Big interview: Devlight founders on IT business challenges and opportunities during the Ukraine war
Thanks to Vector media for interviewing us.
We at Vector had the pleasure talked to Ihor Polych and Liubomyr Miller, Devlight founders, about the war in Ukraine, how Devlight’s business looks now and how to work with companies that are 100 times bigger than you.
Ihor, do you recall your first reactions in the first days of the war? Were you prepared for what was about to happen?
Without a doubt, wars are terrible.
Here at Devlight, we started to prepare for the war since mid-January, when it became clear that the Russian tanks, amassed on the other side of the Ukrainian border, were not going to go back to their permanent bases. I had anticipated that a full-scale war would happen, but naturally I believed in a better course of events. That was the time when we made the decision not to initiate any investment nor development projects before March 2022 and limit ourselves only to mandatory expenses while accumulating cash.
At the company level, we developed three scenarios of how the events could unfold and carefully followed the indicators to better understand our daily reality.
The worst-case scenario envisaged a full-scale invasion that would bring about a complete collapse of our financial system and the economy in general, the closure of borders, and a massive chaos in the country.
According to the best scenario, we hoped that the international efforts of our Western partners would be efficient, and we would return to searching for diplomatic solutions of the problems that Ukraine had been faced with.
The basic scenario meant that Ukraine enters a turbulent economy and investment crisis caused by the information and hybrid war perpetuated by russia. A lot of analysts agreed that russia’s goal was to deplete Ukraine’s potential on the information and economy fronts, to scare away Western investors, and to create preconditions for a dramatic aggravation of the situation in our country. As early as at the beginning of February a number of our clients informed us that due to these circumstances, they were terminating active investments into the projects; some clients that we had been preparing large contracts with simply were turning us down, their explanation being that the war was about to start. After February 20, we were getting ready to sign two contracts for the development of mobile applications with large retailers who despite the situation were ready to initiate some projects worth a few hundreds of thousands of dollars each.
On February 24 at 05.54 am I sent a message to our team chat with the information that the war had started and provided the guidelines on what we were supposed to do next. The main priority was to evacuate our colleagues from territories that could quickly become occupied, and to ensure the overall safety for the business.
We were capable to return to work as a whole team only on March 10, after almost all our colleagues were safe, had stable Internet connection and the possibility to carry on with their work.
What does your business look like now?
Throughout the year 2021 our whole team put a lot of effort into strengthening our business after the challenges of the preceding COVID year. We completed a huge personal home assignment, which allowed us to accumulate reserves, ensure proper arrangements with our clients, and be prepared for various scenarios. Thanks to a series of well-aimed decisions that had been made before the war and during its first days we did not sack a single employee, did not sustain more losses than we estimated we would under the circumstances, and did not lose a single key client.
At the beginning of May we returned to the pre-war income levels, and currently (as we are speaking) our MRR is 2.2 times higher in comparison with January this year. I believe we’ll see the end of the year with a2.5-fold growth compared to the previous year, exceeding our pre-war projections.
Has cooperation with the clients changed? How has the geography of your clients changed?
As I mentioned before, we haven’t lost a single key client, while considerably upscaling our cooperation with some large clients. After February 24 we managed to sign a number of important agreements, essentially all-important agreements that we had been counting on. I can’t say that the process of cooperation has changed in some considerable way, no. Our clients understand the situation and the context that we are in and accommodate for this. Interestingly enough, our colleagues have greatly increased their productivity as the reaction to the war, improving the overall performance of the company.
When it comes to the geography of the clients, in our case it hasn’t changed. At the start of the war a lot of companies from our sector were massively and hastily changing their places of official registration to the EU ones, removing any mentions that their headquarters were located in Ukraine before, to make sure that they could continue attracting clients from abroad. We made a conscious decision not to follow such steps as we have always been and remain a Ukrainian company.
About problems in the Ukrainian IT sector
Has the Ukrainian IT sector slowed down this year? The answer is no. The Ukrainian IT industry continues to grow steadily. In the nine months of 2022, the volume of computer services increased by 13% despite the War and related risks and amounted to 5.5 billion US dollars.
The Ukrainian technological sector continues to hold the economic front of the country, companies timely and continuously fulfill contracts and projects, attract investments and new customers, actively enter the global market.
The reason of the above is that today the world is reacting differently to what is happening in Ukraine; a lot of companies are still ready to take the risks and choose a Ukrainian software developer, well aware of the high-quality output that they will receive. Ukrainian IT companies have demonstrated incredible resilience and overall perseverance, which allows to boost the optimistic expectations.
What is your adaptation plan? How do you plan to attract international clients?
I can’t say that we have some strong adaptation plan. Here at Devlight we constantly interact with international clients, both the existing ones and those who only consider working with us. To ensure our client’s safety we develop Continuous Business Plans for every project and constantly update them based on the situation at the front and in our business in particular. We jointly model possible scenarios to keep an eye on the possible considerable changes and their potential impact. This really helps our clients to boost their confidence.
When it comes to the plan of attracting international clients, there are no changes there — we keep achieving the planned outcomes ensured by our marketing and sales teams. As I said above, the situation in Ukraine is being assessed differently now. We see that a lot of company clients are purposely entering Ukraine now in search of engineering teams exactly in order to support our country. And this is a very positive development.
Has the company vision changed due to the war? What are the company goals now?
The answer is both yes and no.
Although we are happy with our results and with how we’re doing, looking at the market analysis over the past six month we understand that we can’t rely on the income solely from the outsourcing business. We need additional models that do not depend on the core business. In 2021 together with the partner we set the goal of developing a new business line where we would create and develop our own digital products in our areas of interest. The war has accelerated the development of these plans, and now we’re actively involved into this line; we’re looking at the opportunities and are getting ready for the first experiment.
As for the goals, we aim at developing a stable and profitable business. In late 2021 we had set an ambitious goal of a two-fold (double) growth, and we will succeed. As for the goals for the next year, I’m not ready to discuss them because there are dynamic changes taking place every week. What remains unchanged is our commitment to providing top quality services to our clients. Please do not take this as bragging, but we are good at it.
About the clients. Who are your working for now and what products are you developing?
Our clients belong to those companies that really want to receive a successful outcome of collaboration, are ready to work in our processes system, and understand the value of such partnership. There are no two identical projects in the company. We are approached by both startups that have just received investments, and large companies that strive for the excellence of their digital products and are looking for the ways to achieve a new maturity level.
In our turn, we’re interested in working with challenging products whose complexity reveals itself at the ecosystem level. Our team can truly demonstrate our approach and the Devlight’s experience accumulated over the years. For every individual client we select respective approaches and processes, guided by their goals, the technological maturity level, and the client’s team. Thanks to this the client receives the level of service they expect, and we achieve successful results of cooperation.
Currently, we are working with large banks, all-retailers, loyalty programs and crypto projects. There are several national and global industry leaders among our clients. On average, our clients have over 10,000 staff, whereas the active user base for the mobile app that we are developing is 1.2 million users who monthly interact with the product.
Why do clients choose Devlight?
I think the reason is our client-centered approach and our huge experience in developing large-scale mobile projects.
In May, we reached the milestone of 35 million downloads of our apps. This is a fantastic result for us, and I couldn’t have thought before that we would achieve it. In fact, every Ukrainian citizen has interacted with the apps developed by Devlight.
On the other hand, this figure represents an incredible opportunity for data analysis and studying the analytics of user experience on the large scale. Through the prism of this analytics, we can look at many solutions that we offer from a different perspective, and this is the very factor that helps us to multiply our experience time after time. More than 10 of our clients belong to the largest Ukrainian companies that made it to the Forbes top 100 in 2021.
Please don’t take this as an exaggeration, but we are truly committed to our cause, and we love what we do. The company has a quite simple philosophy that a smartphone is a device that people interact with the most during the day. Therefore, we simply can’t afford to create a poor-quality user experience, select bad technological solutions, or just develop some functionality that nobody needs. The end user needs to get an efficient solution of their problems in such a way that they want to go back to the product again and again.
Sometimes we would have a client whose ideas are not fit for the market or whose solution would not find an end user, and we clearly communicate this to the client and show them the methods and the tools for validating the idea or testing the concept. If the client does not hear us, we do not continue cooperation. In fact, we refuse much more often than we get refused. A great achievement is that the whole team shares this philosophy, and we came up with the rule to make the necessary decisions, not the simple ones. This system of values truly motivates us, so we constantly raise the requirements to us and to our product. In its turn, this helps us to win new clients with cool ideas, and then the cycle repeats itself. It’s really simple.
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How does a small company manage to work with companies that are 100 times bigger?
I don’t think there is some secret formula here.
We really know our clients, their needs, their typical painful areas and challenges that they are faced with, as well as their expected results. This helps us to be always aligned with the client and interact with them in order to develop the best possible product. The companies that come to us clearly see our expertise level; they realize that we want to create something valuable and useful, just like them, so that’s why they select us.
The company, in its turn, continues to stick to the client-centered approach. Thanks to this we see the opportunity to create a high added value in our highly competitive market, where ensuring and sustaining a competitive advantage in the long run is extremely difficult.
How are we going to do this? We want to be so useful for our client that they always want to stay with us. And I’m talking not only about developing the app, but about the whole journey of further developing this product.
How do we achieve that?
Only with a highly professional team. And we are constantly looking for such methods to make sure that all our colleagues, both those who interact with the clients and those who develop the software, are part of this process, with sincere and ongoing commitment. This boils down to the company culture and its values.
Switching to Liubomyr Miller — Delivery Director at Devlight.
Liubomyr, is it difficult for an engineer to become part of your team?
I will start from saying that a ‘team’ is a sacred word for us, because the teams that are formed here stick together like glue and bring about a synergy effect. When it comes to quality standards, here at Devlight we are committed to ensuring the high quality of products, methods, and processes. All these things make up the ‘value book’ that each developer needs to go through and learn to share with us. As for becoming part of our team, after working in the mobile application business and interacting with a large number of clients and domain areas for a long time, we have developed a set of key requirements/skills that we expect from a potential candidate.
The first and the key requirement is the technical background of the candidate. This is the foundation upon which we’re going to build the professional stock of knowledge in our company after a successful interview.
The second skill is the speed of thinking, that is the way the person thinks and generates decisions in their mind, together with the ability to express them. This skill is extremely important for us, because the decisive factor is a timely prevention or mitigation of a problem, just like in any successful business. Based on our experience I can say that after the first meeting with the HR there is a 70% probability of predicting whether the candidate would pass the technical interview.
The third optional skill is proactivity. Depending on how proactive a person is, we fit additional roles in our projects. More proactive people usually become team leaders of mobile teams with opportunities to further develop their career and open up their potential not only as a developer but also as a person who would make final decisions in the team.
What are the quality standards and the recruitment process at Devlight?
Based on many years of working with different people, we identified a number of key standards that help us to see a potential candidate’s knowledge and skills directly during the interview.
The first standard is the experience of working with the up-to-date technical stack on the Android or iOS platform. The knowledge of the fundamentals is mandatory. Then follows a list of mandatory knowledge items according to our level. This standard is the primary one, and it helps to understand whether the person would be able to work with us.
The second standard is the knowledge of English.
The third standard is the ability to express their ideas so that a ‘model client’ could understand a problem and its suggested solution.
Overall, the interview has 5 components and takes 2 hours:
Stage 1 of the interview: these are general questions in order to set the right tone for the interview and to get to know the person better. Some sample questions for this stage are: “Where did you study?”, “How did you get into the IT?”, “Why Android/iOS?”, “Is there anything in the work you’ve done that you are proud of?”
Stage 2 of the interview is a practical live coding session. This means that our interviewer sends 2 practical tasks and asks the candidate to launch a working environment in which they will complete practical tasks. Then the candidate is asked to share their screen so that our interviewer could follow the process of completing the tasks. While performing the practical tasks we recommend our candidates to talk through the tasks and to tell us how they would address them. This helps us to see how the person thinks and how well approaches to the solutions. At this stage we can help the candidate, but only if we see that they are moving in the right direction and get stuck only on some non-critical aspects.
If the candidate fails this stage of the interview, it makes no point to move to the following stages, so we say goodbye. The interview ends with written feedback highlighting the areas for improvement.
Stage 3 of the interview is a theoretical session. After the candidate passes the practical session, we start discussing some theoretical questions. Overall, during this stage of the session we get to know what technological stack the candidate worked with and how well they know it and are able to use it. Based on this stage of the session we realize if we can give them an offer, and if yes, which project that can work on so that they could show their full potential and also start growing.
Stage 4 of the interview is an interactive game in English “I’m the client, you’re the developer”, where I as a client need to express the idea of “what improvements can be made to the app interface so that it becomes more convenient”, and we provide the respective case. This stage of the interview helps us to see two things: Number one is how well the person communicates in English, and number two is how they can behave when talking with the clients if the person needs to defend this or that technical decision and explain why it is the correct one.
Stage 5 of the interview: the questions from the candidate that we answer.
What is the company’s culture? What is it that you strive for?
Based on what was mentioned above, the things that we try to develop in the company and commit to them bring about the ‘culture of quality’. This culture was born back in the days when out company was founded, and it still encompasses all our employees. The culture of quality manifests itself first and foremost in the quality of the developers that we cater to through various challenges, interesting and non-trivial tasks, a strict approach to the tasks etc. On the other hand, the culture of quality is found in the conditions that we create for the employee. It goes without saying that a person opens up their full potential when they are placed in the right environment. Part of such environment is the team that this person will be working with, as I mentioned above, and also the team’s shared commitment to the joint goal and the values they are working on, which helps to deliver excellent practical results.
When it comes to aspirations, they are quite simple, but connected with work. All the things I described above work in synergy and boost each other. The people who join us have the opportunity to fully develop their potential thanks to the tools and practices that we provide, which is the derivative of the company’s culture that we have been developing over the years for our clients and partners.
Backing to Ihor
What have the greatest achievements and the biggest mistakes been over the past 6 years of managing the company?
Since its creation more than six years ago the company has gone through various stages of evolution. The majority of these stages, including the period of growth that we are going through now, have been very good, but there were also some periods that I wouldn’t want to live through again. But all that enriched our experience.
We founded Devlight as a true startup in a cheap office center soon after graduation, entering the market as real underdogs. We have never had an investor or any venture capital, but it never stopped us from pursuing our goals. Even during the most challenging times, like the pandemic year 2020, we remained optimistic, didn’t give up, and used our will to carry on working with whatever we had at hand. Having successfully passed a truly difficult stress test after the start of the full-fledged war, I’m optimistic about our future and I realize that we can really achieve everything that we want. I get the greatest confidence from our team, from the wonderful professionals who work every day on improving our client’s products.
Devlight’s biggest achievement is its team and the team spirit that we enjoy. Our teams are fully autonomous and prepare the agenda for developing the products themselves. Project managers closely collaborate with the client’s teams, advising them on the best practices and the necessary solutions. As for me, this is the main formula for a successful business, I mean the right people at the right places, who know how to do their job better than you. Currently I perform only intermediate control, and I keep finding proofs that the statement above is true.
As for mistakes, there are a lot of them, and sometimes it seems there are more than needed.
Looking at the retrospect, I understand that every business needs to go through development stages, and it is up to the managers’ talents to ensure that these stages are passed smoothly. The year 2020 was the most challenging for us as we hadn’t been ready for the pandemics and the unfolding events.
Going along with the trend of the preceding four years, we continued to use up a lot of funds every month for improving the work processes, providing capitals investments into the office environment and plenty of other projects. We did not estimate our capacities and miscalculated the market conditions, which causes considerable losses. Eventually we had to make substantial cuts and reassess a number of our approaches to running a business. As Steve Jobs said, “It was awful tasting medicine, but I guess the patient needed it.” Thanks to those mistakes, all this experience, I hope we came to a better understanding of how to move forward correctly.
Are you sorry about that?
Well, on the one hand I am, of course. But on the other hand, I understand that what has been done can’t be undone, and we just need to learn our lessons and use them for our maximum benefits.
What has changed since then?
We reexamined our company at the subatomic level and did a full rethinking. Together with team we looked deeply into every process present in the company, we invited professional consultants for almost every business area, and we did our homework. And it works! Now we have the most successful commercial year, the strongest team ever, and we have a lot of energy to move forward.
We understand the industry much better, we focus more on the long-term success factors, and not only on some short-term indicators. We grow in size, but what I’m most happy about is that we grow in our efficiency.
About entrepreneurial spirit and entrepreneurship in Ukraine.
The Ukrainian business is indeed unbreakable. Just think about it, we’ve had three huge crises over the past 8 years! Two of them involved military combat. I don’t know of any other place on the Earth where people are so devoted to what they are doing that they are ready to sacrifice their lives for that.
While the whole world was expecting that life in Ukraine was about to stop, our Ukrainian entrepreneurs continue to work, to conscientiously pay taxes, to help their employees and the army in general. Just being aware of this encourages us and gives the energy not to give up. As soon as the war is over the business will rebuild the country, and will rebuild it in such a short time that it will be included into history and business course books.
What would you like to tell our readers as a conclusion?
I think a lot has been said today already. Difficult times give birth to strong people. I think the main thing I want to wish everyone who reads this is not to give up and try to emerge from these circumstances with as few losses as possible, both for you and for those around you. If you believe in yourselves and clearly understand your goals, then you will cope, and I sincerely wish you that!