Ukrainian venture capital firm Flyer One Ventures (F1V) has launched a €50 million (US$54.25 million) fund, named Fund V.

The fund is supported by the International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD) and aims to invest in early-stage tech startups in Ukraine and Central and Eastern Europe (CEE).

The EBRD has committed €6.5 million (US$7.05 million) to the fund, with a possibility to increase this to €10 million (US$11.68 million).

The IFC has invested €5 million (US$5.84 million), which includes up to US$3 million from Japan through its Economic Resilience Action Program.

F1V plans to invest up to US$1.5 million in pre-seed and seed-stage software startups.

The firm has previously invested nearly US$45 million in over 90 startups, including Fintech Farm, Liki24, Jome, and Mate academy.

🔗 Source: Tech.eu

🧠 Food for thought

1️⃣ Ukraine’s tech ecosystem shows remarkable war-time resilience

Flyer One Ventures’ new €50 million fund represents a continuation of Ukraine’s tech momentum that began well before the war, building on earlier successes like Grammarly’s unicorn status and Readdle’s 100 million downloads without external funding 1.

This resilience is particularly impressive considering that despite global VC contraction, CEE region funding (including Ukraine) decreased only 15% in 2023, compared to 35% in Western Europe, demonstrating greater stability during economic challenges 2.

Ukrainian startups have continued to attract investment interest despite the conflict, driven by the country’s strong technical foundation with a projected 300,000 IT specialists by 2025 and a 20% annual increase in IT graduates 3.

The fund’s focus on software startups aligns with Ukraine’s established strengths in digital services, which had already shown impressive growth with digital exports increasing by 20% in 2020 before the full-scale invasion 4.

This institutional backing sends a powerful signal about confidence in Ukraine’s tech future, particularly notable as F1V’s previous investments have already resulted in acquisitions by global tech leaders like Pinterest.

2️⃣ International financial institutions play crucial role in wartime economic resilience

The backing of F1V by both the EBRD and IFC represents a significant evolution in how international financial institutions approach conflict zones, focusing on sustainable economic development through technology rather than just humanitarian aid 5.