Amid war, Cornell faculty, staff support Ukrainian startups
By Caitlin Hayes, Cornell Chronicle
In 2014, Charles K. Whitehead ’83, the Myron C. Taylor Alumni Professor of Business Law, was invited to lecture at a premier university in Ukraine – a country that many in the U.S., at that time, might not have been able to locate on a map.
But Whitehead found the country fascinating. As the son of a U.S. diplomat, he had visited Ukraine as a child, when it was part of the Soviet Union, and he returned in 2014 just after protesters had ousted a Russia-backed president and installed a new government.
It was a country in transition, Whitehead said.
“Ukraine was fascinating, a place where the historical dynamics were Russian, Soviet, but the people were looking to the West to develop a new economy, a new platform for business, and a new social infrastructure,” said Whitehead, who specializes in business and finance law at Cornell Law School. “I met Ukrainians all over the country who were clearly entrepreneurial and thoughtful, with new ideas and research, but what they lacked was an understanding of Western business and the ability to position themselves for investors.”
In 2019, after repeated visits to the country, including on a Fulbright grant, Whitehead founded eō Business Incubators with the help of Ukraine-born Felix Litvinsky, managing director of Cornell’s Blackstone LaunchPad, and a grant from the U.S. Agency for International Development’s Competitive Economy Program in Ukraine. With physical locations in Kyiv and Kharkiv and providing support nationwide, the incubator gives Ukrainian startup founders the skills and positioning to attract national and global investment.
Through the COVID-19 pandemic – and now the war – the incubator has supported more than 100 startups, valued collectively at close to $110 million. The teams have brought in approximately $10 million in investment and earn around $1.5 million in annual revenue. And incubator graduates have won every major Ukrainian national competition as well as numerous international contests, taking the $100,000 grand prize at the Dubai 2020 global startup competition and excelling at Web Summit (Portugal) and the Consumer Electronics Show (Las Vegas), two of the world’s largest technology conferences.
Since Russia’s invasion of Ukraine on Feb. 24, 2022, the incubation program has expanded, pivoting back to the online format it used at the height of the pandemic.
“They’re committed,” Litvinsky said about the incubator teams. “Through thick and thin, they’re doing everything possible to grab that value, that knowledge, because they’re looking forward. The soldiers are on the front lines, and our teams are working so that when the war ends, we have a foundation, and we can rebuild.”
Building lasting relationships
The eō – Latin for “to go,” “to prepare,” “to advance” – incubation program typically spans 16 weeks and involves a six-day bootcamp covering the fundamentals of launching a startup, followed by weekly lectures, trainings and meetings with mentors, and a demo day where startups can pitch to each other, and to investors and potential partners. Teams are usually matched with two mentors, experienced entrepreneurs from all over the world – including many from Cornell – who can provide each startup with expertise tailored to their development stage and product.
Dan Matsui, Ukrainian founder of the startup CareTech Human, participated in the incubator last winter, just months before the Russian invasion. He said the program helped him clarify and describe the value of his product – an at-home device that aids in early disease detection.
“There are a lot of specifics: how people like information to be presented, how should we structure timing, how to pitch to present your value correctly,” Matsui said. “In describing our product, we can be super technical but the business presentation – that's been our weak part.”
Matsui said the connections and mentorship have been essential and have provided specialized knowledge and contacts in the U.S., where he hopes to solicit investors and bring his device to market. He also hopes to deepen ties with Cornell; he visited the Ithaca campus in December to meet with Louis Walcer ’74, director of the Center for Life Science Ventures, for consultation on an application to Cornell’s incubator for life sciences startups.
“We’re super grateful to the United States,” Matsui said. “And my connections here are very helpful. From each meeting, we learn more about how to position a product, how to pitch it, where we can mitigate risks, and what areas to pay attention to.”
The relationships built in the incubator are meant to last, Litvinsky said. “We continue to support every single individual who went through eō,” he said. “And we have to give so much credit to the Ukrainians who are looking forward to victory and the opportunities ahead.”
Adapting to war
When the war began, Matsui, with his wife and four-month-old twins, fled Ukraine for Poland, but they returned to Kyiv in May. Aside from pauses due to blackouts, he said his team of about 10 people are working as fast and as hard as ever, while devoting time outside work to volunteer for the war effort.
Litvinsky and Whitehead spent the first days of the war frantically working from the U.S. to ensure their Ukrainian staff and teams were safe, providing information to those fleeing or in shelters and helping to procure medical supplies. Once the invasion slowed, they were able to pivot the incubation program online – they’d already made the transition once for the pandemic – and the cohort they’re working with now is the largest yet, with 32 teams initially enrolled.
Some things in the program have changed; frequent blackouts and air raids have required flexibility from the once-strict attendance policy. In online sessions, one participant keeps an AK-47 on hand in case of attack; others sometimes log in from dark rooms as they wait for electricity to be restored. Still more have left Ukraine and are logging in from different time zones. Whitehead visited Kyiv in October, when a Russian cruise missile struck just 300 meters from his hotel, and again in December during Russia's then-largest missile attack since the start of the war.
Despite the dangers and complexities, the program’s success and flexible format have made it attractive to other countries as well. “For the same reason we’re able to pivot because of the war, we can also fairly easily move into other areas,” Whitehead said. “In Ukraine, eō's success has shown others in the region who might think about a startup economy, and also global investors, that building this kind of ecosystem makes sense.”
Whitehead and Litvinsky have begun a program in Moldova, another nonNATO country bordering Ukraine, and have been approached by contacts in Georgia and Poland.
Back home, Whitehead used his experience developing the incubator to help design the Law, Technology, and Entrepreneurship program at Cornell Tech in 2019. In 2020, he was selected by Ukraine’s Minister of Finance to serve on the supervisory board of a new national Ukrainian Startup Fund, which provides small grants to tech startups. He has also lectured across Ukraine, as well as worked with Ukrainian government officials to assist in setting up new financial and business platforms.
“Rarely do you get a chance to put into practice the things you research and lecture about,” Whitehead said. “Our work in Ukraine has given me that opportunity.”
Plans are also in the works for eō Business Incubators to launch a venture capital fund devoted to Ukraine even before the war comes to an end.
The incubation program may have even more impact in Ukraine in the years to come, Whitehead said. “It teaches a way to think differently, to build business, to connect outside of Ukraine. These were all good things before the war,” he said. “In post-war Ukraine, this will go from being valuable to becoming fundamental.”