Against Ukraine's tech industry, Putin has already won

Wreckage from a Russian missile strike in Kyiv  credit:  Valentyn Ogirenko, Reuters
Wreckage from a Russian missile strike in Kyiv credit: Valentyn Ogirenko, Reuters

Israeli companies have been trying to help their Ukrainian employees, but they are starting to think about development centers elsewhere.

For a month now, Israeli technology companies have been enabling their employees in Ukraine to relocate in the west of the country or across the border in Poland, Romania and Bulgaria. The response among the Ukrainians has, however, been meagre. Companies that did not actively book flight tickets and hotel rooms for their workers - as Wix did for a thousand of its employees - mainly encountered indifference. An Israeli manager in one of the largest employers in Ukraine admitted, on condition of anonymity, that not more than 10% of its employees had voluntarily evacuated before the Russian invasion that began yesterday.

Now, many of the workers who chose to remain in the large technology centers - Kyiv, Kharkov, Dnipro, and Odessa - have found themselves spending most of their day in queues for the supermarket or the bank ATM, or in traffic jams on the way out of the city and on the westbound lanes of the highways. Some of this complacency arose from optimistic assessments of the intentions of Russian president Valdimir Putin, which were common to most Ukrainians.

"It's hard to get into the mind of a madman"

Eddie Prilepsky, who owns a large college in Kyiv for technology professions, many of the graduates of which now work directly or indirectly for Israeli companies, explains that in the past few days he sent messages of hope to his thousand employees, but these had proved unfounded.

"I called on them not to panic, because a military attack was bereft of logic. In the end, I was proved wrong - it's hard to get into the mind of a madman," he admits. "Until yesterday, we all sat in cafés, and at the weekend you couldn’t book a table at restaurants in Kyiv. Today, the situation has changed 180 degrees. You see the bombardments and hear about the tanks, and immediately think about hoarding food and fleeing. There are traffic jams at the exits from the cities and queues everywhere. Now, the talk is of a rapid takeover of Kyiv by Russia, within days."

Two weeks ago, Alon Cohen-Naznin, COO of the Plus500 group, presented the company's 40 Ukrainian employees who work in back office and customer service jobs, a plan for evacuating them to Bulgaria. The plan included financing air and train fares and booking hotel rooms in Sofia. "The employees were very appreciative of the plan, but were fearful of evacuation," he says. "Some of them refused to leave as long as there was uncertainty about what would happen and how long it would go on for."

This morning, Cohen-Naznin received a terrified phone call from the team's manager. "She told of bombings and gunfire - these are experiences they have never been through. At that moment we decided that we were activating the plan."

Today, however, after a state of emergency has already been declared by the Ukrainian government and the Russian invasion is a fact on the ground, crossing a border is a harder challenge: the country's skies are closed, ruling out any possibility of flying over it; the lines at the border are growing; and the new draft rules now in effect oblige any man aged 18 to 60 who is not exempt from military service to join the army.

The draft rules wrecked Plus500's plan to organize a fleet of buses for the evacuation today: the transport company informed it that the drivers had been drafted, and finding another bus company was all but impossible. Those of the employees who were of draft age could have crossed the border until a few days ago, but now they have to report for military duty.

Cohen-Naznin reports a line of 1.2 million people at the border crossing into Romania, the closing of the border with Moldavia - which is the shortest way to Bulgaria - and so they have no choice but to use the Polish border, which has many crossings.

Ofer Karp, EVP Engineering at WalkMe, who remotely manages forty employees in Kyiv, admits that only a few of the employees fled Ukraine, and a few more moved to the west of the country. "They thought that the fighting wouldn't reach Kyiv, at least not initially, but most of them still feel safe in the city," he says. As part of the effort to allow the employees time to organize food or move to the west, Israeli workers are taking on the jobs of their colleagues in Ukraine. "We tell them, take as much time as you need, we'll back you up."

Death blow to Ukraine's image

Development managers are providing immediate solutions for their workers and helping them in any way they can. Companies like Playtika, Sisense, Valent, Bizzabo and the Aman group have helped employees move to the west of Ukraine or outside the country, to places such as Poland, Romania and Bulgaria. Some of them even provided their employees with aid packages, averaging about $1,000, to help them and their families rent temporary accommodation and maintain themselves in this period.

Nevertheless, more and more managers are asking themselves what Ukraine will look like after the current crisis. How long will it go on, and will the country continue to grow as in the past? Several development companies had to leave the Crimea when the Russians moved in in 2014, and some of them have been feeling the crisis for eight years, and it is only worsening.

"If a month ago, development managers weren't prepared to hear of development centers outside Ukraine, now some of them are starting to think about long-term alternatives," says a veteran development manager in Ukraine who manages thousands of workers there. "As a plan for diversification, many of them are looking at Poland, India and Bulgaria as excellent alternatives."

In this sense, Putin has already won: the best Ukrainian engineers are looking for temporary relocation possibilities that could become permanent. Bulgaria, for example, has spotted the potential of Ukrainian technology workers migrating to it. It is taking a proactive approach and shortening visa queues for them, and has excellent ties with the big technology employers in Ukraine. "They are thinking long term," the manager says. "They envisage Ukrainians who have relocated to Sofia building a new technology industry there."

Sanctions affecting tech companies

"The sanctions imposed only two days ago by the Americans don't allow us to employ people from Donetsk," says an Israeli manager of the region that Russia has declared is part of its territory. "It doesn't happen in large numbers any more, since many people from Donetsk now live in Kyiv, and have a liberal Ukrainian identity in every respect. We have seen cases of Ukrainian technology workers choosing against the current to return to Donetsk, and as a western company we cannot employ these people."

Published by Globes, Israel business news - - on February 24, 2022.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.

Wreckage from a Russian missile strike in Kyiv  credit:  Valentyn Ogirenko, Reuters
Wreckage from a Russian missile strike in Kyiv credit: Valentyn Ogirenko, Reuters
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