Tech talent shortage is gradually becoming a global problem. According to a CIO survey by KPMG, 65 % of nearly 4,000 surveyed IT leaders report the lack of software engineers in their area. However, the modern world of technology makes it easy for you to hire a web development team outside the country where your business or startup is based.
There is a wide range of locations where you can find an offshore development team. If we compare the offshore software development rates by country, we can see that Asia and Eastern Europe offer the lowest rates. However, such low rates have no negative impact on the quality of work, because the cost of living in these regions is also lower.
In this article, we are going to talk about offshore software development in Ukraine, an Eastern European country with a huge potential to become a global leader in the IT outsourcing domain. We will also give some helpful tips on the best ways to build an offshore development team in Ukraine.
Ukraine Software Outsourcing: Facts and Statistics
Ukraine is one of the best countries to outsource software development, and here’s why:
- The country features over 1,000 IT companies with almost 116,000 qualified software engineers, and this number is predicted to grow more than twice in 2025. That is because around 15,000 IT talents graduate from Ukrainian technology universities on a yearly basis.
- In 2017, the Global Sourcing Association (GSA) named Ukraine the “Outsourcing Destination of the Year“.
- A yearly overview of software development companies in Ukraine predicts the growth of the country’s IT export up to $ 4.5 billion by the end of 2018.
- Ukraine is featured in Gartner’s top 30 countries for offshore services and other similar ratings, such as SkillValue and Clutch.co.
- Ukrainian software engineers are recognized by SkillValue among the world’s best with an average score index 91.26%.
- Ukraine is located in the middle of Europe, so you can easily reach it from almost anywhere. Today more and more flights are launched to the major cities of Ukraine.
- As of 2017, Ukrainians can travel to the EU countries without a visa. It means that now it is easier for Ukrainian offshore developers to personally meet with their partners and clients in Europe.
- Software giants such as Microsoft and IBM have established their R&D centers in Ukraine since 2003 and 2006, accordingly.
- Ukraine is the world’s third country by the number of certified IT specialists.
- An average cost of software developer services in Ukraine ranges from $ 20 to $ 40 per hour whereas the quality of their work still remains excellent. Building an offshore development team in Ukraine is much cheaper than in the United States but it doesn’t affect the quality of the code. Therefore, IT businesses in the US prefer outsourcing to Ukraine because it is hard to find such a perfect price/quality ratio locally. By the way, 80 % of software development services that are outsourced to Ukraine are ordered from the USA.
Ukrainian Developers: Tech Skills and Soft Skills
Ukrainian developers are extremely innovative, tech-savvy, and always eager to learn about new technologies on the market. Numerous country-wide tech events, hackathons, meetups, and conferences such as the iForum take place in major Ukrainian cities – Kyiv, Lviv, Kharkiv, Dnipro, and Odesa – almost on a daily basis. Besides, Ukraine is famous for its educational initiatives, courses, and boot camps in the software development domain, which are suitable even for beginners. So it is not a surprise that the Ukrainian IT market is full of brilliant tech talent. By the way, Ukraine is a home for successful global startups and software products like Grammarly, Depositphotos, Petcube, Preply, and many others.
According to a survey by DOU, the biggest portal for software developers in Ukraine, the country’s most popular programming languages as of February 2017 are:
Having Python in this Top 5 is a good trend, meaning that the Ukrainian developers are geared towards the growing popularity of machine learning and data science – technologies of the future.
As for soft skills, Ukrainians still have room for improvement when it comes to communication, strategic thinking, and project management. However, they are quickly adopting western values, and most of them are fluent in English. Additionally, tech talents in Ukraine are open-minded, honest, and trustworthy. Outsourcing companies in Ukraine are more likely to establish long-term business relationships with their partners in Europe and the US.
Building an Offshore Development Team in Ukraine in 2020
So you have decided to hire a web development team from Ukraine and collaborate with them on a remote or semi-remote basis. The second step after this important decision should be finding out the potential problems and challenges that may be waiting for you, just to be forewarned and forearmed. Now we will outline some of those possible issues and explain how the country is working on solving them.
Offshore Development Team in Ukraine: Challenges
- Corruption. Unfortunately, corruption one of the biggest problems that can hamper Ukraine outsourcing and local businesses. Corruption in Ukraine roots back to the times of the Soviet Union and numerous financial crises that devastated the country, and it still remains in some state institutions. However, now Ukraine is recovering from those hard times, and the new government is making efforts to fight corruption. For example, in 2014 the country established the National Anti Corruption Bureau (NABU). In 2016, the Prozorro (Transparent) e-procurement system was launched. Besides, now all civil servants should declare their income electronically. Finally, the Ukrainian government has started implementing blockchain technologies for more efficient anti-corruption measures.
- Political situation. The ongoing conflict in Eastern Ukraine can push away the businesses and startups that are seeking developers in Ukraine. However, the country is relatively big, with large distances between cities, and the conflict is taking place far away from the major IT hubs. For example, it is faster to get from Lviv to Prague or Krakow than to Donetsk, a city which is closest to the conflict.
- Lack of support for investors. Until recently, the business climate in Ukraine has been not very favorable for foreign investments. However, since 2014 the country has started improving the business conditions, including the ones for investors. As a part of the government’s Strategic Action Plan 2020, organizations such as UkraineInvest, Government Commissioner for Investments, and Business Ombudsman Council were established. As a result, investments in Ukrainian IT companies over the past 5 years have amounted to $ 630 million.
Offshore Development Team in Ukraine: Hiring Options in 2020
There is a wide variety of options for hiring a dedicated software development team in Ukraine. However, it is important that you carefully consider those options and any possible risks that they may entail before you make a final decision. So there are the following ways to hire software developers in Ukraine.
Software Development Agencies
Partnership with local software development agencies is probably the most traditional way of finding and hiring an offshore development team in Ukraine. Many offshore development agencies in Ukraine also offer collaboration on the outstaffing basis, which means more flexibility and control over the project and its scope. Collaboration with a local software development agency or outstaffing company typically involves the following stages:
- Initial contact with the local company representative to study the customer’s requirements. The customer describes the project, sets the deadlines, and specifies the skill set that is needed to successfully complete this project.
- The local company starts searching the available talent pools for suitable candidates.
- The talent acquisition specialist at the local agency interviews the shortlisted candidates and then schedules the interviews with the customer.
- The customer interviews the candidates.
- The customer hires the candidates whose skills were confirmed during the interview.
The local software development agency provides all working conditions for the hired developers, such as office, equipment, medical insurance, vacations, and so on. Depending on the project, either the customer or the local company in Ukraine can provide the project manager.
Pros: Reliability. A dedicated software development team that works together in one place and in the same country. The local company handles all of the management issues.
Cons: Lack of flexibility – any changes to the project should be approved with the agency. For example, it is almost impossible to change the technology stack in the middle of the project. Besides, the services of a software development agency may cost a lot, as they include the back office handling expenses.
Local Recruiters in Ukraine
You can collaborate with a Ukrainian recruiter who will find you the best offshore development team in Ukraine for your project. A local recruiter already has a large base of tech talents available and can act as an intermediary between the client and the developers. The workflow is typically as follows:
- You share your project requirements with the recruiter.
- The recruiter checks their curated talent pool for available developers.
- The recruiter schedules the interview with the shortlisted candidates that meet your requirements.
- The customer interviews the candidates.
- The customer hires the candidates that have passed the interview and suit the requirements.
Pros: Access to a larger talent pool of experienced offshore software developers. Saved time on searches.
Cons: It may take a long time to recruit a dedicated team of software developers in Ukraine, sometimes even up to 6 – 8 weeks, depending on the number of engineers needed and their technology stack. In addition, the Ukrainian software development market is highly competitive, meaning that the developers can have lots of offers and may not respond to all of them.
Another way to hire Ukrainian IT professionals is to look up their profiles at freelance portals. Here’s how it works:
- The customer registers at a freelance portal as an employer.
- The customer looks for freelancers in the following ways:
- looking up freelancer profiles according to the requirements and the skill set that is desired for their project and sending them invitations,
- publishing a project description and have the freelancers apply for this job.
- The customer reviews the job applications or responses to the invitations, schedules the interviews the applicants, and chooses the most suitable candidate.
- The customer creates a job offer for the developer that has successfully passed the interview.
- The developer accepts the job offer.
- The contract is created and the customer starts their collaboration with the freelancer.
The freelance software developers in Ukraine typically work remotely either from home or from a coworking space. The customer has to form the entire team from scratch, and the members of this team can be not only from Ukraine but also from other countries.
Pros: Cost efficiency, access to a large talent pool, direct collaboration opportunities.
Cons: It may take lots of time to find each developer to form a dedicated development team using freelance portals, like Upwork, and this option is more suitable for smaller projects. It is also difficult to manage the team of freelancers that are scattered all over the world. Besides, sometimes it may happen that a freelancer disappears without any explanation, and this will negatively impact the entire project, especially when the deadlines are tight.
Tech talent marketplaces connect their clients with the best software engineers from web development shops – companies that unite developers specializing in different technology stacks and working on several projects at a time. Founded in Ukraine, YouTeam is a marketplace for offshore software development teams, which carefully picks the best tech talents for their clients from the world’s best web dev shops. Let’s see how this marketplace works in more detail.
YouTeam Marketplace of Offshore Software Development: How It Works
YouTeam collaborates with the software development teams from dev shops in Latin America and Eastern Europe, acting as an online marketplace for businesses and startups that are looking to hire tech talent. There are hundreds of curated teams and individual software developers across all technology stacks in our talent pool.
- You submit your project information on the platform. Filling the form usually takes up to 2 minutes.
- After the form is submitted, we start sourcing the best candidates for your project and will send you first handpicked profiles in 48 hours or less. We are proud to list the best full-stack, front-end, back-end, mobile, blockchain engineers as well as DevOps, Machine Learning specialists, and WordPress developers. Additionally, you can look for QA and UX / UI design teams.
- Having selected a suitable team, you are interviewing its members before you make a final decision.
- After successful communication, you sign the contract and start working with offshore development team via YouTeam.
- All payments to the dev shop go through YouTeam’s security account. At the end of each servicing period, you have some business days to review and comment on the work performed. In case of any objections, the invoiced funds remain frozen on the security account until the issue is resolved.
Why Choose YouTeam to Build Your Offshore Development Team?
YouTeam gives a range of competitive advantages to businesses and startups looking for software developers in Ukraine and other countries. Specifically, these benefits are as follows:
Curated List of Best Offshore Development Companies
Each web or app development shop can join YouTeam only by invitation and must go through our vetting process, which consists of the following stages:
- We search for web development agencies (vendors) from all over the world and select only the best ones, based on their history, external ratings, experience, track record, and so on.
- We schedule several calls with the vendor representatives. If it is possible, we can even visit them onsite to meet other team members personally.
- We analyze the legal, HR, and management documentation as well as the best practices of the firm to find out how the top management treats their employees, and what is their product development process like.
- Each software development engineer at the webshop undergoes several stages of a screening process, which is carried out by our partner vendors.
- You interview and assess the developers and their skills with the help of dedicated managers at YouTeam.
YouTeam does not accept any discrepancies between the advertised skills and actual performance of the developers. If it happens, the responsible vendor is blocked at the platform with no chance to come back, and the client gets a refund for the latest invoicing period.
Dedicated Software Development Team
Each software engineer registered with YouTeam is not a freelancer, though they are working remotely. Actually, they work on a full-time basis for the vendor agency that you are contacting. It means that the developers which you hire through YouTeam will dedicate all of their time to your project. We treat our clients and their projects very seriously, so be sure that our Ukrainian developers, as well as IT specialists from other countries, have already undergone a strict vetting process. Finally, you can find only upper-middle and senior developers on YouTeam, meaning that in most cases they will deliver the work of exceptional quality.
Offshore Development Teams Ready to Start Immediately
You will not have to wait for months until your team is formed, as it may happen with other hiring options for Ukraine outsourcing. After you register with YouTeam and our advisor personally approves your account, we unlock the access to the profiles of developers belonging to the ready-made teams from our curated web dev shops. All of these professionals are ready to start working on your project within two weeks maximum.
Flexible and Scalable Offshore Development Teams
Unlike traditional software development agencies that form the team only once, YouTeam offers a more flexible model that allows you to quickly scale the team. This is especially good for startups and growing businesses. With YouTeam, you can de-scale the team in the course of two weeks.
With YouTeam, you will not need to pay any recruitment fees, because we charge the commission to our vendor web dev shops. YouTeam’s cooperation model is a win-win situation both for the dev shops and our customers because the dev shops pay for a completely new channel for finding clients. Therefore, our customers use our platform free of charge and pay only for software development services.
Assistance with Project Management
We at YouTeam can help with the project management side. Our dedicated Account Manager will support the organization and management of the project kick-off, ensure healthy cooperation between dev shop and customers, help with invoices and payments, and support of agreement changes if any needed.
Offshore software development in Ukraine: FAQ
What are the risks of software development offshoring in Eastern Europe?
While tech companies from the United States, United Kingdom, and Western Europe more often prefer outsourcing software development to Eastern Europe over Asia, there are still certain risks involved. For instance, clients from outside Eastern Europe may get confused with the complicated taxation and money transfers. Sometimes they also have to deal with ambiguous billing methods set by the dev shops. The solution is to hire through a tech-talent marketplace, which will ensure that the outsourcing process is smooth.
How to set up an offshore development center in Ukraine in 2020?
An offshore software development center is a software company that is based in a country other than the headquarters country. Such centers typically function as an extension to the in-house development team. The process of establishing an offshore software development center in Ukraine from scratch may involve the seven steps described in detail in this article.
What is the mentality of people who work in the Ukrainian IT industry?
Ukrainian cities are increasingly adopting European values, spearheaded by the country tech hubs such as Lviv, Kyiv, Kharkiv, and Odesa. Ukrainian dev shops are more focused on establishing long-term relationships instead of trying to make a quick buck, which is proved by the countless examples of large companies outsourcing software development to Ukraine for decades. In terms of the personalities of people employed in the tech sector in Ukraine, they are mainly down to earth and friendly. In this research about Ukrainian software developers in 2020, you can find even more insights on this topic.
The Bottom Line
To summarize, here’s what you need to know about building an offshore development team in Ukraine:
- Ukraine is among the best countries to outsource software development because of a large tech talent pool, high quality of work, and reasonable pricing. For example, the Global Sourcing Association (GSA) named Ukraine the “Outsourcing Destination of the Year” as of 2017. Besides, Ukrainian developers have expertise in all technology stacks and are always ready to learn new technologies, data science in particular. With a dedicated offshore development team in Ukraine, you can outsource your projects and extend your business capacity while decreasing the operational costs of your company.
- If you decide to build an offshore development team in Ukraine, it is important to know about certain challenges that you may encounter, such as corruption or lack of support for startups and investors. However, the country has been actively working to fix those issues since 2014, and now we can see significant progress.
- There are several ways to hire software developers in Ukraine, such as collaboration with traditional software development agencies, freelance portals, local recruiters, and tech talent marketplaces. YouTeam offers a unique tech talent marketplace that gives its clients access to a large pool of programmers that are employed at carefully vetted web development shops on a full-time basis.
- Hiring developers through the YouTeam marketplace has a range of competitive advantages over the other available ways of Ukraine software outsourcing. YouTeam provides a curated list of highly skilled programmers from the best dev shops. Unlike traditional outsourcing agencies, the developers become available for the project within the next two weeks. The YouTeam platform is free of charge for the clients because the dev shops pay for the services. The developers are dedicated only to the client’s project but they are quite flexible in terms of team scaling. Finally, each vendor shop that collaborates with YouTeam undergoes a strict selection process that consists of multiple stages.
Therefore, a tech talent marketplace is currently the most cost-efficient and reliable way to hire web, mobile, back-end, front-end, or full-stack development teams from Ukraine and other leading outsourcing countries.
If you looking to hire developers, contact us – we would love to share our expertise.