Venture Capital - Ukraine

Ukraine

Highlights

The total Capital Raised in the Venture Capital market market in Ukraine is projected to reach US$328.70m in 2024.
The Later Stage market dominates the market with a projected market volume of US$151.40m in 2024.
In global comparison, most Capital Raised will be generated the United States (US$136.6bn in 2024).
Ukraine's Venture Capital market is rapidly expanding, with a focus on tech startups and innovative solutions attracting increasing investor interest.

Key regions:

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Venture Capital market in Ukraine has been experiencing significant growth in recent years, driven by several factors.

Customer preferences: Investors in the Venture Capital market in Ukraine are increasingly seeking opportunities in the technology sector, particularly in areas such as software development, e-commerce, and fintech. This is due to the high growth potential and strong track record of success in these industries. Additionally, there is a growing interest in supporting startups that are focused on solving local problems and addressing the needs of the Ukrainian market.

Trends in the market: One of the key trends in the Venture Capital market in Ukraine is the increasing number of early-stage investments. This can be attributed to the growing number of startups in the country and the availability of funding from both local and international investors. As a result, there has been a rise in the number of incubators and accelerators that are supporting these early-stage ventures. Another trend in the market is the emergence of corporate venture capital (CVC) funds. Many large Ukrainian companies are now setting up their own venture capital arms to invest in startups that are relevant to their core business. This trend is driven by the desire to stay competitive and innovative in the rapidly changing business landscape.

Local special circumstances: Ukraine has a highly skilled and relatively low-cost labor force, which makes it an attractive destination for startups and investors. The country also has a strong engineering and technical talent pool, particularly in the IT sector. This has led to the growth of successful tech startups and has attracted the attention of venture capitalists looking for high-potential investment opportunities. Additionally, the Ukrainian government has been actively promoting the development of the startup ecosystem through various initiatives and reforms. This includes the introduction of tax incentives for investors, the establishment of innovation parks, and the simplification of regulations for startups. These efforts have created a favorable environment for venture capital investments in the country.

Underlying macroeconomic factors: The Venture Capital market in Ukraine is also influenced by macroeconomic factors. The country has experienced a period of political stability in recent years, which has increased investor confidence and attracted foreign capital. Additionally, Ukraine has a large domestic market with a population of over 40 million people, providing a significant customer base for startups. Furthermore, the country's strategic location between Europe and Asia makes it an attractive market for companies looking to expand into new regions. This has led to an increase in cross-border investments and partnerships, further fueling the growth of the Venture Capital market in Ukraine. In conclusion, the Venture Capital market in Ukraine is experiencing significant growth due to customer preferences for technology startups, the emergence of early-stage investments and corporate venture capital funds, local special circumstances such as a skilled labor force and government support, and underlying macroeconomic factors such as political stability and a large domestic market. These factors are driving the development of a vibrant startup ecosystem and attracting both local and international investors to the Ukrainian market.

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.