Driver of Innovation: How the Ukrainian Startup Fund is building an innovative Ukraine

The establishment of the Ukrainian Startup Fund (Innovation Development Fund) in 2018 at the initiative of the Prime Minister of Ukraine was a landmark event for the Ukrainian innovation sector. For Ukraine, the creation of such a Fund was an important stage in the development of the ecosystem.

Its mission is to promote the creation and development of technology startups at the early stages (pre-seed and seed), to increase their global competitiveness, to help businesses get on their feet and to give impetus to the development of the Ukrainian startup ecosystem. 

Let’s review the key achievements of the Fund dedicated to the 3rd anniversary of the institution. 


Today, the Ukrainian Startup Fund is one of the key organizations in Ukraine that helps Ukrainian startups in the early stages of their development to attract the first amounts of funding and launch their project. 

At the initial stage of the fund’s founding in November 2018, there was no clear understanding of the model of its launch, as it is an unprecedented institution of this format, which replaced those that have shown their inefficiency.

For the first time, the fund is built with a corporate management system and a transparent system for selecting startups, and although the fund is state-owned, thanks to independent experts, we have decentralized decision-making. The sequence and stages of selection are maintained, which, on the one hand, complement each other, and on the other hand, each stage allows verifying the previous one, while reducing the risks of bias or subjectivity.

USF model is quite unusual for the public sector in Ukraine. As an example, all processes with startup applications are fully electronic on the specialized web portal of the Fund (with the imposition of electronic signatures). This is the result of the implementation of already proven similar models, taking into account successful international practices, which are complemented by the specifics of national legislation and the Ukrainian startup ecosystem. In addition, no civil servants or other officials are involved at any stage of the startup selection process, as the market selects the market (except for the dual-purpose program, which was launched after February 24). 

Our mission is the so-called seeding, that is, creating conditions for the growth of projects. And today we are successfully fulfilling this mission. Why do we finance startups in the early stages of development? Because they have the greatest need for funding. There is a classic belief that a project is always funded by 3F – Family, Friends and Fools. And now there is a fourth F – Fund in Ukraine, – says Pavlo Kartashov, director of the Ukrainian Startup Fund.

The Ukrainian Startup Fund began accepting the first applications at the end of 2019, when the team was already formed, the terms of financing were clearly defined, a mechanism for transparent selection of startups on a competitive basis was established, a monitoring and reporting procedure for the targeted use of funds was developed. The key task was to ensure a fair mechanism for providing state grant assistance to startups:

  • USD 25k for startups at the pre-seed stage, when the startup has not yet created a viable product; 
  • USD  50k for startups at the seed stage, when the startup has a product and is ready to enter the market. 

Taking into account international corporate governance practices, the Fund has established a Supervisory Board, which includes experienced professionals with an impeccable business reputation, known in the investment and innovative business circles:

  • Victoria Tigipko, Managing Partner of TA Ventures,
  • Olena Kosharna, co-founder of Horizon Capital,
  • Dmytro Shymkiv, Ukrainian top manager in the field of innovation and member of the Supervisory Board of Kyivstar,
  • Oleksandr Borniakov, Deputy Minister of Digital Transformation for IT Development, etc.

In the structure of the Fund, it is the Supervisory Board that makes the final decisions on financing startups, selecting independent experts for evaluation and generally determines its strategy. 

The operating model actively uses partnerships and collaborations, which allows us to quickly generate new initiatives and directions. And although we have a small team, we implement a large number of projects due to our flexibility, wide network of partners, remaining an open platform of opportunities for Ukrainian startups and innovators. Any member of the ecosystem can propose an idea for a certain activity of the Fund and, provided that it meets the standards and requests, such activity can be implemented jointly with the Fund. 


Grant program of the Fund (providing grants to pre-seed startups in the amount of $25k and seed – $50k). 

The grant program was launched on December 2, 2019, and from the first days of its launch, the number of applications from startups broke records. These were innovative projects from all regions of Ukraine and in various categories – artificial intelligence, augmented reality, big data (BigData), blockchain technologies, healthcare, lifestyle, financial, educational and agricultural technologies, projects in the fields of media and advertising, industry, biotechnology, etc. According to statistics, USF funds every 27th application. This confirms the high level of selection of projects that, after receiving grants from the Fund, attracted a total of more than $ 40 million in investments and more than $ 30 million in related services. 

The first Pitch Day, which took place in early 2020, caused a wide response from the technology community and the general public. The winners were awarded by the President of Ukraine and the Prime Minister. Most of the winners of the First Pitch Day received a large number of comments, but the systematic activities of the Fund led to the fact that critics turned into supporters.  The support was especially tangible with the onset of the pandemic, when the Fund continued to hold regular online pitchings and support Ukrainian business by providing grants. 

In the same year, USF was recognized as the winner in the Impact of the Year nomination of the largest Ukrainian IT Awards, and the following year won the Best Seed Finance Fund for Fintech 2021 nomination from UAFIC. The fund has become the largest angel investor in Ukraine and Eastern Europe. USF has accumulated the largest base of Ukrainian startups at pre-seed and seed stages. Last year, the Fund held a large-scale pitching of startups (more than 122 teams) and officially set a national record: the largest pitching of startups.

In total, before the war, the Fund invested more than 250 Ukrainian startups for more than $6.4 million. 37 pitch days were held with the participation of 413 startups. The number of applications for participation in the Fund’s grant programs exceeded 4.5 thousand. Every second winner of the Fund’s grant program has already attracted additional investments in their own project.

Before the full-scale invasion, the Fund’s team managed to hold the thirty-sixth (January 28, 2022) and thirty-seventh (February 11, 2022) pitch days. For the next pitch, 12 teams were selected at the pre-session stage, and it was scheduled for February 25, 2022. Currently, 111 startup applications remain in the Fund’s database, which have been positively evaluated by experts and selected to participate in the pitching. However, due to the introduction of martial law in Ukraine, we have temporarily suspended the traditional Pitch Day. As for independent experts, as of December 2022, the Fund received 649 applications from candidates, and now the database of active experts includes more than 180 specialists.

The Fund carries out two-year post-monitoring of each grantee startup in order to understand our effectiveness – how our funds helped the project to develop. For example, we have financed startups for about $ 6.4 million. Today, according to the information we have received from startups, they have received further funding in the total amount of $ 30,000,000. That is, our efficiency ratio is about 1:5. This is not the case for all startups, of course – some received less, some more. We define an average indicator. But this is an indicator that startups are developing and continue to grow, – said USF Director Pavlo Kartashov.

Many Ukrainian startups, which at one time or another received grants from the Fund, have already scaled to global markets and became known all over the world (Upswot, Awesomic, Esper Bionics, Djooky). Subsequently, they shared their success stories in the book “20 Ukrainian startups. Success Stories”, which the Fund released and presented on the second anniversary of its activity. Indeed, Ukrainian startups are able to think and act in a new way – this is proved by the alumni of the Fund. Among them, for example, is Awesomic startup, which passed the Y Combinator program and attracted $2 million in investments. Another case is Upswot, which is supported by more than a hundred international investors, leading angels and consultants in the field of fintech. Among them are the CDO of Microsoft, former President of Western Union, Vice President of Oracle Group, Chairman of the Board of Directors of Revolut, etc. The team has already attracted $5 million of investments and reached a valuation of $20-25 million. Even under difficult circumstances, earlier – during the COVID-19 pandemic and the corresponding lockdowns, now – during the war, the resilience and ingenuity of Ukrainians is truly impressive.

Proof of this is, for example, the fact that during the 6 months of full-scale war none of the grantees of the Fund was closed. Yes, there were those who reported force majeure and inability to fulfill their obligations under grant agreements. However, today most startups have already fully resumed their work. A few more have temporarily suspended their activities since the beginning of the war, but most importantly, they have not closed. Also, during the period of martial law, the Fund continued to fulfill its obligations under contracts with startups and provided tranches of UAH 20 million. 

Even despite the outbreak of a full-scale war, Ukrainians continue to build companies, enter new markets and show incredible growth. At the same time, more and more entrepreneurs consider Ukraine an attractive country for the development of their startups – even despite the war, many companies do not stop their activities in the Ukrainian market and plan to further develop their business here, – comments Victoria Tigipko.


Acceleration Program (grants of up to $10k). 

In parallel with the main Grant Program, in February 2021, the Fund provided an opportunity for promising startups to receive funding for the training programs of well-known Ukrainian and international accelerators, including Demium, 500 Global (top 2 accelerators in the world), Baltic Sandbox, eō Business Incubators, Startup Wise Guys (top 3 accelerators in Europe), 1991 Accelerator, etc. Over the three years of USF activity, more than 80 startup teams have participated in the Fund’s Acceleration Program. 

Innovation Voucher Program (opportunity to receive up to $10k to cover expenses for international events or as a prize for winning startup competitions)

At the end of summer 2021, USF expanded the mechanisms of assistance to startups by launching the Innovation Voucher Program (promotional and prize vouchers). Under this program, the Fund continues to provide opportunities for Ukrainian startups to participate in the world’s largest technology events. Delegations of Ukrainian startups (more than 100 teams) selected on a competitive basis have already taken the opportunity to present their projects at large-scale technology events. Since the beginning of the full-scale invasion, despite the suspension of funding, the Fund has continued to organize delegations of Ukrainian startups with the financial support of partners (WNISEF, USAID, GIST, CRDF). In particular, in 2022,

  • Viva Technology in France,
  • Collision in Canada,
  • TechBBQ in Denmark,
  • Slush in Finland, SaaStock in Ireland,
  • Tech Crunch Disrupt in the United States were presented.

Ukrainian pavilions at these events always enjoy increased attention of visitors, and the presented startups expand the range of opportunities: access to certain markets, stakeholders, customers, potential investors.

Among the latest achievements of startups within the national delegations, we can highlight the fact that

  • during Viva Tech in Paris, the MISU founder pitched his idea to the President of France Emmanuel Macron.
  • The startup Esper Bionics, which presented its product at CES 2022, was recognized as one of the 200 best inventions of 2022 and was on the cover of the world famous TIME magazine.
  • WebSummit 2022 conference for the first time gathered the largest ever delegation of Ukrainian startups: 24 teams of unique projects presented their products in the international arena.
  • Moreover, during the opening of the Ukrainian stand in Lisbon, we presented a documentary about the tech ecosystem of Ukraine during the war – Made with Bravery: The Story of Ukrainian Startup, which was created by Canadian producers at the invitation of the USF team. 

Despite all the conditions, for the second year in a row, the Ukrainian Startup Fund is a reliable partner of IT Arena and financially supports the winners of the Startup Competition.

I am very proud to be part of the success story of the Ukrainian Startup Fund. In a short time, the Fund has become the largest angel investor and has financed hundreds of startups in various fields. The successful ones are Misu, a mobile application for health monitoring, Lab24, a marketplace for medical laboratory tests, Mathema, an online math school for students in grades 1-11, and many others. USF uses the best world practices and experience of the most successful countries-players of the international startup ecosystem. And the projects that received grants operate even in times of war,” – comments Deputy Minister of Digital Transformation, member of the Supervisory Board of the Fund Oleksandr Borniakov.

Grant program for dual-use projects (providing grants for projects up to $35k)

In the summer of 2022, we launched a new grant program for dual-use projects to increase the country’s defense capability and post-war reconstruction. This is an opportunity to receive non-refundable financial assistance from the state (up to $35 thousand) for projects in critical industries at this time: defense, cybersecurity, healthcare, education, infrastructure reconstruction.

Since the launch of the Dual-Use Projects Grant Program, the Fund has received 181 applications, including the top 3 industries: infrastructure reconstruction (74 applications), defense (54 applications) and healthcare (28 applications).

Representatives of relevant ministries joined the cooperation with the Fund under the program: Ministry of Education and Science of Ukraine, Ministry of Health of Ukraine, Ministry of Energy of Ukraine, Ministry of Economy of Ukraine, Ministry of Digital Transformation of Ukraine, as well as representatives of the State Concern “Ukroboronprom” and the State Service of Special Communications and Information Protection of Ukraine. 

All initiatives in the military-tech area, such as hackathons on demining or drone industry, bootcamps and many others, became possible thanks to the launch of the dual-use grant program, as it centrally and steadily receives a stream of applications in this area.

At the same time, in order to speed up the project evaluation process, the Fund has processed more than 230 applications from candidates for the program experts for dual-use projects. According to the results of the first months of reviewing applications, the USF experts, together with partners – representatives of relevant ministries, selected 20 projects – finalists of the grant program, including unique CRM systems, new types of drones and protection systems, including electricity.

Recently, together with the TA Ventures venture fund and the Ministry of Digital Transformation, the Fund has developed a map of startups with priority verticals for investment that will help rebuild Ukraine and the Ukrainian economy. The startup map contains the most important and critical sectors that need attention today – for the development of Ukraine now and in the post-war period. 

Although the war has forced many initiatives to pause, the Ukrainian Startup Fund is not only about grants. Non-financial support tools are equally important – mentoring, training opportunities, promotion, etc. The Fund regularly holds hackathons, bootcamps, workshops, Demo Days, where ministries, key ecosystem stakeholders, various international companies and organizations are often partners. 


The strategy of the Fund’s activities was developed with the support of the World Bank and provides for 4 areas of activity until 2025:

  • financial support for startups,
  • providing access to mentors and support services,
  • creating conditions for access to acceleration programs, 
  • establishing coordination between startup ecosystem participants. 

Of course, the war has made its adjustments, shifting the focus to such industries as military tech, deep tech, active cooperation with European initiatives.

Currently, we see the following key areas of development of the Fund:

Military tech as the first priority for the state, an element of reconstruction and economic development of the country.

The Fund is one of the key participants in the miltech industry and together with partners (Army of Drones, KSE, Ministry of Defense and Ukroboronprom) implements major initiatives in the field. In addition to an active program for dual-use projects, the first international Drone Hackathon was held, aimed at creating new ideas and finding digital solutions in military equipment that will help to increase the level of development of drone production and technical support in Ukraine. We received over 300 applications, of which 150 teams became participants of the Hackathon. For 72 hours, the developers worked on creating or improving their own solutions within 6 challenges. As a result, 6 winners received access to acceleration, cash rewards and still continue to work for the victory of our country. 

Moreover, in order to simplify the interaction of the Ministry of Defense of Ukraine with UAV manufacturers, we have developed functionality on the Fund’s Web portal, with the help of which each developer who owns a finished product can apply to the Ministry of Defense for approval of his product for operation. Official approval for operation means that the Ministry of Defense can purchase products, and the Armed Forces can put them in service. The main thing is that the product should have the specifications required for the army. Thanks to this algorithm, we greatly simplify the procedure for admission to operation in the Armed Forces.

For comparison: earlier the army used to accept 1-2 samples of UAVs per year, and over the past 30 days 7 samples of Ukrainian-made UAVs have been accepted for operation in the Armed Forces.

Along with this, as of 12.12.2022, the Ministry of Defense of Ukraine is considering 35 more applications for admission to operation of UAVs of Ukrainian production.

Over the past three years, the Ukrainian Startup Fund has become a real state institution that develops the country’s technological innovation industry, is recognized in the world and has a reliable connection between Ukrainian startups and the state, which is especially noticeable now with the development of Military Tech and cooperation with the Ministry of Defense, – comments Dmytro Shymkiv, member of the Supervisory Board of Kyivstar and the Startup Fund.


Strengthening the development of deep tech

The Fund has started cooperation with the European institutions: European Institute of Innovation & Technology (EIT) and European Innovative Council (EIC) to develop and support the deep tech industry in Ukraine and organized consortia to apply for participation in the EIC call to support Ukrainian deep tech startups for a total amount of $20mln. Since this autumn, we have become partners of a number of European programs, including initiatives from the EIT, Digital Europe, Horizon and COST.

For example, within the framework of work with EIT, the first Hackathon in Ukraine in the field of geology, exploration and production processes has already taken place. The team managed to gather more than 20 teams from more than 10 cities of Ukraine. Thanks to the cooperation with EIT, the European competition of innovative projects received unique applications from Ukrainian developers, and the final of the competition with the participation of representatives from Ukraine will take place at the end of 2022 in Athens. 

At Ukrainian Startup Fund, we are doing our best to ensure that the Ukrainian startup ecosystem develops even in times of war and becomes a well-known brand in the world. Observing the Ukrainian ecosystem for more than a decade, I see a clear trend – every year Ukrainian startups are becoming more successful and more recognizable among the international technology community, – says Victoria Tigipko, Chairman of the Supervisory Board of the Startup Fund, Managing Partner of TA Ventures.

The world has long discovered innovative Ukraine.

During the war, Ukraine once again proved that it is not in vain that it is in the list of the top 10 countries in the world in terms of technological skills and competencies (Global Skill Report 2022 – Coursera). And this is just the beginning. Now Ukrainian Startup Voice sounds loudly to the whole world. The ranks of Ukrainian “startup unicorns” are growing from year to year. Gitlab, Grammarly, Bitfury,, Ring still hold strong positions in the global market and promote the brand “Ukraine is innovative”. The ambitious goals of the Fund for 2023 include the organization of national delegations for the participation of Ukrainian startups in such conferences as

  • Consumer Electronics Show,
  • Startup Grind Global,
  • SXSW and TechCrunch Disrupt in the United States,
  • 4YFN,
  • TechBBQ,
  • Web Summit in Europe,
  • Collision in Canada and many others.

We will continue to do everything in our power to ensure that startups are not only born in Ukraine, but also stay here, continuing to develop the ecosystem. We want Ukrainians to be the first to benefit from startup products. To have their core here. And to make them feel comfortable working at home, where the innovative infrastructure will be developed, which can serve as a kind of magnet that will attract key players, their experience and money to Ukraine. The expertise accumulated over 3 years of independence, complemented by military realities, incredibly talented human resource with insane motivation. Over time, I am sure, Ukraine will become the main startup hub in Eastern Europe,” Pavlo Kartashov said.


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