Cowboy startups and printed houses: Ukraine embraces AI to rebuild its economy

Ukrainians are putting their math skills to work as they build products that should have a lasting impact on the country’s future.

As the night train from the Polish border to Kyiv enters the city, construction cranes are visible in the distance, towering above the town of Irpin on the outskirts of the capital. Irpin, along with the nearby suburb of Bucha, became emblematic of the Ukrainian resistance.

Both were at the center of the failed attempt by the Russian forces to capture Kyiv after Moscow launched a full-scale invasion of Ukraine in February 2022.

A scene of brutal war crimes committed by the invading troops, the two towns now stand as symbols of Ukraine’s resilience and reconstruction efforts, even as the fighting continues to rage in the country’s east.

Showcasing the potential of new technologies in post-war reconstruction is a Kyiv-based 3D printing startup called UTU. The company, founded last year, is behind Ukraine’s first 3D-printed residential house, constructed in Irpin for a family affected by the war.

According to Denis Verbytskyy, a manager at UTU, the three-bedroom house – complete with a dual-purpose room for increased security – was printed in a mere 58 hours. UTU manufactures industrial 3D printers and can print anything from conventional houses to shelters.

“We even got an inquiry to print artificial coral reefs,” Verbytskyy said. What about a Moon base? “Sooner or later – yes, definitely,” he says without hesitating. After all, Austin-based rivals ICON have a $60 million contract with NASA to develop a space-based construction system.

For now, UTU is eyeing markets closer to Earth, both in Ukraine and beyond, where it says it can offer lower prices than ICON or Copenhagen-headquartered Cabod, another 3D printing company it expects to compete against.

At just over two tons, the UTU 3D printer weighs about the same as a large SUV and can be easily transported by crane. It can be installed within two to three hours on the construction site and can start printing immediately.

For printing materials, UTU uses a special mixture it orders from Henkel, a German consumer goods and chemicals manufacturer. The mixture is prepared in the printer directly, which means there is no need for additional equipment, making it potentially cost-effective.

The printer runs on in-house software, which Verbytskyy describes as the “brain” of the machine. “It allows you to get something in ArchiCAD, an architectural design software, in a matter of minutes,” he says.

“We could actually help”

UTU is one of the many Ukrainian startups turning to artificial intelligence (AI) to build their business – and help the country’s economy along the way.

Agritech company HowCow is another example of this new crop of companies. It has developed an AI-based system that detects the best time to inseminate a cow, identifies its health problems, and offers real-time behavior monitoring around the clock.

Describing the platform as “your new farm sidekick,” the company says it can increase farm efficiency by up to 30%, in addition to improving the cow’s overall quality of life.

“It increases milk yields, reduces manual labor, and ensures better health for cows,” says Dmytro Kruhlov, a chief operating officer at HowCow.

Farmers lose a significant portion of their revenue because they fail to recognize the cow’s fertility window, he says, and “it became clear to us that we can fix it.” If successful, it could “boost and support a critical economic sector here in Ukraine.”

Agriculture is one of the key industries in the country, sometimes referred to as Europe’s breadbasket. Along with information technology (IT), construction, military-industrial complex, energy, and engineering, it is one of the six industries that the Ukrainian government designated as the “basis of Ukraine’s economy after the war.”

Founded only six months ago, HowCow has already bagged a contract with a big agriculture firm with more than 30 farms in its portfolio, each with approximately 400 cows. While these are HowCow’s target clients, the system can also be implemented in small farms.

"The product sells for $49 in Ukraine and consists of a monitor device attachable to the cow’s neck and an AI-powered CRM system, which usually stands for “customer relationship management” but in this case, of course, means “cow relationship manager.”

The technology is based on Misu, a human health tracker that HowCow’s team created prior and worked to repurpose after receiving an inquiry from a company abroad. The team, which does not have an agricultural or veterinarian background, was initially skeptical.

“But after some research, after meetings with the veterinary scientists, we found out that we could actually help,” Kruhlov says.

Making it work during war

HowCow was one of the finalists at the startup competition included in the PowerUp Ukraine Conference in June. The conference was organized in Kyiv by Glovo, a Barcelona-based food delivery company that counts Ukraine as its third-largest market, and the Ukrainian Startup Fund, a government agency.

According to Glovo co-founder Sacha Michaud, Ukraine “has a unique combination of talent and startup culture, and local entrepreneurs demonstrate amazing resilience and strength.”

After briefly halting operations immediately after the Russian invasion in 2022, the company recorded a 23% growth this year when compared with pre-war figures and enjoys the dominant market position in Ukraine.

Despite the challenges, Ukraine remains the land of opportunity, according to Hanna Shuvalova from Horizon Capital, the largest private equity firm in the country. The firm closed its latest Ukraine-focused fund earlier this year by raising $350 million in commitments – $100 million above the initial target.

While sectors like agriculture remain an attractive area for investment, the concentration of high-growth, export-oriented, and asset-light companies makes the technology sector a more attractive option for investors worried about risk mitigation.

“At the same time, we believe that the local businesses will thrive as soon as the situation inside the country improves,” Shuvalova says. “It makes perfect economic sense to open a business here because the competition is much lower – for now.”

Technology was the only export-focused sector to expand in Ukraine in 2022 – a year in which its overall economy shrank by over 30% – but recorded an 8.5% decline in exports in 2023 for the first time in years, according to IT Ukraine Association.

It could be partly attributed to external pressures in the global markets, but the impact of war is also increasingly felt as Ukraine comes to terms with the reality on the frontline.

Russia has intensified its attacks, and Kyiv needs more men to push back against the invading forces. New mobilization rules, signed into law by President Volodymyr Zelensky earlier this year, require all men between 18 and 60 to register with Ukraine’s military.

Few of the men working in Ukraine’s technology sector, which employs over 350,000 people, are shielded from being drafted. The war means that Ukrainian businesses “are running with additional weight on their legs,” according to Shuvalova.

Even so, many are continuing to grow by diversifying the Ukrainian market and hiring internationally. AI is also expected to give them a much-needed boost.

“We have very strong math schools. More and more young people are choosing data science as their major. This type of education allows them to work for AI companies and build their own AI startups,” Shuvalova says.

The ability to adapt to rapidly changing circumstances is crucial – whether this means relocating offices to a basement that doubles as a bomb shelter or buying generators to power spaces during blackouts caused by Russians targeting the Ukrainian energy infrastructure.

“Being global and embracing uncertainty is what drives Ukrainian businesses now, as well as working closely with the government to ensure governance and international support,” Shuvalova says.