Stakh Vozniak, co-founder of freight tech startup Cargofy, had developed an emergency plan for his team long before Russia launched its full-scale war in Ukraine.
Cargofy develops an AI-driven logistics service to link up truck owners with people seeking to ship goods. According to Forbes, after its $2-million seed round in February, the company was valued at $10-15 million.
And Vozniak's preparation for the worst-case scenario helped the business survive and keep growing.
"Life goes on, and I realize that not all people know about the war in Ukraine. They just want to have their request fulfilled," Vozniak said. "For our business to survive, we had to continue delivering, and we did."
Founded in 2017 by Dimitri Alexiou, Alex Kovalchuk, and Stakh Vozniak, Cargofy is based in Cedar Rapids in eastern Iowa. But most of its 80-person team works from Ukraine.
Several days before the invasion, the company paid its employees double salaries to help them move away from potential hot spots. Later, the startup made a table for employees to check in regularly. This way, the company knew each employee's whereabouts and could help them.
When several months passed, people were safe and the situation became more stable, Vozniak noticed that some employees couldn't stay productive; he had to let them go.
"We were all constantly checking the news. But not everyone had inner resources and motivation to keep working as usual," Vozniak said. “And that’s understandable.”
According to a recent study, nearly a quarter of all Ukrainian startups had to decrease their teams by at least 30%.
Though Cargofy lost some lead-level employees, the company managed to keep all the key C-level personnel and even continued hiring in March. Vozniak started to pay more attention to a person's resilience to stress when interviewing potential hires.
"For our business to survive, we need people who can stay tough and keep others motivated," Vozniak said.
Sudden roll-out in EU
Many of the Cargofy drivers (about 40%) were Russian and Belarusian citizens. Because of the war, Vozniak and his team disabled their accounts and lost a large chunk of their user base.
"Although we recovered by summer, our growth slowed," Vozniak said. "But it was the right decision. We couldn't do otherwise."
Another stress factor for Vozniak in 2022 was a looming recession in the United States. About 90% of Cargofy's revenue came from the States; the financial crisis has slowed the company's growth there to 4% a month.
Vozniak's decision? Diversification. In 2022, the company rolled out its services in five more European countries: Poland, Spain, Italy, Romania and Bulgaria.
"We want to build up traction there to access European investors," Vozniak said. "Right now, in Europe, we are growing 30% a month."
Ukraine's economic front line
Apart from running a business that pays taxes in Ukraine, Vozniak and his team donate, volunteer, and purchase military gear to help Ukraine's Armed Forces win the war.
Cargofy has also developed a web platform called Pomich (Help or Aid in Ukrainian). It helps coordinate the transportation of humanitarian aid and the evacuation of people by matching them (or cargo) with the drivers who can pick them up.
"That's our biggest contribution," Vozniak said. "The number of people we have already evacuated — it's as if we've evacuated a whole town."
Once Ukraine wins the war, Vozniak hopes to keep contributing to the development of its tech industry. According to him, it has everything to make the country one of Europe's largest tech hubs.
"Of course, we aren't there yet, but we're moving in that direction," Vozniak said. "Ukraine will be different — it's just a matter of time."