1. Technology Investment Company
Kyiv, Ukraine
Cisco Entrepreneur Institute, Growth Up Conference
www.kmcore.com
May 2011

2. 2011 World Bank
Report Ukraine:
"Ease of Doing
Business" rank 145
(out of 183)

3. “I Fed My Dog Potential, But my Dog Died?”

4. Why Ukraine Needs
Entrepreneurs
Knowledge
Passion
Fire
Anatomy of an Entrepreneur

5. Agenda: Entrepreneurship & Innovation
 Potential: you have to do something with your potential
 The myth about “good ideas”
 Why US continues to lead the world in innovation?
 Other examples: Israel, India, Ireland…
 How Silicon Valley drives innovation
 Criteria for driving success?
 The “Developing” World
 Where is Ukraine today?
 KMCore

6. The Myth about Ideas?
 No shortage of ideas
 Ideas can come from anywhere
 Innovation is the “profitable implementation of ideas.
 Actual implementation of ideas that create social and
economic value
 Example: Google – 20% of engineers time allocated to work
on personal ideas
 #1 success factor: management team which can drive growth

8. The Case of Silicon Valley
 Long standing “Culture of Innovation” (does this exist in CIS?)
 Silicon Valley has 20% of the world’s software/hardware firms
 Ranked #1 for World Competitiveness
 800 US VC firms - 70% in Silicon Valley
 More than 30 Angel Investor Groups planting seeds
 Silicon Valley reinvents itself: clean-tech, green-tech, biotech….

9. Entrepreneurship in Silicon Valley
 The GDP in Silicon Valley more than 3X national average
 1% of US population generating 5% GDP
 Best conditions to commercialize ideas regardless of social
status or background
 2009 Global Insight study: VC backed companies created 12.1
million jobs - generated $2.9 trillion revenues
 Unique complex, innovative capability - financial, economic
and social ties

10. The Developing World
 Developing world approaching rich countries for innovation
 New business models, no legacy – new types of innovation
 22,000+ multinationals based in developing world
 Multinationals expect 70% growth in developing world
 40% growth from two countries: China and India
 100% of university graduates in India fluent in English
 Largest English speaking country in the world? CHINA
 More internet users in China than entire US and all of EU
 Wipro India reverse outsources to Egypt
 But ! Renault and Indian partner to build cheaper ($2199) car than Nano
Tata Nano $2500

11. Why Technology is Important – some Facts
 India – more than 10 million trained IT specialists
 Taiwan – technology makes up 50% of the economy
 Ireland – exports $1B of Software
 China – attracts more foreign direct investment than US
 Israel has more than 4000 tech companies and 100 VC’s
 Israel has 70 companies traded on NASDAQ
 US venture capitalists invested close to $18 billion in 2010
 Combined revenues of companies created by the VC industry
contributed 17.6% of US GDP in 2009

12. USA Still Attracting The Best Talent
 1/3 of silicon valley engineers skilled immigrants
 Many become future entrepreneurs
 Ecosystem of VC’s, investment banks, law firms, consultants
and accounting firms
 Complex relationships with global giants such as Google,
Intel, Cisco, Hewlett Packard
 People “incubated” in large companies, go and start new
companies – often competing or innovating (creating a cycle
of innovation)

13. Global US Companies Founded by Immigrants
 Intel Corp. - Andy Grove – Hungary
 Google - Sergey Brin – Russia
 Sun Microsystems - Andreas Bechtolsheim - Germany
 eBay - Pierre Omidyar - France
 Yahoo - Jerry Yang – Taiwan
 Paypal, Slide - Max Levchin - Ukraine

14. Ukraine Should Be Interested in
Entrepreneurship and Innovation!
 Promotes productivity and economic growth
 Addresses societal needs
 Supports national and global markets
 Creates new, high-value, knowledge based jobs
 Creates new wealth (regardless of social status)
 Advances competitive advantage
 Creates a higher standard of living

15. Government Policy Impact on Building an
“Innovation Society”
 Promoting competition, stimulating small business
 Creating conditions for attracting investment
 Encouraging internet deployment
 Improving Telecom/Internet infrastructure
 Education system producing specialists required by business
 Proactive: Ireland, Israel, India even Russia (Skolkovo?)
So, how much is the Ukrainian government doing?

16.  Innovation is a critical factor of competitiveness
and growth for Ukraine
 Conditions should be created for venture capital
and entrepreneurial activity to thrive
 Incubation and support of
small businesses will drive
innovation
 Ukraine has to compete
globally for financial and
intellectual resources
The Road Ahead…

17. Designed by Apple in California..
but… Assembled in China?

18. Will Ukraine in the
the next 25 years…
…Decide to compete
with China on an ‘Assembly Economy’?

19. …Or “compete”
with California on a ‘Design Economy’?

20. Or maybe the 3rd option??

21. Where are the Ukrainian Apples?

22. Where are Ukraine’s
Silicon Valley, Stanford, Google, Apple …?
Google Stanford
KMCore USA Oracle

23. Through Creation and Support of Small Business
and Entrepreneurship
We can and must foster an “Innovation Culture!”
‘assembly’culture ‘design’ culture

24. Here’s to the crazy ones, the misfits,
the rebels, the troublemakers, the
round pegs in a square hole, the
ones who see things differently.
They push the human race forward,
and while some may see them as
crazy ones, we see genius, because
the people who are crazy enough to
think they can change the world, are
the ones who will do it.
Apple Computer advertising, 9/27/97
(quoted from Guy Kawasaki’s book Rules for Revolutionaries)

25. KMCore
KM Core is a Technology Investment Company based in Kyiv, Ukraine which
capitalizes on the history of science and R&D in Ukraine, Russia and CIS.
We believe that innovation exists everywhere and strive to turn potential
into successful and growing businesses.
I invite you to visit our web-site to see our portfolio of investments
www.kmcore.com

26. Thank You
1-3, Pivnichno-Syretska St.
Kyiv, Ukraine, 04136
Bohdan.kupych@kmcore.com
www.kmcore.com