Launching a startup is always a challenge, and one of the main issues entrepreneurs face is funding. Where to find capital for growth? Should you attract venture investors, or is it better to build the business using your own resources? Ukrainian startups have diverse experiences in this regard.
Advantages and disadvantages of venture capital
Many successful startups have attracted investment from venture capital funds. This enables rapid business scaling but also carries its own risks.
- Pros: rapid growth, access to resources and contacts, the ability to focus on product development.
- Cons: loss of business equity, dependence on investors, risk of strategy shifts under fund influence.
Bootstrapping: a strategy for slow but steady growth
Some Ukrainian startups have chosen a path of development without external investment. They rely on their own profits, minimize expenses, and avoid risks.
- Pros: full control over the company, no pressure from investors, independence in decision-making.
- Cons: slower growth, limited budget for marketing and development, difficulty entering international markets.
Examples of Ukrainian startups
- Preply – an educational startup that raised $100 million in investment and entered the international market.
- Esper Bionics – a biotech startup developing innovative prosthetics.
- Reface – an AI app that gained global popularity thanks to its face-swapping technology.
- DressX – a digital fashion platform growing without major investors.
- Liki24 – an online medicine delivery service that attracted investment from European funds.
What is better for Ukrainian startups?
- Venture investment is suitable for companies aiming to capture the market quickly.
- Bootstrapping is better for startups that want to operate long-term without the risk of losing control.
- Hybrid model – obtaining grants or strategic partnerships without losing full control.
The key is to choose a funding model based on business goals and scale.
Are Ukrainian startups ready to build a business without external investment? 🚀
Sergiy Balashuk, Director of IQusion, expert at Software Ukraine