THE WAR IN UKRAINE: THE CRISIS OF INNOVATIVE STARTUP

Keywords: venture investment, financing, innovative startup, investments, innovations, investment climate

Abstract

As a result of the two-year pandemic and the Russian invasion, the technology startup industry is suffering from the crisis, which makes this study timely and relevant. The purpose of the article is to identify problems that hinder the creation and development of startups in Ukraine, justify public policy measures, the implementation of which will stimulate the development of national startups. The article describes the stages of development of venture capital investment and the main sources of their financing, indicates the possible risks of underfunding of each of the presented sources. The need for systematic control of funding at each of the five stages is proved and a list of measures for each of the stages of startup development is proposed. The causes of the crisis of the technology startup industry in Ukraine have been identified. The main ways to attract investment to promote startups through venture companies are formulated. Funding for startups has fallen sharply at the moment, but it does exist. At the beginning of 2022, 51% did not receive income, which could lead to the closure of projects and the leakage of new ideas outside Ukraine. In the conditions of modern challenges in Ukraine, the funds are directed to a greater extent to support the economy and the priority needs of the state in terms of each level of government. By regional level, in Ukraine the largest share of startups falls on Kyiv (53.2%), Kharkiv (10.8%) and Lviv (8.2%) regions. Due to the war, some projects have been forcibly closed, at best relocated, and are starting to operate according to new realities. It is established that due to economic and political instability, two other sources of financial resources for the implementation of startups remain unused in Ukraine: bank loans and government support. It is noted that the investment climate in Ukraine has significantly deteriorated as a result of Russia's military aggression and the situation with the development of startups in the country is currently unclear, but the main resources to support and promote innovative projects in Ukraine will remain venture companies.

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Published
2022-04-26
How to Cite
Davydenko, N., & Volkov, A. (2022). THE WAR IN UKRAINE: THE CRISIS OF INNOVATIVE STARTUP. Economy and Society, (38). https://doi.org/10.32782/2524-0072/2022-38-55
Section
FINANCE, BANKING AND INSURANCE