Your Own Software Development Center in Ukraine
#1 way to expand from 0 to 100 engineers in a year in Ukraine. With Alcor, you’ll get:
- Silicon Valley-caliber team of 20+ senior developers in 3 months
- Up to 40% savings compared to traditional outsourcers
- Employer of Record service โ no need to set up your legal entity
- Payroll, benefits, taxes, and other operational support
- 100% legal compliance
- Zero buy-out cost
Alcor is Disrupting the Traditional Offshoring Models
Software Development Center in Ukraine is about
Silicon Valley-Caliber Talent
Hire top 10% of local software developersZero Launch Cost & Risk
No setup fees, no legal entity needed, liability shieldFull Integration
Your team, your culture, your practicesZero Buyout Cost
Insource your team to your entity at no cost at any timeSame budget, better talent
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Outsourcing company
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Alcor
- $ 70,000
- $ 60,000
- $ 50,000
- $ 40,000
- $ 30,000
- $ 20,000
- $ 10,000
- 0
Same talent, 40% savings
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Outsourcing company
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Alcor
- $ 70,000
- $ 60,000
- $ 50,000
- $ 40,000
- $ 30,000
- $ 20,000
- $ 10,000
- 0
- IT Professional compensation
- Recruiting cost
- Providerโs uplift
Key things about software development center in Ukraine
What is software development center
A software development center is your R&D office abroad, built from scratch by Alcor to let you focus on product development and equipped with skilled software engineers at lower costs โ an ideal solution for both large tech companies and startups.
Alcorโs unique solution enables you to establish your own software development center in Latin America and Eastern Europe with a team of Silicon Valley-caliber software engineers. The best part? You donโt need to worry about establishing a legal entity in these regions โ Alcor takes care of everything for you. From full-cycle tech recruitment to comprehensive EoR support and other back-office services, all offered with flexible a la carte pricing, we make it seamless and straightforward. Plus, there are no buy-out fees or markups โ your development team is yours from day one, and you can save 20%-40% compared to traditional IT outsourcing or outstaffing. Isnโt that revolutionary?
Advantages of setting up your software development center
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Access to a wider pool of tech talentย ย ย
The latest ManpowerGroup research reports that around 70% of tech leaders in the US face difficulties filling roles. With such a severe talent scarcity, Western tech companies are turning to different regions to hire skilled tech talent and launch their software development centers. This opens doors to millions of candidates with diverse skills and tech stacks. For example, Latin American and Eastern European regions boast over 2.5 million tech specialists who demonstrate Silicon Valley-level expertise in Java, C++, PHP, Python, JavaScript, Swift, .NET/.NET Core, and other programming languages. Additionally, they are well-versed in database development, mobile development, cloud computing, and data analytics.ย
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Opportunity to slash costsย
Hiring a development team abroad not only unlocks a treasure trove of skilled talent but also lets you enjoy the benefits of more affordable salary rates. For example, senior software developers in Latin America earn about $55,000 per year, while those in Eastern Europe make around $68,000 annually. By comparison, their counterparts in the US charge approximately $117,000 for similar services. On top of that, setting up development centers in these regions means benefiting from business-friendly tax rates and a welcoming environment for growth.ย ย
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Scaling abroadย
Setting up your software development center in a foreign country allows you to tap into new markets and build global partnerships while scaling your operations efficiently. Many Western tech companies have already leveraged this strategy to achieve significant growth. For example, Sift expanded its team with 30 talented software engineers in Eastern Europe within just a year and later achieved unicorn status after raising $50 million in funding from Insight Partners. Other success stories include Ledger, Dotmatics, Grammarly, and the list doesnโt stop there!ย
Why Ukraine is a top destination to start a software development center
- 363,000 tech gems, 2nd largest talent pool in Eastern Europe, which grows with 25,000 STEM graduates annually.
- the average annual salary of a Ukrainian developer constitutes $53,000, which is 59% less than that of an American engineer.
- #1 in Europe for tech skills, with programmers excelling at JavaScript, Java, Python, C#, TypeScript, PHP, and Kotlin.
- top 10 in the region for innovation development and startup ecosystem.
Are there any challenges or risks?
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Legal aspectsย ย
One of the main challenges in setting up your software development center abroad is understanding the local legislation and ensuring full compliance. On the one hand, you can tackle it all yourself, starting from scratch. In this case, prepare for a marathon of paperwork and months โpossibly years of setup, all while learning the ropes and dodging costly pitfalls in the local market. In addition, overlooking critical legal requirements or missing deadlines could result in hefty penalties, fines, or even the risk of legal actions that could severely impact your business operations and reputation. On the other hand, you can skip the red tape and partner with a reliable local vendor. They handle all the legal nuances and setup, letting you jump straight into building your team without the bureaucratic headaches.ย
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Quality of hiringย
Hiring software engineers in an unfamiliar market is no walk in the park. It demands in-depth research into the local labor scene, crafting a smart tech recruitment strategy, and navigating the interviewing process. On top of that, finding that perfect candidate who not only fits your technical needs but also blends seamlessly with your company culture adds an extra layer of complexity. To save time and money while establishing a software development center, tech companies choose to partner with experienced recruitment providers. Typically, these providers offer clear guarantees, such as a 2- to 6-week timeline to fill the vacancy, a specific number of CVs required to secure a job offer, and a large recruitment team with around 40 headhunters on board.ย
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Provider choiceย ย
Yes, choosing a reliable partner abroad is another pitfall tech companies face when opting for software development center services. Your scaling experience can quickly go south if your provider makes mistakes โ like presenting unsuitable candidates, missing deadlines, mismanaging payroll & taxes, or failing to deliver other operational services, which could force you to juggle multiple vendors. Instead, look for a partner who is not only dependable and trustworthy but also brings top-notch tech recruitment and legal expertise to the table.ย ย
Alcor is an excellent example of such a software development center service provider, having successfully assisted prominent tech companies like ThredUp, People.ai, Gotransverse, and others to set up their software development centers abroad. Our clients have praised our services, with one among others stating on Clutch: โAlcorโs expertise and implementations have enabled us to run our company in the way and at the level we want.โ This is thanks to our unique solution, which combines tech recruitment with seamless EoR support, allowing our clients to operate their businesses abroad hassle-free.ย
Signs a business is ready to expand with a software development center
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You want to scaleย ย
Building a software development center is a game-changing opportunity for established tech companies looking to scale and explore new markets. With resources often constrained in a single location, scaling can be a challenge. Thatโs why leading global tech firms like Ledger, People.ai, and Sift have turned to us to build their development centers abroad. Result? Theyโve turbocharged their tech delivery while also growing big in the foreign market.ย
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You aim to save costsย
Running software development activities can be pricey for American tech companies, as setting up a software development center with an engineering team in the USA often costs from hundreds of thousands to millions of dollars. But if youโre looking to cut operational costs, starting a software development center abroad is a smart move. For instance, Latin America and Eastern Europe offer some of the best price-to-quality ratios for this purpose, with developer salaries there being 2 to 4 times lower than in the US. Not only will you benefit from lower labor costs, but youโll also save on technical equipment, office lease, and maintenance, thanks to generally lower prices and rental fees. With these savings, you can reinvest in your business according to your current needs.ย
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You intend to focus on your productย ย
Tech companies are drawn to the software development center solution because it enables them to focus on what truly counts โ advancing their core product. Imagine: while a professional service provider takes care of tech recruitment, EoR activities, and other operational support, you manage your offshore team and drive your companyโs growth. Itโs a great way to cut stress and boost productivity!ย
How to set up a software development center in Ukraine
With Alcor, youโll avoid drowning in paperwork and back-office tasks when launching your software development center. Weโve got it all covered, and our software development center as a service process runs like clockwork:ย ย
- We kick things off with full-cycle tech recruitment in your chosen location. Our team of 40 seasoned headhunters can find Valley-grade software engineers in just 2-6 weeks!ย
- Accounting and HR payroll are crucial for smoothly running your new software center. And thatโs where our EoR service takes care of everything โ from managing salary payments and transferring funds between your R&D unit and headquarters to handling health insurance and leave policies. Plus, we offer comprehensive legal and compliance support, including real estate negotiations, contract drafting (SLAs, NDAs, B2B agreements), and support with labor laws, visas, and M&A.ย
- At the same time, if you need your own physical office, our real estate experts are on the hunt for the perfect space for you. We handle everything from location selection and parking to security systems, office layout, seating, and equipment.ย
- To complete your software development center setup, weโll assist in choosing furniture and establishing a robust IT infrastructure โ everything from computers and software to security systems and servers.ย ย
When all is said and done, your turnkey software development center is up and running within just 2-3 months!ย ย
Mistakes in building a software development center
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Working with multiple service providers in parallelย
Some companies opt for outsourcing the software development center setup to multiple service providers for different tasks: tech recruitment, employer of record, legal compliance, office lease, procurements, and so on. While this might seem efficient, this approach often backfires, leading to miscoordination, delays, and, ultimately, higher costs and disappointing results.ย ย
Solution? Consider teaming up with a local software development center provider that can manage all back-office functions that you need in one place, ensuring your development center runs smoothly and saving a lot of your time and costs.ย
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Overlooking employer brandingย
When business leaders overlook promoting their company in a new job market, they often find themselves facing rejected offers from prime candidates. In fact, 60% of job seekers decide against accepting a position due to a company’s poor employer brand. This typically occurs when candidates are unfamiliar with the companyโs values, culture, and growth opportunities, leading them to choose other options instead.ย
To turn this around and boost your tech recruitment, Alcos kicks off an engaging employer branding campaign by crafting a compelling employee value proposition (EVP), building your company’s strong presence in local developer communities and tech media, and running impactful social media and PR campaigns. For example, we created a video featuring Sift’s Hiring Manager that highlighted the companyโs values and team culture. Promoted across social media, the video had a significant impact โ leading to a 15% increase in response and offer acceptance rates.ย
Software development center is an all-in-one place for tech product companies
Employer of Record
- Onboarding / offboarding according to local legislation
- Monthly payroll & accounting
- Remitting remuneration
- Benefits management (if needed)
- 24/7 support by Dedicated Account Managers
- In-house legal experts
Back-Office Support
- Single point of contact for all operations
- Background checks
- Benefits management
- Laptops & hardware procurement
- Office rent
- Any other type of back-office support
IT Outsourcing vs Software R&D Center
IT Outsourcing
- Cloudy pricing Gear up to pay way more than you initially expected: providers will only let you in on the total costs in the end.
- Frequent team changes Skilled software engineers are allocated between other projects, so you never know if your A-players will be snatched away.
- No place for your culture & employer branding Your offshore developers work under the brand of your outsourcing provider at their premises, where no room for your corporate culture and policies is left.
- Shared intellectual property You share your IP with developers that come and go to other projects because of the IP rights agreement with the provider. As a result, the source code is never between you & team only.
- Not investment material Itโs tough to get investors onboard when outsourcing your core competencies and not owning the code. Sounds untrustworthy, doesnโt it?
Software R&D Center
- Maximized savings Time to unfreeze hiring: your own development team plus office results 2-3 times cheaper. How does that work? You hire and get neither buy-out fees, nor unexpected markups.
- Simplified recruiting Who wouldnโt want to be involved in actually creating a product, rather than writing the code here and there? Product creation and the feeling of ownership draw developers like moths to a flame.
- Own branded office & rules You get your own physical office for ideation, innovation, and growth โ everything to manage your team independently and help you scale.
- Intellectual property under control With direct agreements, you fully own your product and its source code, keeping unique expertise in-house.
- Easy investment attraction Establishing your own R&D center with a dedicated team will enhance your appeal to investors.
FAQ
1) What services does a software development center in Ukraineย include?
If building a software development center with Alcor in Ukraine, youโll enjoy our all-in-one solution. First, we handle tech recruitment from start to finishโcrafting the ideal candidate profile and EVP, sourcing and pre-screening candidates, conducting HR interviews, and working with offers/counteroffers. Next, we take care of all the EoR essentials: compliant developer employment, monthly payroll, accounting, legal issues, and benefits. Plus, we offer additional support like office leasing, hardware procurement, and visa management to keep your offshore software development center running like clockwork.
2) How fast can you set up a software development center in Ukraine?
We can establish a fully equipped software R&D office in Ukraine within 2 months. The time it takes to hire IT specialists depends on the specific roles and numbers you need. However, we guarantee senior software developers will be hired within 2-6 weeks. As your reliable R&D service provider, we provide comprehensive support through our Employer of Record, employer branding, and turnkey services to ensure your offshore team operates seamlessly.
3) Can you hire C-level management in Ukraineย for a software development center?
Yes, our team of 40 tech recruiters possesses hands-on experience in headhunting lead and C-level specialists in the tech field. On average, it takes us 2-6 weeks to headhunt an IT manager who perfectly matches our clientโs needs and requirements.
4) Is Ukraineย the best country to build a software development center in?
Ukraine is a viable option for setting up your software development center. This offshoring location offers the most budget-friendly annual salaries for programmers in Eastern Europe, averaging around $53,000, which is $8,000 less than in neighboring Poland. Plus, with the 2nd largest talent pool in the region and developers ranked #1 for tech skills in Europe, Ukraine is your go-to for top-notch talent in JavaScript, Java, Python, C#, TypeScript, or PHP.
5) What do I need to start a software development center in Ukraineย with Alcor?
First, choose the IT hub where you want to set up your software development center. Next, define the type and number of developers you need for your software product. The Alcor team can prepare availability and salary reports for you to have a better understanding of the local market. Then you should decide if you require a physical office and additional operational support. If so, Alcor can easily cover all those for your software development center to run smoothly. If you donโt have a legal entity abroad, no worriesโAlcorโs Employer of Record handles compliant onboarding and offboarding of your developers as well as payroll, accounting, and benefits management.