Tech Firm Ciklum Attracts Investment from Dragon Capital, AVentures Capital

Tech firm Ciklum announced on Feb. 4 it had sold minority stakes to two Ukrainian investment companies — Dragon Capital and AVentures Capital.

The companies would not disclose the value of the transaction, and as they are private they can opt to keep this information to themselves. But according to Ciklum CEO Michael Boustridge, the money will be spent on “propelling Ciklum’s rapid growth in delivering cutting edge technologies to clients around the globe.”

Executives from both investment firms said they were pleased with the investment. Dragon Capital Managing Director Andriy Nosok, for example, called Ciklum one of the leading companies in the tech sphere in Ukraine.

“We believe that the ongoing global digital transformation will support increasing demand for IT solutions and services, and that Ciklum is very well positioned to capitalize on this sustainable trend,” Nosok said in a statement from his company on Feb. 4. Dragon Capital is the largest investment company in Ukraine.

Andrey Kolodyuk, a managing partner at AVentures Capital, in turn, told the Kyiv Post it was “a natural decision,” as he had known the company since it was founded in 2002 in Kyiv, and had been on its board of directors for the last three years. Kolodyuk also said that the company has the potential to grow even faster if it ramps up its mergers and acquisitions activity — buying smaller companies with expertise in a particular field in IT.

Although Ciklum is considered an international company with 12 offices worldwide, it is headquartered in Kyiv. Hence, most of its activities take place in Ukraine, where it employs over 3,000 people: developers, designers, product managers and data scientists.

Ciklum sells software development services abroad — traditionally this is called outsourcing. And in this field, the company ranks among the best 100 in the world, according to he 2018 Global Outsourcing-100 ranking.

In 2015, the company made to the headlines of international media, when U.S. billionaire philanthropist George Soros acquired an undisclosed stake in Ciklum from Danish founder Torben Majgaard and private equity fund Horizon Capital.

The tech firm was founded by Majgaard, who came to Ukraine in 1998 to resell second-hand computers, but ended up managing one of the nation’s five largest IT outsourcing companies. Majgaard was steering the company until his death at the beginning of 2019. The executive suffered from alcoholism and died on Jan. 3 in a hospital in Marbella, Spain, at the age of 48 from cirrhosis of the liver.

Source: KyivPost