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Ukrainian Software Development Forum 2.0, 2014

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Aviram Eisenberg, founder and CEO of Ignite, presented his vision on the steps Ukraine should undertake to follow Israel’s example and success on Ukrainian Software Development Forum 2.0 on the 10th of September in Kyiv.
Ukraine has all the potential to become IT hub. In order to follow the example of Israel, Ukraine needs to overcome corruption, obtain support from the state and modernize education.

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Ukrainian Software Development Forum 2.0, 2014

  1. 1. Like Israel: from IT to High-Tech Aviram Eisenberg Ukrainian Software Development Forum 2.0, Kyiv 2014
  2. 2. The First Time I Came to Ukraine… 8 Years ago I came to Ukraine for the first time… I put on a nice suit (so I thought) and shopped for a good development partner Everybody was talking with me about the IT Industry (and I thought this “High-Tech” with Russian accent IT = Selling Development Services High-Tech = Selling Developed Products How do we turn the IT industry to High-Tech (and not just by changing the accent
  3. 3. About Me Father of 3 wonderful children High-Tech professional for the last 30 years Computer geek in my teenage days Platoon commander in the Army Intelligence (computer related) Computer Science Graduate from the Technion Chief Architect at Mind CTI Founder and CEO Of Ignite – a global IT company Chairman of the Israeli R&D Managers forum Lives in Kiev (Ukraine is my second home!)
  4. 4. 4 Country History 66 years 22,072 km2 23 years 603,628 km2 8,14 mln 44,29 mln now Age Territory Population Wars 10 wars (every 5-10 years) 1947-1949, 1956, 1967, 1967-1970, 1973, 1982-2000, 2008-2009, 2010, 2012, 2014
  5. 5. Israel - Silicon Valley in the East spend the highest percentage of GDP on scientific R&D: 4.4% compared to 2.7% for the United States R&D centers of Intel, Google, Microsoft, Facebook, IBM, etc. 19 companies listed on London Stock Exchange combined market capitalization on LSEG $6.9 billion 62 companies are traded on NASDAQ, totaling $ 36 billion
  6. 6. Israel is the Startup Nation Tel-Aviv comes is #2 in the top startup ecosystems in the world more than 5,000 active technology startups 450-500 startups are established every year each month 10 companies move to New York distributed and powerful angel investors network most venture capital per capita: 2.5 times more than the U.S. and 30 times more than Europe
  7. 7. How Did it Start? But, it was not always like that! 30 years ago Israel’s was very much like Ukraine – selling IT services to the USA The Israeli Army produced excellent developers International companies came to shop for good (and cheap) developers and established branches (Motorola, then Intel, them Microsoft…) With time, developers left the big companies and started small innovative product companies in the same vertical Investor-friendly government policy brought more big companies
  8. 8. How Did it Start? Few startups were sold to international companies Then came the VCs and the private investors And the rest is history…
  9. 9. 9 Investment adaptable microclimate Israel Ukraine Foreign investments in 2013 a record amount - $ 11.8 billion, which is 24% more than in 2012 "Protecting the rights of investors“ 2nd place 36 $ 2.86 billion 128 th place Corruption perception - global rank 144
  10. 10. 10 Government support Israel government programs established in early 1990-ies: - technological incubator programme, 1991; - 10 VC funds, with a budget of $100Min 1993 61% secured follow-on funding and 40% are active to this day $300Mbudget to subsidize up to 50% of R&D investments for new products, support for pre-seed projects $250Mbudget to help early stage BioPharma companies
  11. 11. 11 Government support Ukraine National project "Innovative Ukraine“ (pre-launch phase) Tried to build IT parks in Kiev and Kharkov Private real estate IT-park project “Bionic Hill” (terminated) Private VC investors initiative “Global Technology Foundation“ - Grant program since 2013 - $20K per project - 10-12 grants for startups every year
  12. 12. 12 Tax policy Israel Income tax policy of reducing tax rates (in 2004 - 36%, while in 2013 only 25%) Tax incentives for large investments - full exemption from income tax for 10 years - reducing of dividend tax to 15% Ukraine The total tax burden for IT-companies is more than 50% !
  13. 13. 13 IT Community & Education Israel more than 240,000 IT experts 2nd most educated country “Technion” took 7th place in the ranking of the best universities in the world Jewish Mom factor (you can do better, son!) Ukraine ~70,000 professionals in IT 16,000 IT graduates annually only 4-5K of new comers are employed in the specialty 4th of certified IT professionals in the global rank
  14. 14. 14 Areas of IT Expertise Israel Homeland Security - military software - airport and objects - personal surveillance control Cyber security Medical Devices industry Scientific researches Ukraine Programming instruments and platforms Computer games anything else you heard of?
  15. 15. 15 Challenges for Ukraine Corruption elimination Build new and well paid army forces, police, court judges, prosecutors Guaranteed equity rights Open registry lists and cadasters for all equity rights and assets (land, real estate, stocks, financial obligations, etc.) Education system reform Decentralized, more privately held kindergartens, schools, universities curriculums created by professional communities Transparent and automated bureaucracy E-government, easy doing business (go up in the rank)
  16. 16. 16 Ukraine’s Strengths High motivation for High Education Hunger to Succeed Individualistic and entrepreneurial spirit
  17. 17. 17 Conclusion IT Ukraine today and counting:  1500+ IT companies  250K+ dev community, ~ 70K are active  IT market increased by 20-25% in comparison with 2013  IT is $ 1,3 US billion industry  Doing Business Rank: in 2013 – 140, in 2014 – 112 (28↑) Ukraine is driving in the right direction, lets help her overcome the challenges!
  18. 18. 18 Thank you for attention! Questions? www.igniteso.com +38 0412 46-61-79 info@igniteso.com

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