Top IT outsourcing companies in Ukraine – Detailed overview
Top IT Outsourcing Companies in Ukraine – Detailed Overview
The Ukrainian IT industry is increasing. In 2018 alone, there were 4,000 tech companies with 184,700 programmers on board. Besides, Ukraine was ranked at 18th place in the Global Outsourcing-100 list in the same year. The reasonable hourly rates, a convenient geographical position, and favorable tax conditions for IT services are the key factors that make this country an attractive location for foreign investments.
Why is Ukraine a good spot for IT outsourcing? What are the most successful software and product companies in this country?
In our material, you’ll find out information about the best software companies in Ukraine. So, let’s explore them in detail!
Ukraine’s Place in the IT industry
The country has quite a competitive market in Eastern Europe. Nearly 100+ software companies in Ukraine are listed in Fortune 500 rating. 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.
The Ukrainian software companies earned $4,5 billion in 2018, which was 40 times more than in 2003 accounting for $110 million. The other benefit of working with developers from Ukraine is that their quality of work is placed on 11th rating among the other 50 world countries. The statistics of the IT area indicates that the country has a prosperous tech market, and the following numbers prove this fact:
- The IT industry accounts for 3% of Ukrainian GDP growth each year
- The annual growth of IT outsourcing is 25% in Ukraine
- The hourly rates of programmers range from $25 to $35
- Outsourcing is estimated at about $2,5 billion in Ukraine
- More than 2,000 start-ups
- 20% of foreign world companies relocated their offices to Ukraine
- 2% of young people are employed in the IT industry
- Ukraine has 4,000+ of software companies in 2018
- 75% of coders have a university degree, and 6% of them finished Master and Ph.D. programs
- 60% of engineers work in IT outsourcing companies
- There are over 100 R&D centers representing e-commerce, gaming, telecommunication, and many others
- Ukraine has more than $290 million of startup investments
- There are 1000+ technology events each year
- More than 50 coworking spaces
- The growing module of IT outsourcing services went up to 180% in 2017
- Accelerance, a software development company, evaluates Ukrainian technical readiness for outsourcing as high
- In 2017, there were 19 successful ICOs (Initial Coin Offerings)
- 150+ of universities teach future IT specialists
- Ukraine has 7th place in the quality of freelance work
- IT sector has more than $4 billion of investments for startups
- 16 tech outsourcing providers are included in the 2019 Global Outsourcing-100 list
- Fortune 500 companies selected Ukrainian companies in the top 100 rating
- A flight from New York to Kyiv takes up to 15 hours
Top Ukrainian IT Companies
In this section, you’ll discover what IT outsourcing companies are the best in Ukraine in terms of work cooperation and service quality for foreign clients. As a basis for our list, we took such criteria as tech expertise, hourly rates, industry specialization, and professional level of developers.
This company has 7+ years of IT outsourcing experience with a technology specialization in Big Data, AI & ML, Data Science, Enterprise Resource Planning (ERP), Internet of Things (IoT), blockchain, and DevOps. Mangosoft has middle and senior developers on board with experience in software integration, custom enterprise software development, migration, QA testing, reengineering, and many others. The company has projects in e-commerce, healthcare, FinTech, logistics, media, travel, and real estate.
The company has over 15 years of experience in providing IT outsourcing software solutions to clients in the world. IT Svit offers consulting services to start-ups, SMBs (small and medium-sized businesses), and large enterprises. Its tech specialization includes data migration, Big Data, DevOps, cloud computing, blockchain, software development, etc. IT Svit has 50 professionals who helped clients from North America, South America, Europe, Australia, Asia find solutions for their business.
With over 20 years of experience, DataArt has projects in healthcare, media, financing, travel, logistics, and retail industries. The company specializes in cloud computing, blockchain, AI & ML, DevOps, Internet of Things (IoT), Data Science, software engineering, app development, etc. DataArt has about 2,600 employees and more than 200 offices situated in the USA, European and Southern American regions. This outsourcing software company has a high reputation among clients in the world.
It was found in 1993 by two students from Lviv Polytechnic University. The tech focus of SoftServe includes cloud computing, big data, internet of things (IoT), cybersecurity, extended reality (XR), AI & ML, experience platform and design. This outsourcing software company solves business problems in healthcare, public governance, telecommunication, and many other fields. Also, SoftServe has an IT academy that prepares its students for a tech career in software engineering, app development, etc.
It has 28+ years of software development experience having more than 1,400 professionals. Its tech expertise includes the Internet of Things (IoT), virtual reality, blockchain, Data Science, digital enterprise, and mobility. ELEKS has track of successful projects in retail, media, real estate, agriculture, and state sectors offering solutions to clients as software testing, its diagnostics, and app reengineering. Other than that, a company has offices in 4 Ukrainian cities like Kyiv, Lviv, Ivano Frankivsk, and Ternopil.
Since 2002, this IT software company provides outsourcing services in robotics, cybersecurity, app development, and digital commerce. Ciklum has a technology specialization in Data Science, software engineering, migration, tech integration, DevOps, QA testing, and others. Furthermore, a company opened development offices in Poland, Belarus, Pakistan, and Spain. Ciklum opened its offices in such Ukrainian cities as Kyiv, Dnipro, Kharkiv, Odesa, Lviv, and Vinnytsia.
This outsourcing software company was founded in 2002. Intellias specializes in product development, software engineering, DevOps, cloud migration, data analytics, AI (Artificial Intelligence), and QA testing. Development in automotive, real estate, FinTech, logistics, retail, agriculture, and energy are the main sectors where the company offers solutions to clients. Intellias has four offices in such Ukrainian cities as Kyiv, Kharkiv, Ivano-Frankivsk, Lviv, and Odesa.
Its key tech expertise encompasses software engineering, digital security, SAP consulting, cloud migration, Big Data, Internet of Things (IoT), AI (Artificial Intelligence), Data Science, and blockchain. Infopulse has successful projects in banking, finances, automotive, telecommunication, healthcare, manufacturing, retail, energy, and other industries. The company has more than 29 years of experience in IT outsourcing services solving tech problems in more than 30 countries.
From 1989, this company solves business tech issues in the world. Miratech has experience in industries like healthcare, banking, insurance, telecommunication, and investing. Cybersecurity, AI & ML, software engineering, Big Data, app development, etc. belong to technology expertise. This software development company has offices not only in Ukraine, but in some American, European, and Asian countries. Miratech has more than 700 employees who strive to develop product solutions to clients worldwide.
It’s a Ukrainian outsourcing company with over 17 years of experience in the IT market. The technological specialization of Sigma Software contains cross-platform app development, software maintenance, QA testing, DevOps, VR (Virtual Reality) & AR (Augmented Reality), Internet of Things (IoT), Big Data, etc. The company solved the issues in such industries as automotive, advertising, healthcare, financing, banking, telecommunications, energy, and others.
This software outsourcing company has more than 28 years of experience. The main office of Program-Ace is in Kharkiv. Having 120+ employees on board, the company specializes in app development, Virtual Reality (VR), software engineering, Augmented Reality (AR), etc. Program-Ace has projects in agriculture, manufacturing, retail, FinTech, healthcare, media, marketing, energy, and other industries. React Native, Unity, Angular, Unreal Engine, blockchain, ASP.NET, Node.js, etc.
This Kyiv-based company provides IT services since 1995. Softengi has technical expertise in developing chatbots, software testing, cloud migration, SAP integration, etc. Blockchain, the Internet of Things (IoT), gamification, 3D modeling, and others are the essential services that a company offers to clients. Softengi solves business issues for start-ups, SMEs (small and medium-sized enterprises), large enterprises, and government organizations. This software outsourcing provider has ISO/IEC 27001:2013 certificate that proves its high-quality service.
The company has over 15+ years of experience in the IT industry. AMC Bridge provides services in QA testing, software app development, BIM (Building Information Modeling) and PLM (Product Lifecycle Management). The essential industries where a company has projects are manufacturing and AMC (Building, Civil, Plant). Siemens, SAP, AUTODESK, ModuleWorks, intrinSIM, and others are the tech organizations with which AMC Bridge has partnership agreements.
3 Engagement Models
The engagement model is a set of rules that aim to coordinate relations between a software company and an ordering customer. In general, there are three of this agreement that Ukrainian IT outsourcing companies implement in their work processes. Below, we’ll describe each of them one by one:
It’s a business method when one company offers software services to businesses. Outsourcing can be nearshoring, offshoring, onshoring, and multisourcing. Let’s uncover what they mean exactly these models mean. Nearshoring is used when management executives establish an agreement with the outsourcing company situated not far away from their country. Onshoring refers to a local business: when one organization outsources services to another inside the same state. In contrast, offshoring relates to cooperation with a distant country. Multisourcing aims to deliver services to several IT vendors.
This model intends to hire an external contractor or a company that can find developers for a project. The benefits of outstaffing are reasonable prices and high quality of IT services. This method is suitable for companies when they can’t afford a team of programmers and want to save money. There are two types of outstaffing – leaning and temporary. The leaning approach determines business relations between contracting and client companies. Moreover, a temporary outstaffing has a specific period of cooperation – be it one week or a year. This way, such an outstaffing model helps businesses find skilled developers who can solve their problems.
3. Dedicated Team
It’s the way of hiring a remote development team for an IT project. The dedicated team model allows business owners to choose programmers in accordance with their criteria like professional qualification, coding knowledge, tech expertise, etc. The key goal of it is to hire IT specialists that might help complete a project. The dedicated team model has a transparent process of setting prices and tracking project results. All these methods are helpful for clients because their scope, deadline, and budget are defined precisely. Thus, a dedicated team is a good alternative for companies that look for a concrete number of developers for a project.
Mangosoft offers outsourcing software development services to clients. Also, our company can help you find highly experienced programmers using a dedicated team model. If you struggle to solve tech problems, our professionals will assist you in any queries. So, don’t hesitate to contact us!
Top 5 IT Hubs in Ukraine
UNITCity, an innovative Ukrainian center, published a report about the IT ecosystem in Ukraine. It is stated 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 software companies, IT coworking spaces, and average developer’s salaries:
It’s an important IT cluster in the country: about 51,7% of tech companies were registered in 2018. Depending on professional experience and technology expertise, software developers can earn up to $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.
Nearly 6% of all Ukrainian IT companies are located in this city. The average salary rate for a developer starts from $1,400. In Dnipro, there are several IT innovative 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.
Located in the Western part of Ukraine, this city has 5% of all IT companies. In Lviv, CoMmuna, ITEA hub, Startup Depot, and Lviv IT Cluster are the key tech centers. Software developers get from $1,400 per month. Lviv IT Cluster predicts a 25% annual growth of the IT industry. Besides, Lviv is ranked as a top 3 tech development center along with Kyiv and Kharkiv that proves a strong potential of the city.
It has 4,5% of registered IT 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 like logistics, cybersecurity, telecommunications, finances, and transport. Odesa is the fifth-largest IT center after Kyiv, Kharkiv, Lviv, and Dnipro.
It’s the second IT hub after Kyiv. Kharkiv has 7,5% of software companies in Ukraine. Kharkiv IT Cluster is a technology hub that includes 73 top companies specializing in app development, software engineering, and other areas. On average, a software developer earns up to $1,500 per month. Kharkiv has a well-developed IT network that encompasses more than 66 software companies.
5 Advantages for US Companies to Invest in Ukraine
More than 50% of US companies invest in the Ukrainian IT sector. Microsoft, IBM, Google, and other tech giants opened their offices in Ukraine. What are the main reasons for choosing Ukraine? Simple taxation, professional tech expertise, fast-growing IT market, and high English level are the main factors that influence investment decisions. So, let’s unravel them one by one.
Benefit 1: Favorable Tax Conditions
Foreign companies don’t pay Ukrainian VAT (value-added tax) when they order software services in Ukraine. Such a rule applies to software development, R&D centers, consulting, data processing, and others. IT services bought from independent contractors or freelancers don’t pay Ukrainian VAT as well. All tech companies won’t pay this type of tax until 2023. Altogether, these factors determine a choice of US companies to start outsourcing to Ukraine.
Benefit 2: Highly Professional Developers
Ukraine has a large pool of programmers who know how to develop software products from scratch. More than 90,000 developers specialize in QA testing, software engineering, app development, etc. Their primary technology focus includes Python, Java, PHP, and .NET. The average hourly rate of software developers starts from $25. The additional advantage of hiring a coder from Ukraine is a convenient time zone, which is 7+ hours for the USA.
Benefit 3: Well-Developed IT Market
The tech sector generates up to 7% of annual GDP growth. This number will continue to increase by 15% in 2020. Moreover, the global competitiveness score is 4,1 that defines a Ukrainian economic development at the world level. The revenue growth of the IT sector is up to $3 billion per year. The geographical location, low taxes, and high technical expertise of software developers are the key factors that determine why the tech sector grows in Ukraine.
Benefit 4: Excellent English Proficiency
The English level of Ukrainian developers ranges from Upper-Intermediate to Advanced. The English proficiency score is 33 as Accelarence mentions in its report. Most technology universities like NU “Kyiv Polytechnic Institute” and Lviv Polytechnic University teach English to their students. Some specialized courses can be held in the English language. Nearly 16,000 graduates are from technical universities as Forbes states.
Benefit 5: Strong Technical Background
Outsourcing development services are striving in Ukraine. From software development to finding solutions for infrastructure architecture, Ukrainian developers can provide highly professional expertise.
Now you know the key facts about the Ukrainian tech market and why it’s an attractive spot for foreign investors. In our article, we mentioned top IT outsourcing companies, three engagement models, and five main reasons why US companies should invest in Ukraine.
Mangosoft also cooperates with US business and provides outsourcing services like app development, QA testing, migration, software integration, and others.
If you have any questions about our IT services, don’t hesitate to drop us a line, and our experts will help you find a solution to your business problem.