Ukraine as the Best Software Development Destination: Facts, Statistics and Successful Cases

Jan 18, 2021·9 min read

Software development outsourcing to Ukraine attracts plenty of attention. Get acquainted with the local engineering talents, find out what companies outsource app development to Ukraine and estimate how much you can save with this method.

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Software development outsourcing has proven to be a brilliant method of delegating specific tasks. Massive enterprises and small startups consider this option to save money and get an impeccable product’s quality.

However, once you’ve decided to delegate your next project to a team overseas, a significant question emerges: where to outsource software development? What region would be the most suitable in terms of costs, cultural similarities, convenient time zones, etc.? What region has a solid background in providing this sort of service? Where can you find professionals you can trust your unique product to?

Today, you are going to find out about one of the top outsourcing destinations in the 2020s.

Ukraine software outsourcing has been gaining popularity since the early 2000s, when major IT companies started to grow and look for talents all over the world. Twenty years later, Ukraine receives recognition from numerous international institutions, world-known companies, and rising startups. Have your cup of coffee and discover all the reasons outsourcing software development to Ukraine may become your best business decision.

A quick look back: in-house development vs. outsourcing

If you still hesitate if it’s worth it to look for contractors, organize work with an outsourcing team, let’s start with a quick summary of why outsourcing is a good and profitable idea.

  • Short time-to-market

Workable says it takes more than 30 workdays to hire a qualified software engineer in the US. Depending on your project’s needs and requirements, you may invest months in the search and interviewing process.

If you plan to handle it yourself, it may take too much time and energy to hire an entire team. If you delegate this task to the recruitment team, it may cost you thousands of extra dollars.

These factors postpone your product launch. And a short delay may give a head start to your potential competitor.

Development outsourcing saves you from the wasted time: you find a team, you discuss the essentials, you start the development process.

  • Cost optimization

In a previous point, we’ve drawn your attention to costs for the recruitment process. Add office rent, hardware, and software needed for effective engineering processes. Think about employees’ salaries: no matter how many hours an engineer takes part in the process, you need to pay an entire monthly salary.

We highlighted this in our article devoted to cost for app development. Take a look at details and numbers.

The outsourcing method allows you to pay only for the real work done. No extra costs are required: you pay for what you get. Cutting unnecessary expenses is significant in the initial stage of your business growth.

  • Focus on business process

The outsourcing team doesn’t demand your direct participation in all of the processes. You can always join a particular meeting or discussion, but also you can save your time and focus on business growth, promotion, and PR.

  • Financial attractiveness

Statista analyzed leading countries in offshore business services and provided impressive results. Although the US heads the list, it is one of the less profitable options in terms of costs. Software engineer’s salary in the US is approximately 300% higher than in Ukraine.

With limited resources, you may find the outsourcing option much more attractive. Keep reading; we’ll consider the price for an entire project and calculate how much exactly you can save a few blocks below.

  • World-class product’s quality

Lower prices for development services may cause some suspicion. Would the cheaper outsourcing product demonstrate the same quality as the more expensive one, built in-house?

Yes, it would. And even more: in terms of quality, the software outsourcing team may demonstrate much better results. The reason is simple: when you hire an in-house specialist, the recruitment market is limited, and you must find an employee in a defined city. Looking for an outsourcing provider, the best professionals on the planet may contribute to your product.

Recently, we prepared a definite guide on the pros and cons of software development outsourcing compared to in-house development. Make sure to check it before you dive into Ukraine software outsourcing market specifics.

Outsource software development to Ukraine: facts and numbers

Now, let’s shed some light on the critical reasons you should consider Ukraine as the next destination for your project outsourcing.

#1 outsourcing market in Eastern Europe

Outsourcing Journal has named Ukraine the #1 digital, technology, and IT destination in Central and Eastern Europe.

In 2018, the total volume of outsourcing services in Eastern Europe exceeded $13 million. $4.5 million is the Ukrainian outsourcing market contribution.

Compared to other Eastern European countries (Poland, Belarus, Romania), Ukraine demonstrates fantastic growth rates. Supported by an attractive tax policy, powered by skilled talents, the Ukrainian outsourcing industry strengthens its positions and attracts even more attention.

One of the primary features that describe the IT outsourcing market is the accelerated growth in the number of specialists, IT agencies, and startups.

#2 by the number of engineers in Eastern Europe

In 2020 The number of IT specialists in Ukraine exceeded 220,000. For comparison, in 2016, it was 100,000. The country is the second-largest market in Eastern Europe by the number of specialists.

number of it specialists in ukraine

Ukrainian outsourcing market not only survived the pandemic-caused crisis, it even ensured its stable growth

Thousands of software engineering agencies

There are around 12,000 companies providing software development services. In 2014, there were 7,000 companies. Most of them are located in Kyiv, Kharkiv, Lviv, and Dnipro. 46% of IT specialists work in the outsourcing industry. 56% of specialists work in product development companies or as outstaff employees.

More than 100 R&D centers are located in Ukraine.

Huge number of viable startups

The particular role in the Ukrainian IT market belongs to striking startups. The country is an attractive destination for foreign investors who actively support innovative products and exceptional minds.

  • Attendify, a mobile virtual events app, was found in Ukraine. Leaders like Google and Bloomberg head the list of Attendify customers.
  • Grammarly, an AI-powered writing assistant, was first launched in Ukraine. The startup raised more than $110 million in funding.
  • Readdle productivity app was downloaded more than 100 million times.

All these small puzzle pieces build a vivid picture: a vibrant community of talented Ukrainian specialists grows year by year. The number of IT companies increases, and foreign companies don’t hesitate to outsource their R&D centers to this destination. Ukraine is not just powerful in terms of human resources; the country is also attractive for investors.

Outsource software development to Ukraine: the talents

Now, take one step closer to outsource software development to Ukraine by getting acquainted with the Ukraine developers.

  • Technical education

More than 84% of software developers and 39% of QA engineers and software testers in Ukraine have a technical education. Annually, more than 30,000 students graduate from technical educational institutions. More than 12% devote time to self-education. Another feature of the Ukrainian IT industry is that not only state educational institutions teach young technical talents. There are also many private IT schools that help to study programming, design chor IT-related fields, and start a career in IT companies.

  • Experience

36% of IT engineers in Ukraine have five to ten years of experience. At the same time, more than 10% of respondents started working in the IT industry a year ago. There is an impressive number of senior and lead level professionals who, in turn, can share their knowledge and experience with junior specialists. The community combines years of experience with innovative minds and young ambitions to deliver the best results.

ukrainian developers' job experience

No matter what sphere you would like to improve with your product, it is very likely that in Ukraine, you can find a team with substantial experience in it.

Many specialists are involved in eCommerce projects development, but products for other industries are still common.

it outsourcing companies

  • Skills

Ukrainian software engineers are also skilled in numerous programming languages. Most of the specialists define JavaScript as the primary programming language they use. And that’s nothing new - JavaScript keeps a stable position being the most popular language worldwide. Java, C#, and Python continue the list. Meanwhile, Ukrainian engineers are also skilled in such rising stars as Rust or Erlang.

ukrainian app developers' skills

The talents not only enhance their knowledge in the primary field but also follow development trends and utilize cutting-edge tools in their pet projects.

Effective teamwork is impossible without creative designers and skilled testers. Effective product promotion is hard to reach without a professional marketing team. In Ukraine, software engineers are not the only specialists able to contribute to your product.

ukrainian tech talent pool composition

  • Fluency in English

Another critical factor entrepreneurs may be concerned about is the language barrier. But that’s not about the Ukrainian market: in Ukraine, more than 70% of engineers demonstrate Intermediate or Upper-Intermediate English level. More than 12% speak advanced English. Impeccable English enables flawless communication with foreign teammates. As most of them work in outsourcing companies, daily contact with international teams is nothing new. Utilizing the Agile approach and Scrum framework for effective work organization, specialists are used to frequent meetings and both verbal and written communication in English.

Outsource software development to Ukraine: other factors

Now when you’ve got a portrait of Ukrainian IT specialists, take a look at a couple of more reasons to outsource software development in Ukraine.

  • Time zones

The geographical location is another reason to give your preferences to Ukraine. No matter where you have your head office, you can still arrange a meeting convenient for you and your outsourcing partner.

ukraine time zone

  • Convenient hub

Convenient flights among Ukrainian, European, and US cities make the country a perfect destination for convenient business trips. Just a couple of hours - and you are on a face to face business meeting with your team.

EU, UK and US citizens can travel to Ukraine visa-free.

travel time between ukraine and other countries

Costs for software development in Ukraine

Earlier, we’ve mentioned that Ukraine is extremely financially attractive. Now, take a look at real numbers.

The prices for software engineering services in Ukraine are several times lower in comparison to the US, UK, or Germany. Affordable prices are one of the key reasons the US, Western Europe, and the Middle East companies outsource their software development to Ukraine.

The difference varies from case to case. However, if you are ready to invest hundreds and thousands of work hours in your product, every small detail matters.

To make things clear, let’s set up a situation. You plan to build a web-based startup MVP. You need two software engineers, a software tester, a designer, a business analyst, and a project manager to contribute to your project. Here’s the approximate cost you need to invest in it:

On-site development in the US

Outsourcing development to Poland

Outsourcing development to Ukraine

$140,000+

$45,000+

$35,000+

Keep in mind that no matter where your team is based, you still get the same project.

These are skills, dedication, and experience that matter, not a geographical location.

In conclusion

Numerous enterprises outsource software development to Ukraine.

  • Samsung has an entire research and development institute in Ukraine
  • In 2020, Google officially started its R&D center here as well
  • Famous fashion brands like Versace and UnderArmour outsource app development to Ukraine

“Ukrainian specialists can compete on equal terms with service providers from all over the world, and in fact, they’re doing very well. Many of our clients are a great example of companies who started out with just a few employees and then grew substantially.”, says Michael Deinega, Payoneer Country Manager.

At the same time, outsourcing is an excellent option for small businesses and startups.

  • A startup with a distributed team worldwide extended the team with D3.js specialists from Clockwise Software
  • UK startup outsourced the entire MVP development to the Ukrainian team
  • The online marketplace Whitelane outsourced tasks related to app architecture and turned to a white-label product

Outsourcing to Ukraine opens numerous opportunities for your business:

  • Hire a dedicated software development team
  • Extend the engineering team you work with
  • Outsource a startup MVP development to test your concept with minimum expenses etc.

The choice is vast and promising. So take the first step and start working on a brilliant project with your outsourcing team based in Ukraine.

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