Choosing Ukrainian Company for Offshore Software Development : How to Do It Right

Technical talent shortages and high rates are critical issues for today’s IT industry. It’s becoming increasingly difficult to form a solid team with a realistic budget in the US, not to mention hiring expenses. According to The US Labor Department, the global shortage of software engineers may reach 85.2 million by 2030. These statistics emphasize the need to search for tech talents abroad.

Offshore software development is the best solution in this situation, especially if it concerns cooperation with Ukrainian companies. In fact, by 2030, the global offshore software development market is expected to reach over $283 billion, with an impressive CAGR of 10.13%. So, let’s discuss successful Ukrainian projects, the specifics of choosing a company for outsourcing development services, and the main requirements for offshore developers.

Customers increasingly choose Ukraine for the offshoring of custom software development services. Often, the prices are not as crucial as the examples of successful startups and products with real value. There are many such examples in Ukraine, so we’ll discuss a few of the most relevant ones.

Grammarly

Very successful Ukrainian startup that was able to receive $400 million in funding from investors precisely because of its value and product uniqueness. Grammarly is used worldwide and had 30 million daily active users in March 2024.
The service for grammar and plagiarism checking, text improvement and adaptation has proven to be very practical and incredibly helpful for users across the word.

Reface

You could read about this startup on Elon Musk’s Twitter. The ML and AI-based app provides access to fast and accurate face-changing technology. Users can create any deepfakes from images, photos and videos. It became the app of the year in Google Play and has 100 million installs per year.

Petcube

App for pet care allows you to manage the feeding process directly from your smartphone, as well as monitor your pets, communicate with them and shoot videos. Petcube has a global presence, with users benefiting from its AI-driven features such as smart alerts for sounds, motion detection, and more.

People.ai

A unique application based on AI allows you to analyze the performance of the sales department, identify weak points and give recommendations for improvement.

Despite all the obstacles and adverse conditions, the number of successful Ukrainian projects is growing every year.

Ukraine is not just open to offshore cooperation – the government supports this in every possible way because it provides new jobs and contributions to the national budget. However, this is not the only reason you should choose Ukraine for offshoring IT services. Let’s overview some key indicators of the Ukrainian IT market:

• IT services have grown significantly in recent years and are now a vital export segment, accounting for 13.2% of total exports.
• As reported by Statista, the Ukrainian IT services market is forecasted to reach $3.42 billion in 2024. With an expected annual growth rate of 6.11%, the market is set to continue its positive trend, reaching $4.60 billion by 2029.
• 2,150 active verified IT companies operate in Ukraine, according to the IT Research by Lviv IT Cluster
• 247k tech specialists are based in Ukraine
• 2,600 startups as of January 2024 emerged in Ukraine. In recent years, at least six companies with a billion-dollar valuation have emerged. This trend indicates the overall development of the startup ecosystem and its potential unlimited prospects.

As we’ve reviewed some general information about Ukraine’s IT market status, let’s dive deeper into concrete points as to why you should build your offshore development team in Ukraine. Wondering what are the main benefits of choosing an offshore development model in Ukraine? Let’s consider some of them.

English proficiency

According to research by the IT Ukraine Association, more than 80% of Ukrainian IT specialists have an intermediate or higher level of English. This unconditional advantage makes communication smoother and more efficient.

Vast talent pool

87% of Ukrainian IT specialists have a higher quality of technical education and quite serious experience developing IT products. This is possible thanks to affordable university programs and a whole ecosystem of non-formal educational IT institutions. In addition, the country has many resources for tech research. Such giants as Microsoft, Oracle, Wargaming, etc., have R&D centers here.

High qualifications

Ukraine is famous for driving the global technology market. This is due to the large number of highly qualified IT experts. >83% of the entire pool of technical talents consists of specialists with qualifications at the Middle, Senior, and Lead levels. Moreover, 42.6% have general work experience in the technology sector of more than 6 years, while 7.8% have over 15 years of experience.

Services and technologies diversity

Ukrainian IT companies can provide all the common services your business might need. These include custom software development, web and mobile development, cloud services, embedded development, QA services, UI/UX, as well as the latest technologies such as AI, AR/VR, IoT, Big Data and blockchain. Equally important is the extensive expertise in various industries, such as real estate, healthcare, EdTech, FinTech, and much more. Thus, you can expect a full range of services from offshore software development in Ukraine, including top-notch approaches and technologies.

Cultural compatibility

One of the biggest benefits of working with a Ukrainian IT company is cultural similarity to European culture. Developers from Ukraine have a strong sense of responsibility and are diligent with tasks and deadlines. They have solid communication skills and a proactive approach, which can result in additional engagement in your project and sharing ideas to make it better.

Lower developers rates

Considering the experience and level of Ukrainian IT specialists, the cost of their services is quite low. This is due to the low cost of living, rent, etc. At the same time, the quality of the provided services remains at a high level. Compared with Canada, the USA, and Europe, the salary rate in Ukraine can sometimes be a few times lower since the average hourly rate of a local IT specialist ranges from $20.

Business-friendly environment and regulations

The ambitious Diia.City project is a unique solution for the digitization of tax administration. It significantly simplifies obtaining work permits for foreigners, provides loyal tax conditions, etc. Even if the offshoring company is not connected to this system, the regulations and taxes are pretty advantageous.

Time zone compatibility with Europe and the U.S.

One of the most crucial benefits of offshoring software development to Ukraine is its alignment with both European and U.S. business hours. It enables comfortable real-time collaboration, allowing for efficient daily communication and seamless coordination on project tasks, feedback, and troubleshooting. Such compatibility provides clients in these regions with the advantage of a nearshore experience, providing smooth teamwork and faster response times.

To sum up, Ukraine is a great choice for offshore software development due to its skilled tech talent, cost-effectiveness, and convenient location. With a highly educated workforce proficient in diverse fields and strong English skills, Ukrainian developers offer quality services at quite competitive prices. The country’s tech ecosystem and modern infrastructure support efficient project management, while its time zone compatibility enables smooth collaboration with Europe and the USA. Ukraine is an ideal partner for companies seeking reliable, high-quality software development services.

1. Leobit. In 2024, Leobit won the Silver Stevie Award in the category of Customer Service Department of the Year, which highlights its customer-centric approach and the high standards of IT services. It has also been ranked Among the Top 1000 Global B2B Service Providers in 2023 and recognized as a Global Top 100 Sustained Growth Company by Clutch in 2022. Leobit has Microsoft Gold Certified Status, ISO 9001:2015 and ISO 27001:2013 certificates, which confirm the compliance of development practices with internationally recognized standards and a systematic approach to quality assurance. The company is also recognized #1 IT employer in Lviv, Ukraine. An excellent option for offshoring due to a large talent pool, established interaction system and sufficient experience.
2. SoftServe. The world’s largest IT-company with Ukrainian roots that provides the full list of software development services for large enterprises. SoftServe has its own educational centers and social initiatives and is part of Ukraine’s non-formal technical education system.
3. TechMagic. A software development company with a narrow technology focus on MEAN stack and Salesforce development services.
4. Devspiration. A small industry company specializing in creating software for the financial area. The main direction of development is individual solutions based on the Microsoft platform.
5. Intellias. One of the largest companies in the country. Provides consulting and research, technology adoption services, product development, etc.Leobit team will be pleased to answer all your questions regarding offshore software development. Contact our experts.

Ukraine offers many options, but choosing a professional company that can share your business values ​​and takes responsibility for its services’ quality is essential. Of course, the picking criteria depend on the peculiar characteristics of your product and business approach. However, several points are crucial in any case.

• Pay attention to customer reviews
  You can find them on such resources as Clutch or GoodFirms. Here, clients can give detailed feedback on cooperation, indicating real projects, shortcomings and advantages.
• Discuss the company’s experience and development approach
  Does it use agile processes? How does it comply with the set business requirements and deadlines? How can the team guarantee the result? The clearer the answers, the greater the chances that the offshore software development team works as a single coherent mechanism.
• Choose the most appropriate pricing model for your business
  There are free common pricing models in IT outsourcing: Dedicated Development Team, Time and Material, and Fixed-price. Which to choose depends on your project duration, size, flexibility, and budget.

• Check if the company has international security regulations and certifications
  Look for certifications such as ISO 27001 for information security management, GDPR compliance for handling personal data, and PCI DSS for payment processing security. Such certifications demonstrate that a company has implemented security measures and best practices for data collecting and processing.

When choosing a company for offshoring, it is also essential to understand what principles it is guided by. Here are the main three.

Individual solutions

A properly formed offshore development team based on the client’s business needs and goals is already half of success. Each participant in the process must have the right skills, experience and responsibility.

Transparency and reporting

The clients must have access to all the development data and the level of control they need, which requires transparency in communication and regular reporting.

Fair prices and respect for the approved budget

A professional offshore development company will strictly adhere to the agreed budget and, in case of possible deviations from it, report to the customer about every little thing.

It is also vital that the outsourced team easily integrates into the development process and allows you to manage your resources at your own discretion.

Ukraine is an excellent option for offshoring development services due to low developer rates, a vast talent pool and quality technical education. However, it’s worth choosing a company with positive customer feedback, agile development methods and a transparent communication system.

Leobit meets all these criteria. We’ll be pleased to answer all your questions. Just contact us in any convenient way.