Dmytro Sholomko, 43, seems to have just the right level of “Google-ness” required for a specialist to spearhead the regional office of the $1 trillion U.S. tech firm.
For 14 years, Sholomko has been advancing Google’s business in Ukraine and has helped put the country on the global map.
Sholomko admits that it’s hard to do business in such an uncertain market as Ukraine, where the government is constantly changing and the economy is unstable. But he’s gotten used to it — the executive has led Google Ukraine through three major crises and has learned to work with different political leaders and to comply with faulty legal and financial systems.
Having seen the worst, Sholomko still thinks Ukraine offers many opportunities for online businesses like Google to thrive.
“Ukraine grows faster than many countries in Eastern Europe,” Sholomko told the Kyiv Post.
Endless opportunities
In Ukraine, Google works as a marketing agency — it helps local advertisers to get the utmost of the company’s online tools like Google Ads, Google Analytics and Programmatic, which are mused to buy and sell ads as well as to analyze their performance.
These tools are the main source of revenue for Google. The tech company made $39.58 billion in 2019. And its business in Ukraine is going well too, given that the number of local internet users is constantly growing.
In fact, the Ukrainian office of Google has been growing since its foundation in 2006, halting only during the six months after the EuroMaidan Revolution in 2014. Even then, the firm quickly recovered as Ukraine introduced third-generation mobile internet in 2015 and people got more accustomed to surfing the web, buying goods and advertising online.
“It is still a long time until Ukraine hits a growth plateau,” Sholomko said.
In the third quarter of 2019, the number of Ukrainians who used a smartphone as their main device to go online surpassed those who go online using desktop computers for the first time, according to the Ukrainian Internet Association. Now mobile phones give advertisers more opportunities than other devices, Sholomko said.
Riding this growth wave, Google Ukraine surpassed its expected revenue milestones several years in advance.
Ukraine, however, still has room for growth: The country lags behind its European neighbors in terms of the spread of mobile internet. This means that, in the coming years, Ukraine can attract seven million new internet users, the most dynamic surge expected in Europe, Sholomko said.
“For this reason, the opportunities to grow online business here in the next five to seven years are endless,” he said.
Meanwhile, the more people use the internet, the more retailers want to go online. The local online retail market grew by 11% in 2019. Moreover, eight out of ten payments were cashless, while more people started to pay with their phones, Ukraine’s central bank states. And Google benefits from this.
Ukraine has become one of the fifteen countries where Google launched its online payment system Google Pay in 2017, and the high popularity of this service, which “even Google did not expect,” has skyrocketed further since then.
Sholomko – who also serves as a member of the supervisory board at local bank Ukrsibbank – said that Ukraine’s e-commerce market has surprised the world in terms of electronic money operations and users’ approach to mobile payments.
“Ukraine is among the countries with the highest e-commerce penetration in the European region,” he said.
Google, however, is not the only company that provides cashless payment services in Ukraine: U.S. firm Apple and some other independent firms are also popular. But Sholomko doesn’t mind them.
“When you think about what your competitors are doing, you are wasting time that you can use to improve the quality of your own business,” he said.
Endless problems
When Google started its expansion outside the U.S., Ukraine was not its priority. The country was invisible as the number of internet users was low.
Sholomko became one of the “Google scouts” in 2006 and met its CEO at the time, Eric Schmidt. They talked about Ukraine, its geographic location and its 40-million population. Schmidt advised Ukraine’s CEO to bet on this while doing business in Ukraine.
Initial expectations were low, but Ukraine far surpassed, Sholomko said. He couldn’t disclose any figures because of the company’s privacy policy though.
Nevertheless, the market remains small. To fix that, it needs more tech companies, which is problematic: Because of weak copyright laws, corruption and ubiquitous bureaucracy, very few, if any, tech firms stay in Ukraine once they gain popularity. Most set up their legal entities elsewhere, including in the U.S. and the European Union.
Another handicap is government instability. Constant Cabinet reshuffles don’t contribute to fast business growth and make Google delay some of its projects in the country.
“We could start working with someone in the government, then this person would leave and we would have to explain everything anew to someone else,” Sholomko said.
That’s why “there is a rule here,” he added. “If you want to become a unicorn” — a startup valued at over $1 billion — “or just a big company, you will have to move (abroad).”
As an example, he cited Grammarly: Founded by three Ukrainians, this artificial intelligence startup valued at $1 billion based its headquarters in San-Francisco, California, leaving only its research and development center in Ukraine. Now, Grammarly is considered American.
And no matter what the Ukrainian government does, it is not going to be enough to make tech companies stay here, because Ukraine will remain poorer and with fewer investment opportunities than many other developed countries, Sholomko said.
“The Ukrainian tech industry will be constantly growing but will remain small” due to this constant outflow of local talent, Sholomko said.
Apart from online advertising in Ukraine, Sholomko’s task is to represent the country’s interests inside global Google, which can be tricky at times.
“I don’t often manage to persuade the ‘central’ team to do something for us because there are always rivals in other countries,” Sholomko said. “When they have to choose Ukraine or something else, they usually choose something else.”
