Startup CEOs with teams in Ukraine struggle to help employees

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As Russia continues its military assault on Ukraine, countries around the world are feeling the ripple effects of economic sanctions. But for the startup segment of the US tech industry, the war has felt a bit closer to home.

Ukraine has nearly 200,000 IT workers, according to a report from Stack Overflow, many of whom work for US-based companies. Over 126 startups that raised venture-capital funding in the past year have a primary or secondary office there, according to PitchBook data.

Many of these startups' US-based CEOs are scrambling to ensure that their employees are safe and to provide them with whatever aid they can, three startups told Insider.

For instance, Grammarly, the artificial-intelligence proofreading startup cofounded by three Ukrainian students in 2009 and now valued at $13 billion, will donate all of the net revenue — totaling over $5 million — earned from Russia and Belarus since Russia invaded Crimea in 2014 to causes supporting Ukraine, a representative told Insider.  Now headquartered in San Francisco, Grammarly has been in contact with its Ukrainian employees attempting to ensure their safety. Grammarly will also be ceasing all of its business operations in Russia and Belarus until further notice, the spokesperson said.

Smaller startups are feeling the conflict directly as well. "The haze of it has spread on all team members," said Lasha Antadze, the cofounder and chief operating officer of the nonfungible-token-management startup Rarify. The company is based in New York but has five employees in Kyiv and Kharkiv, according to Antadze. "A week ago, we were together building a better future, and now some of us are fighting for our freedoms with life."

Rarify has offered cash assistance to all of its Ukrainian employees and will attempt to relocate them once the active bombings stop, but it can do little else under such heavy fire, Antadze said.

"Some team members are voluntarily still coding to take off their minds," he said.

Other founders share similar concerns. "Our team went from their day-to-day from being employees at a fast-growing high tech business to having survival conversations,"  said Guy Nirpaz, CEO of the California-based cloud-computing startup Totango. Nirpaz told Insider that he has been in contact with all 15 of his developers in Ukraine since the war began to ensure that they and their families are safe.

Despite Nirpaz's offers to relocate them, the majority of the developers have stayed in the country and are volunteering to aid in the war effort.

"Some of them have tried to volunteer for the military but have not been accepted just yet," said Nirpaz, while others are signing up to support the Red Cross.

"They have that spirit there," said Nirpaz, adding, "We've offered to advance payments and provide loans, and some of them took the offer. Some are worried that the cash is not going to get into their hands, given that the ATMs are pretty much empty now."  

Neither Nirpaz nor Antadze would comment on any financial losses they had suffered due to the war, but Nirpaz did say that some Totango customers were concerned about data security. Nirpaz assured them that their data was safe and was stored in centers outside of Ukraine, but the situation is increasingly stressful.

"Clearly you can imagine how crazy it is where on one hand, you've got to worry about business continuity, and on the other hand, for the livelihoods of your team," Nirpaz said.

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