould,  

00:07:28 Iryna Volnytska 

gathering all best practises from all over the world. We have partnerships with different universities from all over the world because everyone wants to help us, like to teach us to support us. But in terms of education right now it is super hard to plan something on long term perspective. 

00:07:48 Iryna Volnytska 

Personally, me and my team, we believe that education is our future because for tech sector growth we need educated talents and right now we we experience the biggest brain drain in the history of Ukraine. 

00:08:02 Gareth Mitchell 

And and of course it must be very challenging to think into the long term given the predicament in which Ukraine finds itself. And I know that you're planning to launch undergraduate programmes in the next year, maybe the next year or two, but how will students sign up for an undergraduate programme if they're not entirely sure that there's going to be a university at the end of it to award them a degree? 

00:08:29 Iryna Volnytska 

Our first bachelor degree will be next year and it will be very, very, very unusual bachelor degree because what we saw from the previous year is that there are no children in Ukraine, like 6 million of refugees, majority of them, it's women who left with children. 

00:08:48 Iryna Volnytska 

All these women, they reported that they do not plan to come back to Ukraine with their children. What we want to do at SET university, we want to. 

00:08:59 Iryna Volnytska 

choose the countries with the biggest number of Ukrainian refugees all over the world, like in Poland in England, and like in Berlin and Silicon Valley. And for the first semester we will teach, for example, in Poland, for the 2nd semester we will teach in Berlin, for the third semester we will teach in. 

00:09:18 Iryna Volnytska 

England, then in like in Silicon Valley, etc. And for the last semester we want to bring all these children back to Kiev and teach them in Kiev and to show them 

00:09:30 Iryna Volnytska 

that there are opportunities in Ukraine. So there are a lot of things that you can do in Ukraine. We will help them to attract investments for their startups, for their diploma work. And we hope that in this case they will see that there are really like plenty of opportunities in Ukraine and they will stay and help us to rebuild the country. And all this rotation we will teach in the 

00:09:51 Iryna Volnytska 

big tech offices, so like Facebook, like Google, they are able to provide their offices for our students so we can teach our students in their offices and the like we believe that it also will help us 

00:10:04 Iryna Volnytska 

to bring all these international expertise to Ukraine and to reduce this skills gap between business and academia, and like at the end, we will bring everyone back home. 

00:10:19 Gareth Mitchell 

That is Iryna Volnytska. And there's more from her, by the way in the subscription, the podcast extra version. So Angelica, you've actually been speaking, haven't you, recently to Ukrainian tech founders,  

00:10:32 Gareth Mitchell 

as you've been finding out how they've been dealing with and in some cases thriving within this situation, So what have you found out on your journalistic travels? 

00:10:45 Angelica Mari 

Yeah, I I recently wrote a piece about how Ukrainian tech entrepreneurs are operating in this war scenario, and it was a bit of a look back considering the two years since the the full scale invasion began. 

00:11:05 Angelica Mari 

I was actually interested in hearing what the motivations of these founders, regardless of their decisions to stay or to leave. I wanted to hear the, both sides of the the story without making it look like there's a 

00:11:25 Angelica Mari 

right or wrong choice in this case, the point is that these are all tough decisions, right? 

00:11:31 Angelica Mari 

And and I wanted to hear how they've been operating on a daily basis, their dramas and everything, how they had to adapt. And it was really fascinating to hear them. It is a real story of  

00:11:52 Angelica Mari 

Nothing more than with pure resilience really, to navigate through total uncertainty in in chaos. 

00:12:03 Gareth Mitchell 

And of course, you know, business is hard at the best of times, let alone these, which are arguably the worst of times. 

00:12:08 Gareth Mitchell 

So did you encounter people who had started companies since the war started? Since this full scale invasion started? 

00:12:20 Angelica Mari 

What Iryna was referring to is quite real from what I've heard, tech sometimes is the only option, and particularly to start a company. 

00:12:34 Angelica Mari 

It is the only option. I spoke to someone who interestingly was selling Russian software to Ukrainian companies and he immediately ended the relationship with this company 

00:12:53 Angelica Mari 

as soon as the war began, for obvious reasons, 

00:12:57 Angelica Mari 

UM. 

00:12:59 Angelica Mari 

But then he started to, he started to consider his options and started the company. Finding a job was hard, so starting his own company became the the the best option, and it is real like, 

00:13:19 Angelica Mari 

they they have to operate in really precarious situations with. 

00:13:27 Angelica Mari 

unstable mobile connectivity, sometimes no power, so they're having to adapt to all these circumstances. 

00:13:37 Gareth Mitchell 

Yeah, that seems to be a theme that's coming up time and again when we talk about innovation in Ukraine, it's just adaptability that you know, these businesses have no choice. And what about those who have left? Did you get a sense of people leaving Ukraine or even keeping their business where it is in the country but leaving if they if they're able to anyway, leaving the country themselves? 

00:13:58 Angelica Mari 

Yeah, some people choose to do so. Chose to do that beautiful for for reasons, including a personal safety, but also to avoid being drafted into the army in the case of men, but also to ensure they were providing a 

00:14:18 Angelica Mari 

stable service to their customers, because oftentimes we're talking about global businesses. 

00:14:26 Angelica Mari 

And it's quite tough because many of these founders had to sort of build the plane as they were flying it, meaning globalise their workforce. Many of these companies were entirely Ukrainian and adapt their infrastructure as we were discussing just now. 

00:14:46 Angelica Mari 

Also shift the legal headquarters and then deal with all sorts of aspects to continue to attract funding because investors were not really willing to take risks especially at the beginning. 

00:15:03 Angelica Mari 

So yeah, a  

00:15:04 Angelica Mari 

lot of adaptation taking place and also it's particularly difficult to be a founder based outside Ukraine when a lot of your staff is still in the country. So you have companies where they 

00:15:22 Angelica Mari 

Fully embrace the 

00:15:25 Angelica Mari 

either hybrid or remote models, but you had uh scenarios where half of companies workforce was still based in Ukraine and half decided to leave, so they really had to to to change  

00:15:48 Angelica Mari 

management mindsets and working models to to adapt to the situation. 

00:15:54 Gareth Mitchell 

Yeah, sure. And so finally and and briefly on this section, then what about are are people being encouraged to get back home? Are you getting a sense that that maybe those who left are really keen on going back or will they now stay put and maybe indefinitely outside Ukraine? 

00:16:10 Angelica Mari 

Some of the people, again there is, there's no right or wrong answer on this and a lot of people are just taking each day as it comes. 

00:16:23 Angelica Mari 

And some people moved elsewhere, and they rebuilt their lives and they they have new realities right now, but 

00:16:37 Angelica Mari 

most of the people I've been speaking to, the Ukrainians I have been in touch with over the last few months. They all want to. 

00:16:44 Angelica Mari 

The the the ones that based outside Ukraine at the moment, they want to return to that country because they really believe that tech will be key to rebuilding Ukraine after the war ends. 

00:16:58 Gareth Mitchell 

That's encouraging to hear, Angelica, thanks very much. All right. Now someone else who's been taking an interest in the state of innovation in Ukraine is Bhaskar Chakravorti. He's Dean of Global Business at Tufts University in the United States. 

00:17:16 Gareth Mitchell 

And Baskar is also chair of a research initiative called Digital Planet, great name, and that explores the impact of digital innovations around the world. Since 2022, he's been following several Ukrainian founders and entrepreneurs, and says that Ukraine's tech infrastructure that had been prepared since the annexing of Crimea 

00:17:37 Gareth Mitchell 

in 2014, has been key to the tech sector's growth today. 

00:17:43 Bhaskar Chakravorti 

The infrastructure was a critical part of the story. For one, the Ukrainian industry and the government had already plans in place for building it, redundancy in the infrastructure. So this goes back to the 2014 invasion of Crimea, where they anticipated. 

00:18:03 Bhaskar Chakravorti 

You know Russian invasions, and they anticipated that one of the first things that Russia would do was take down the Internet. So most of the companies we spoke with actually had two to three different ways to get on the Internet. If the first route went down. 

00:18:19 Bhaskar Chakravorti 

And for some of them, they had to use Starlink, Elon Musk's project, but most of them actually didn't even use Starlink. They had their own redundancy built in. So that infrastructure was critical. Another part of the infrastructure was critical was the fact that the the Ukrainians because of this  

00:18:39 Bhaskar Chakravorti 

Diia app that people had already got on their on their phones it was a great way for them to connect to a number of different government assistance programmes and then that Diia App was during the war 

00:18:52 Bhaskar Chakravorti 

adapted for a variety of war related efforts, such as there were job postings. So if you were displaced, there was a bulletin board that could say OK, here is a remote job that you can get as a school teacher because of course children won't go into school. So you could teach, you know, kids, you know, all kinds of subjects, 

00:19:12 Bhaskar Chakravorti 

or you could get some other job as an IT engineer, or if a a company needed, you know, new coders and programmers, you could post on that bulletin board and this bulletin board was essentially an outcome of a government app that had been provided. 

00:19:26 Bhaskar Chakravorti 

And then there were a variety of other apps, such as citizens could post videos and pictures of oncoming Russian tanks, or other military movements in their area so that that information could be collected, you know, by the ministry. And they could, you know, make plans accordingly. So there is both. 

00:19:46 Bhaskar Chakravorti 

the hard infrastructure of the  

00:19:48 Bhaskar Chakravorti 

Internet and this applications infrastructure on people's phones, which was really a a spectacular orchestration of what I would call the digital public infrastructure of Ukraine, that that worked beautifully and it worked for normal circumstances and it certainly has worked in a crisis situation. 

00:20:08 Bhaskar Chakravorti 

And on on top of all that, the government provided tax breaks for small and medium businesses and IT businesses were a critical part of that. 

00:20:17 Gareth Mitchell 

I suppose we should be aware of not painting too much of a rosy picture about what's going on. You know, despite, you know, it's amazing, adaptable collaboration, you know, very adaptable workforce resilience that seems to be built into much of the system even before the full scale invasion. Ukraine having highly educated 

00:20:37 Gareth Mitchell 

people so much going for it and the tech sector, 

00:20:40 Gareth Mitchell 

and yet, at the same time, its economy clearly has been hammered. You know, it's relying on the likes of the European Union and the United States Congress to argue their way into some kind of multi billion dollar financial aid for the country. Ukraine 

00:21:00 Gareth Mitchell 

Is in very bad trouble. It's suffering greatly, of course, from brain drain. If we want to talk about talent. So just to give a balanced picture about how 

00:21:09 Gareth Mitchell 

what you've come 

00:21:11 Gareth Mitchell 

away thinking about you, Ukraine as you go through doing this research. Where are we on a spectrum from? Look, it's really grim. It's a basket case all the way up to. Yeah. You know, actually there's still a lot going for this country and it's tech sector. 

00:21:24 Bhaskar Chakravorti 

There's a lot going for this country. I've spent two years of this last phase of a war which started long before 2022, and here is this country that has essentially fought and defended itself and continues to do so with, you know, varying degrees of support from outside Ukraine. 

00:21:45 Bhaskar Chakravorti 

When I think about the different ways in which it mobilises defence, the first thing that one thinks of is nothing to do with technology. It's just got to do with people. It's the human spirit. In the absence of which none of this would have happened and Ukraine would have just tumbled like a row of dominoes. But the tech industry and the tech sector 

00:22:05 Bhaskar Chakravorti 

really has made a difference. So if you think about that first phase, you know from 2022 to 2023, the Ukrainian economy collapsed by about 30%, which is kind of what everybody was expecting. 

00:22:18 Bhaskar Chakravorti 

And it's two major exports, agriculture and and and and commodities. They collapse too, because the ports from which these commodities and and grain would have to leave were blocked. 

00:22:29 Bhaskar Chakravorti 

But as long as the Internet was functioning, the third largest export which has IT services, continued to function. And it actually grew. It grew by 5% in that first year. We haven't seen the numbers for the next year, but from what I can tell, it has continued to grow. So it's a $7 billion industry, which is spectacular. It's amazing. 

00:22:50 Bhaskar Chakravorti 

So when I think about the role of technology in this Ukraine war. 

00:22:54 Bhaskar Chakravorti 

It is quite humbling to not only see this as a potential growth vector during a devastating war which has almost never happened before in previous wars. But technology also was critical in Ukraine's defence when I kind of go back to, you know, how this human spirit was 

00:23:13 Bhaskar Chakravorti 

mobilised. I would trace this back to the smartphone videos that President Zelensky had of himself standing in recognisable areas of Kiev alongside his cabinet, and kinda saying I'm here, you know, we are. The administration is functioning and that gave so much of a boost to everybody in the country and that was enabled by technology. 

00:23:35 Bhaskar Chakravorti 

So from something as basic as that to an entire sector and industry, you know, keeping the economy alive and and and growing in certain parts, I think is a a really humbling and at the same time really inspiring use of digital technologies. 

00:23:55 Gareth Mitchell 

Right. That was Baskar Chakravarti. So, Angelica, what is your assessment of the kind of state of the wider economy or certainly in this context, the tech sector in Ukraine after what has been these two very, very difficult years? 

00:24:14 Angelica Mari 

Yeah, despite all all of that's been going on, the the entire tech ecosystem is very positive about what the future holds. 

00:24:27 Angelica Mari 

Tech is Ukraine's most significant export, but you also have to consider the bigger picture. Ukraine's overall export value fell by nearly 19% last year compared to 2022, and that was the sharpest decline in the last 10 years. 

00:24:47 Angelica Mari 

So things are challenging for them, but we've been discussing this for the for this whole episode, is how adaptable these entrepreneurs and 

00:25:01 Angelica Mari 

and professionals are and what we see is a shift to from services to products. So it was quite hard for companies to sell services provided out of Ukraine because customers didn't want to take the risk.  

00:25:21 Angelica Mari 

So what founders have been doing is shifting really quickly, shifting their business model or diversifying to to incorporate products into their unique selling proposition, so. 

00:25:37 Angelica Mari 

what people have been telling me is that 

00:25:40 Angelica Mari 

their products will continue to to grow very strongly and their learnings over the last two years will mean that these will be more resilient, profitable and stronger companies in the years to come. 

00:25:58 Gareth Mitchell 

All right, Angelica. Thank you. That's where we'll leave it. Angelica Mari there. 

00:26:03 Gareth Mitchell 

Joining us in Sao Paulo, let's do it again in a few weeks. Angelica. 

00:26:07 Angelica Mari 

Yeah, let's do that. Thank you. 

00:26:08 Gareth Mitchell 

Loved it. Alright, so just we'll do the socials and then credits. So you probably know the score by now. Folks, the e-mail is hello at somewhere on earth.co on WhatsApp we are code 447486329484 and you can search for us on various bits of the social media via soap tech. Remember that's SOEP. 

00:26:29 Gareth Mitchell 

I don't know what you get if you get soap like as in detergent tech, but you can try it if you want and tell us what you found or just search for Somewhere on Earth, the Global tech podcast and that should get you there as well. Audio this week has been by Stevie Arnoldi and John Cronin here at Lansons Team Farner. 

00:26:50 Gareth Mitchell 

Production manager is Liz Tuohy the editor is Ania Lichtarowicz. And I'm Mr Mitchell. Thanks for listening. Bye. 

ENDS 

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