Outsourcing in Ukraine in 2024: Analyzing Risks and Benefits

Have you ever wondered how a country’s IT sector could thrive during wartime? In the case of Ukraine, the answer is truly remarkable. Despite the big challenges of the ongoing conflict, the country’s tech industry has adapted and innovated impressively: up to 90% of developers have adjusted and continue to work full-time. Instead of being hurt by the war, Ukraine’s IT market has become a symbol of resilience and creativity, still providing top-notch services to clients all over the world. 

What’s more, in 2024, Ukraine remains a top choice for outsourcing. With a strong IT sector, many skilled professionals, and affordable costs, Ukraine is a great option for businesses everywhere. But how do they continue to deliver high-quality services to clients worldwide? Let’s explore these questions and uncover the incredible resilience of Ukraine’s IT sector.

IT Outsourcing in Ukraine – Fast Facts & Advantages

Ukrainian IT companies have swiftly adapted to wartime conditions. According to the IT Ukraine Association, 85% of IT companies have successfully implemented business continuity plans, ensuring uninterrupted service delivery. Many companies have relocated their operations to safer regions within the country or established remote working protocols, allowing developers to continue working full-time.

Ever wondered how Ukraine ensures the safety of its IT industry? The Ukrainian government, alongside industry leaders, has prioritized the safety of IT infrastructure and professionals. In particular, cybersecurity measures have been enhanced, and critical data centers have been fortified. Many companies relocated their employees to western and central parts of Ukraine or abroad. What’s more, employees working in the IT sector have been reserved from joining the military to ensure smooth and stable work processes. As a result, there has been minimal disruption to IT services, with over 90% of IT companies reporting stable operational status.

Considering this approach, the demand for Ukrainian IT services remains robust. In 2023, the IT sector generated almost $7 billion in export revenue, a 5% increase from the previous year, indicating sustained global trust in Ukrainian expertise. It’s evident that international clients continue to seek out Ukrainian developers for their high-quality work, cost-effectiveness, and innovative solutions. 

In terms of the average hourly rate for a developer from Ukraine, it’s generally not high. On average, developers in Ukraine typically charge between $25 to $80 per hour for their services. However, it’s important to note that these rates can vary based on project complexity and the specific expertise required.

Despite tough times, Ukraine’s IT companies are doing more than just surviving—they’re thriving! They’re using new ideas and their ability to bounce back from tough situations to turn problems into chances to grow. Instead of sticking to what they know, IT companies in Ukraine are exploring new areas, opening new offices in or outside Ukraine, and offering fresh services and products. It’s a sign that even when things get tough, Ukraine’s IT industry keeps moving forward, ready to take on whatever comes its way.

Ukraine’s Global Tech Expertise Acknowledgment

Ever wonder why Ukraine’s tech expertise is gaining global recognition? In the last few years, Ukraine has become known for its great ideas and top-notch work in the tech world. The country has lots of talented people working in IT, and there are many new tech companies starting up. Because of this, Ukraine’s tech skills are getting noticed all around the world. Let’s take a closer look at the country’s position in the global IT field.

Outsourcing Journal ranks Ukraine as the 1st largest outsourcer in Eastern Europe. The country has a fairly competitive market and has already made itself known worldwide. In 2022, one in five Fortune 500 companies relied on Ukraine for software development. According to Schneider Group, an international advisory company, the country became the 1st IT outsourcing and software development center in the CES region. Simple tax regulations, strong technical background, and a high number of developers are the factors that explain why Ukraine is popular among foreign companies for office relocation and outsourcing. 

Robust and Vibrant IT Community

Currently, Ukraine is the no. 4 country with the world’s best developers. The reason is clear: the Ukrainian IT community lists thousands of experts who create top-quality digital solutions at an affordable price.  

According to the Ukrainian IT Report, Ukraine’s IT industry grew by 36% in 2021, from $5 billion to $6.8 billion in exports. AmCham says 96% of companies decided to continue operating in Ukraine in 2023. Compared to 2021, the volume of software services in Ukraine for the nine months of 2022 increased by 13% and exports by 23%, the Ministry of Economy reported.

Top-tier Education and Proficiency in English

If you wonder why Ukrainian developers are so popular, here’s the answer — Ukraine has a well-established education system with a focus on science and technology. Universities In Ukraine produce a huge number of skilled IT professionals annually.

Also, it’s worth mentioning that Ukrainian developers often have strong English language skills, which is crucial for communication in the global tech industry. 

Abundant IT Workforce 

In 2023, the number of IT experts in Ukraine increased by about 2.7% to 346.2 thousand people. That’s a significant rise, taking into account the war in Ukraine. 

Software developers in Ukraine are highly experienced in popular and less-known programming languages, including JavaScript, Node.js, PHP, Python, Java, and C++. They provide services such as software/web/mobile app development, dedicated teams, tech consulting, testing & QA, DevOps, Cloud Services, UX/UI, and more.

The large talent pool in Ukraine has been showing impressive growth over the years due to many factors. A well-established education system, strong English language skills, support of the IT industry by the Ukrainian government, and remote work culture are just a few reasons why Ukrainian software developers remain one of the leaders in the global IT market. 

Focus on Data Protection and Information Security

Outsourcing software companies in Ukraine​​ deal with compliances such as HIPAA, PCI, and ISO certifications to adhere to global standards for information security management. What’s more, if you strike a deal with a Ukrainian tech company, a vendor signs a non-disclosure agreement that protects your business ideas.

So, you can rest assured that all your information assets and the users’ confidential data will be protected when outsourcing to Ukraine. 

Top Ukrainian IT Companies: Full Reviews

There are more than 5,000 outsource software development companies in Ukraine. Thus, it can be quite difficult to immediately make a good choice from a list. In this part, we will help you find out which Ukraine IT outsourcing companies are the best and why you should rely on each individual option.

As a basis for our list, we took such criteria as:

• Years in business,
• Team size,
• Market position,
• Tech expertise, 
• Industry specialization, 
• Qualification levels of developers,
• Portfolio with case studies, 
• Reviews at Clutch.co, GoodFirms, etc.

In addition, we started the list of Ukrainian software companies in ascending order; that is, small and medium companies go first, followed by large companies with more than 1,000 specialists on board. Some prefer working with large outsourcing companies in Ukraine, and some intend to find a reliable service provider with a small, flexible team. 

Well, let’s begin our journey through the leading Ukrainian IT companies with a detailed overview of each of them.

Mangosoft

Mangosoft has been providing software product development services for over 12 years. Having 350+ experts on board, 70% of the staff are Middle and Senior specialists. The technological expertise is focused on Big Data, AI & ML, VR & AR, blockchain, and DevOps engineering. With a wide tech stack in .Net, Node.js, Java, PHP, Python, and the best industry practices, the team managed to build a good reputation on the market. Specializing in e-commerce, fintech, gaming, healthcare development, and other areas, it has delivered 250+ projects in 30+ countries – the USA, UK, Canada, etc. Mainly, these projects are aimed at digital transformation to provide increased efficiency, lower operating costs, and fast revenue growth. The support team of business analysts, managers, and designers contributes to project outputs.

Among clients, there are market leaders, including EBRD, Electronic Arts, and TouchPress, as well as middle-sized businesses and startups. 90% of clients are ready to recommend the company as a strategic technology partner. Therefore, Mangosoft deserves to be on this list as the top outsourcing company in Ukraine.

Program-Ace

In 1992, headquarters were established in Kharkiv, Ukraine, to deliver smart solutions around the world. The company has more than 28 years of experience in developing full-cycle software. The team of 120+ specialists doesn’t stop showing growth in the IT sector using the latest technological innovations (VR, AR, IoT, blockchain, AI, etc.) The main service line is, after all, based on AR / VR development as a way of gamification in business or education applications. One of the recent projects at Program-Ace confirms their core expertise – a fully gamified farm management system for the active involvement of employees. These Unity-certified developers can provide customers with powerful and interactive solutions that quickly adapt to the needs of the industry in which they work – be it marketing or manufacturing. Thanks to its proven track record, this team boasts 800+ projects in various fields and awards like TOP 3 VR & AR developers 2019 (by Clutch), The Global Outsourcing 100 companies (by IAOP), etc.

Light IT 

Looking for Data Science solutions for your project? Welcome to this software development company that has been offering various BI and Big Data solutions since 2006. The team of 150+ professionals focuses on the client’s needs and requirements to help them achieve their business goals and turn ideas into profitable products. Deep expertise in Data Science allows this company to earn millions of dollars for its clients in the era of big data. For example, they recently created MemeMachine, a unique analytic system with a huge database that allows business decisions to be made in seconds. They use innovative data mining and processing technologies to transform piles of data into useful knowledge. It is especially effective in fintech, e-commerce, advertising, and other areas where it’s extremely important to make informed choices and take reasonable measures for different benefits.

QArea 

Since 2001, QArea has helped medium-sized enterprises scale their software solutions and expand their development teams with true experts. As of today, the company has managed to hire over 250 specialists – software engineers, testers, business analysts, and DevOps specialists – to meet the most stringent business requirements. In their rich portfolio, you will find evidence of extensive experience working with the most popular technologies (blockchain, big data, cloud), programming languages (Golang, Java, PHP), and frameworks (Drupal, Angular). They serve many industries – arts, entertainment & music, e-commerce and retail, healthcare, real estate, and many others. A recent project was dedicated to a cryptocurrency-based social commerce platform for the Internet and mobile devices. At QArea, you can pick the most suitable cooperation model for your own project – dedicated team, staff augmentation, or project outsourcing. By offering IT staff augmentation, they help customers get started quickly on development projects and eliminate recruiting overheads.

Reenbit

Reenbit, a dynamic IT firm based in Lviv, Ukraine, excels in custom software development, cloud solutions, and IT consulting services. Since its establishment in 2018, Reenbit has rapidly built a strong reputation for delivering high-quality solutions to a diverse range of clients, from startups to established enterprises. The company employs a talented team of over 100 professionals who are experts in advanced technologies such as .NET, Azure, React, Angular, and more. Reenbit has already completed over 50 projects in various sectors, including finance, healthcare, e-commerce, and logistics. On the official website, the company claims that 60% of its staff consists of senior-level employees. 

Binariks

Binariks, based in Lviv, Ukraine, is known for its great ideas and top-quality work in the field of IT. Binariks has a team of 180+ professionals who work to create the best solutions for different kinds of businesses. Their expertise includes custom software development, mobile and web application development, cloud computing, and DevOps services. ​​Some notable projects by Binariks include developing sophisticated healthcare platforms that improve patient care, creating scalable e-commerce solutions that enhance customer experience, and implementing robust financial systems that streamline operations for businesses. With a proven track record of delivering impactful projects and a commitment to excellence, Binariks continues to be a vital force in the IT world.

Edvantis

This award-winning Ukraine IT outsourcing company has more than 400+ skilled experts proficient in software engineering, Data Science and BI, AI, and Cloud. Edvantis provides services mainly in healthcare, real estate, transportation and logistics, and e-commerce. Having been on the market for more than 18 years, the vendor has completed around 400 projects for companies of all sizes. Its perseverance to take businesses to the next level results in a 98% client satisfaction rate. The vendor’s key clients include Oasis, SAP, COLLENDA, and others. Plus, the company has 40+ active clients. 

Core values of Edvantis:

• Customer focus
• Professionalism
• Teamwork 
• Accountability
• Innovations 

ATEAM SOFT SOLUTIONS

Founded in 2010, ATEAM SOFT SOLUTIONS is a dynamic IT company from Ukraine that provides cutting-edge software development services. With a dedicated team of over 150 skilled professionals, they offer a wide range of services, including web and mobile app development, custom software solutions, and IT consulting. The company’s mission is to deliver innovative and reliable solutions that drive business success for its clients across various industries. With over a decade of experience, ATEAM SOFT SOLUTIONS has established itself as a trusted partner in the tech industry, committed to excellence and customer satisfaction.

Winged IT

Winged IT is a Ukrainian IT company known for its exceptional software development and IT consulting services. Established in 2015, Winged IT has rapidly grown to become a trusted partner for businesses worldwide, providing innovative solutions tailored to meet the unique needs of each client. Headquartered in Kyiv, Ukraine, the company has additional offices in key tech hubs across the country. The team comprises 200+ highly skilled professionals, including software developers, designers, project managers, and IT consultants. Winged IT takes pride in its high client retention rate, reputation for reliability, efficiency, and top-notch customer service.

Services of the company include: 

• Software Development
• IT Consulting
• Outsourcing
• Quality Assurance

Accedia

Accedia is a premier IT solutions provider dedicated to driving innovation and excellence. Having over 300 professionals, the company specializes in software development (Application Development, AI Development, Data Analytics, Cloud Engineering, DevOps, and Automation Software Testing) and technology consulting (Business Analysis, UI/UX Design, Solution Architecture, Technology Advisory, and Cyber Security). The expertise spans across industries, delivering tailor-made solutions that empower businesses to achieve their goals. At Accedia, they blend cutting-edge technology with deep industry knowledge to provide exceptional value to clients. 

CGS-team

CGS-team was established in 2008 and is headquartered in Lviv, with additional offices across the country. Currently, the company has over 250 skilled professionals who are engaged in custom software development, web and mobile applications, enterprise solutions, IT consulting, digital transformation, and comprehensive managed IT services. With a strong focus on quality assurance, they have successfully completed over 500 projects for more than 200 clients worldwide, including Fortune 500 companies and innovative startups. Besides, CGS-team has received multiple industry awards for their commitment to innovation and excellence. The company states that its mission is to empower businesses with reliable IT solutions, fostering efficiency and growth, while its vision is to be a global leader in IT services. 

3 Key Outsourcing Models Used by Ukrainian Software Companies

Outsourcing involves several engagement models – dedicated team (IT staff augmentation), time and material (T&M), and fixed price. Therefore, when you choose the best software development outsourcing company in Ukraine or any other country, you should have a full understanding of what the engagement model is, the key types and differences between them, and which one will be effective for your own project. Let’s dive into each question!

• What is an engagement model in outsourcing? This is a set of agreements declared between a client and a vendor. Outsourcing is supposed to be a strategic partnership, not a simple transfer of responsibilities to a third party. For this reason, there are special aspects and procedures for regulating relations between partners. They determine all the necessary conditions and serve as a solid basis for cooperation. The key focus of any engagement model is on the client’s needs and the company’s capabilities.
• What are the types of outsourcing models? You can choose between several types of collaboration in the IT outsourcing market – dedicated team, time & material, and fixed price. Selecting the right engagement model is a very important decision for the entire development process. How you intend to collaborate directly affects the completion of the project and other outputs. Build a solid foundation for your project right now by choosing the best service provider and working within an effective business model.

• Dedicated Team (often called Staff Augmentation / Outstaffing)

This is the easiest way to expand the IT staff with third-party specialists outsourced from any part of the world. It’s possible to hire nearshore or offshore developers as additional resources to complement the project with new skill sets. This way, the team becomes 100% flexible and scalable according to specific needs. The key factors in choosing this model are a globally accessible talent pool and cost reduction (especially if you outsource to developing countries like Ukraine or Belarus, where an hourly rate of developers starts at $30). 

• Time and Material (T&M) – Pay-as-You-Go

This is one more effective way to develop a product with unclear or ever-changing requirements. This usually happens at the beginning when the business needs are not clearly defined or in the middle when they may change. In this case, the entire development process is flexible, as are team participation and distribution time. The final cost is based on the actual time spent on the project and the hourly rate of the involved specialists. Who can benefit from this model? Enterprises with long-term projects must adapt to new requirements and market needs at an early stage. However, it is imperative to set the right time and team management so as not to lose control of the project.

• Fixed Price

There is another working model according to which a certain amount of money is clearly determined and paid after completing all the necessary tasks. When is it worth applying to the given type of engagement? Firstly, as a customer, you must have the overall vision of the product with well-specified requirements for the team. Secondly, the team must understand the final product and its results. In a reverse situation, both of you should conduct a business analysis and come to a clear understanding of what to do, how, and in what timelines. As a result, a fixed amount of work leads to fixed prices and terms. There are no hidden costs, but at the same time, there is no way to deviate from the planned path (only if you cancel the contract).

Top 5 IT Hubs with Most Ukrainian IT Companies

UNITCity, an innovative Ukrainian center, published a report about the IT ecosystem in Ukraine. It states that more than 20 cities have their IT communities. Kyiv, Dnipro, Odesa, Lviv, and Kharkiv are mentioned in UNITCity’s report. So, let’s examine them in-depth taking as criteria for evaluating the number of top IT outsourcing companies in Ukraine, IT coworking spaces, and average developer’s salaries: 

1. Kyiv. This is a central IT cluster in the country: about 51,7% of tech companies were registered in 2018. Here, you’ll find specialists with any qualifications. As for the average salary of developers in Kyiv, it may start at $1,500 per month. Additionally, Kyiv has a rich IT development community that includes 10 main IT hubs like 1991 Civic Tech Center, Blockchain Hub Kyiv, Data Hub, Kyiv Smart City, iHub, and others. 
2. Lviv. Located in the Western part of Ukraine, this city has 15% of all Ukraine IT outsourcing companies. In Lviv, CoMmuna, ITEA hub, Startup Depot, and Lviv IT Cluster are the key tech centers. Lviv IT Cluster predicts a 25% annual growth in the IT industry. Besides, Lviv is ranked as a top 3 tech development center along with Kyiv and Kharkiv, proving the strong potential of the city.
3. Kharkiv. This is the third IT hub, with 12% of Ukraine software outsourcing vendors. Kharkiv IT Cluster is a technology hub that includes 73 top IT outsourcing companies specializing in app development, software engineering, and other areas. On average, a software developer can earn up to $2,000 per month. Kharkiv has a well-developed IT network that encompasses more than 60+ software companies. 
4. Dnipro. Nearly 8% of all Ukrainian IT companies are located in this city. The average salary rate for a developer starts at $1,000. In Dnipro, there are several innovative development centers like Coworking 365, Fabrika.space, etc. where tech professionals discuss and share their ideas about development solutions. Most of the IT outsourcing companies situated in this city have experience in automotive, retail, healthcare, e-commerce, and other industries.
5. Odesa. This city has 5% of the top IT outsourcing companies in Ukraine. Software programmers get from $1,350 per month. In Odessa, there are several tech hubs like Impact Hub Odessa and Terminal 42. Technology companies from this city solve issues in the following industries: logistics, cybersecurity, telecommunications, finances, and transport. 

How to Mitigate Risks When Outsourcing to Ukraine

Outsourcing has become an integral part of many businesses’ strategies for growth and efficiency, with Ukraine emerging as a popular destination for outsourcing IT and other services. As it was mentioned before, choosing Ukraine for software development, is safe since companies have adapted to the crisis and implemented numerous safety measures. Yet, you can mitigate the risks and ensure successful outsourcing partnerships from  your side also. Let’s look at what you can do to mitigate risks when outsourcing to Ukraine. 

1. Choose eastern and central regions: Prioritize locations in the western and central regions of the country. Cities like Kyiv, Lviv, Uzhgorod, Chernivtsi, Ternopil, or Vinnytsia are stable and less affected by conflicts compared to eastern areas. By choosing partners in these regions, you can reduce the likelihood of disruptions to their operations and minimize risks associated with political instability.
2. Discuss safety measures in advance: Address concerns about physical security, cybersecurity, and emergency protocols. By having open and transparent conversations about safety measures in advance, you can make sure that both parties are aligned in their approach to risk management and preparedness. In Ukraine, IT companies have adjusted to risks and so ensured/provided all of their employees with a stable Internet connection, generators, power banks, portable gas stoves, etc. Rest assured that Ukrainian IT companies are well-prepared to handle various risks in the country, including power outrages.
3. Consider Ukrainian companies with extra offices outside the country: Partner with companies having additional offices or operations outside the country. Almost all companies in Ukraine have opened extra offices outside the country to maintain operations and effectively support their clients. Besides, at Mangosoft, we opened extra offices outside Ukraine, including Poland, and relocated most of our employees abroad. This helped us to provide businesses with an extra layer of assurance and minimize the impact of localized issues on their outsourcing arrangements. 

What sets Mangosoft apart from other prominent IT outsourcing companies in Ukraine?

Mangosoft is an outsourcing company with a focus primarily on functionality, innovativeness, and best industry practices. The company builds world-class software receiving numerous positive reviews from clients.

Conclusion – So, What Company to Choose and How?

Outsourcing development companies are booming in Ukraine – from small to large teams. Their solutions are as diverse as their number. In this article, the top IT outsourcing companies in Ukraine are described in detail. Without any doubt, you aren’t limited to this list of Ukrainian software companies. Many other companies are left for your consideration.

• Where will you find top Ukrainian IT companies? Open Clutch or GoodFirms, and set your own filters – average hourly rates, team size, client/industry focus, and location. You can sort options by review rating or other ranks. Do not neglect reading reviews on these platforms. As a rule, they are carefully verified for potential customers.
• How do you choose the right outsourcing partner? After you select from three to five suppliers, you need to evaluate them based on the following criteria: competence confirmed by completed projects, market reputation identified in previous customer reviews, team skill sets needed for successful project execution, and communication and management methods. It’s highly recommended that you focus on expertise as an important criterion in the hiring process. Double-check whether the company is suitable for you during close communication with team members.

Nowadays, various development services are offered, and most of them are based on outsourcing models – dedicated development team, time and material, and fixed price. So, if you decide to outsource your project to Ukrainian developers, you’re in the right direction. As a result, you’ll get many benefits, including high-quality services, multiple areas of special expertise, and cost savings.

If you have any questions about our IT outsourcing services, don’t hesitate to contact us, and our experts will help you find the solution for your business as soon as possible.