The Ukrainian company AirSlate, which has a large office in Ukraine, a $1 billion valuation, and $130+ million in investments, has an office in St. Petersburg. And even after almost five months of the full-scale war in its country, the company has no plans to dismiss the local staff.

AIN.Capital talked to the company’s management as well as former and current employees about this situation.

About the company

AirSlate (formerly called PDFfiller) is a well-known Ukrainian project. In June 2022, the company announced another round of funding and gained unicorn status. Its product is a workflow automation service, it has over 100 million users, 900,000 clients, five offices in different countries, and a staff of more than 900 people. During the period of the corona crisis, the project managed to increase its revenue by 65% and raised a total of $130 million (including the recent round) from big investment companies such as Morgan Stanley Expansion Capital, General Catalyst, HighSage Ventures, G Squared, UiPath Ventures, and the US investment firm, operating in Ukraine, Horizon Capital.

The company was founded by investor Semyon Dukach and his friend, entrepreneur Vadim Yasinovsky. Borys Shakhnovych joined the team later. At first, the service was used for the creation, editing, and signing of PDF documents online. Later, many options were added — from a payment system to document generation and digital keys.

AirSlate and Russia

After the full-scale Russian invasion, many AirSlate workers in Ukraine had several questions for the management that can be summarized as follows: Why does the company continue operating in Russia and paying salaries and taxes there? These questions show that many employees were serious about it, including leaving the company as an option if the company would continue to work in Russia.

On March 22, 2022, the co-founders Shakhnovych (CEO) and Yasinovsky made a team call and commented on those questions. During the call (AIN.Capital has a video record), they mentioned the following theses:

• The company condemns the Russian aggression and helps relocate or evacuate its employees, pays aid, and keeps paying salaries to those who went to the army. At the same time, discussing “political” subjects in public or at work is prohibited till the end of the war. The CEO said that during this call. He also said that the questions under Q&A regarding the Russian office are uncomfortable and violate the corporate culture.

“Any attempts to appeal to the management to publicly take one or another side will be declined. If the employees’ political unity and the company’s political alignment are more important to you than your actual tasks, you chose the wrong company; you built the wrong career. So join a political party that reflects your point of view,” Shakhnovych said during the call.

• The company doesn’t plan to fire the Russian staff. If other members of the team are not Ok with it, they should go themselves. 

Many team members didn’t like what they heard. The company’s stance on that is discussed, for example, on DOU. Also, several anonymous sources confirmed it to AIN.Capital.

“I’d noticed the first red flags before I went off to another company. For example, when we were looking for a DevOps for our team, after some time, we were suggested to look at the candidate from Moscow. I was deeply offended and said that that was unacceptable. I was going to have the talk with an HR specialist and ask why they even thought of such an idea, but it all sort of faded. There were many people loyal to Russia, especially in the HR department,“ says an ex-team member who left the company several years ago.

Another staff member, who worked at AirSlate till the war started, confirmed to AIN.Capital that the decision to leave the company was connected to its management stance on the Russian office:

“The only reason to go was that despite numerous appeals from the staff to shut down the Russian office, Borys Shakhnovych and Vadym Yasinovsky publicly stated that they support all the team members from Ukraine and Russia and that they are not going to fire the Russian employees. Anyone who does not agree with that should not work at an IT company and should join the political party instead.“

There are team members who speak in support of the company. For example, the DOU discussion featured some comments on “unhelpful hate” toward AirSlate, for the company has blocked Russian users, makes donations, and helps its team.

“It is beginning to look like a completely vatnic company [Editor’s note: vatnic is a supporter of Russian propaganda), and in fact, it just is not so,“ says another AirSlate employee.

AirSlate does help its team and donates money for humanitarian efforts. According to the company’s statement, it has donated more than two million since the war started.

What are AirSlate’s plans

The company still has the Russian entity ООО «СПБ ФИЛЛЕР» with a revenue of 165.9 million rubles in 2021. The AirSlate management says that it is in the shutdown process. But it does not mean that the company won’t have staff in Russia anymore.

Answering AIN.Capital’s question, the company stated that, in fact, ‘there is a very few developers in Russia, less than 2% of the company.’ There are 900 people working at AirSlate, according to its website, so 2% means a couple of dozen work there. Before the war, the headcount was higher, up to 50 people. Some sources say that Russian team members were partly relocated to other countries.

“As a company, we have decided to limit our involvement with the Russian Federation, and are in the process of ceasing business operations there,“ said the company representative.

But Russian staff will remain — it is a matter of principle. Dozens of people keep working at AirSlate and paying taxes there. The company’s management believes that not all Russians are the same and that the amount of taxes paid in Russia is disproportionate to what the company is contributing to Ukraine through taxes, salaries, and donations.

After the talk of AIN.Capital with the company, its management held another call with the whole team. They were once again reminded that it is forbidden to talk to the press, and they have to stop discussing the shutdown of the Russian office and the layoff of the Russian team.

How the service started

• Back in the 2010s, Semyon Dukach, a famous Ukrainian investor, had an idea for a new project. He decided to discuss it with his friend from Boston, Vadym Yasynovskiy, who had moved to the US when he was 18 and had already launched several successful businesses. For instance, he sold his company Clear Software in 1996 to SPSS for $8.5 million. He worked on several startups together with Dukach.
• By the time PDFfiller (the former name of AirSlate) was conceived, Yasynovskiy had already been “retired” – he traveled the world and was into sports and arts. But the idea for a new startup sparked his interest.
• Dukach’s vision was to offer a service that would allow editing and e-sign PDF documents online. Yasynovskiy liked the idea. He supported the launch financially and agreed to develop the product. This is how PDFfiller came to be.

How the company developed

• The initial investments in the company amounted to $25,000, with $5,000 coming from Dukach, and the rest, from Yasynovskiy. Vadym had a programmer from Donetsk who had worked for one of his former projects. The entrepreneur decided to involve him in the creation of the online PDF editor. As Yasynovsky would later recall, they “somehow cobbled together” a prototype, and it began to grow unexpectedly fast.
• This growth accelerated even more when the team was strengthened by another co-founder, Borys Shakhnovich, who had also moved to the US, studied at Urbana University, and become one of the youngest professors at Boston University, and later Harvard.
• The idea to create, edit and e-sign PDF documents online proved to be in high demand among small and medium-sized businesses in the West. Thanks to Shakhnovich’s efforts, the website’s traffic soared from several hundred to 4 million visits a month.
• Initially, the service was free for users; later, a fee of $0.5 per document was introduced, followed by a subscription plan of $30 per year. Under Shakhnovich’s management, the service added the bank card payment option; since then, the monthly subscription rose to $20, and the annual one — to $72. In the first five years of work, the service gained 15,000 paid subscribers.
• Over time, the service expanded to include not only PDFs but also all types of office documents to work with. Because of this, in 2019, the team rebranded the service as AirSlate.
• At the same time, the startup raised a large investment from General Catalyst ($20 million). Other portfolio companies of this investor include Airbnb, HubSpot, Snap, Stripe, and others. The Ukrainian investor in the project was Horizon Capital, which invested through its Emerging Europe Growth Fund III (EEGF III).
• Since then, AirSlate has repeatedly raised rounds of tens of millions of dollars from prominent investors. For example, in January 2021, the team announced the closure of a $40 million round from Morgan Stanley Expansion Capital, General Catalyst, and HighSage Ventures.

What the results are

• Last year, Forbes was the first to write that the startup had become a unicorn after another investment round. The startup has repeatedly appeared on lists of Europe’s most expensive projects. This is no wonder: in 2021, its audience amounted to 700,000 clients from all around the world. And during the corona crisis, the project was able to increase its revenue by 65% and attract a total of $130m (including the current round).
• As of the time of the latest round of $51.5m, Airslate can boast more than 900,000 paying customers and 100m users globally. So, its co-founder has every reason to celebrate the news on Facebook.

CB Insights ranks companies based on total disclosed equity funding and only considers VC-backed tech companies that have raised an equity round since 2015. During this time, startups from Europe managed to raise almost $117 billion in investments.

Who holds the top spot in Ukraine

As in 2020, the company airSlate (formerly known as PDFfiller) has been recognized as leading by investment amount in Ukraine. In 2019, it received $30 million in investments, and this is the figure that CB Insights has factored in the infographics. After the publication of the ranking, another $40 million round was reported. According to the company’s representatives, $80 million has been invested in airSlate overall.

However, AIN.UA estimates that the leader in terms of the number of investments in Ukraine is the startup GitLab. The company’s product is a DevOps collaboration platform, or, more precisely, a code repository management system for Git. In 2019 alone, the company raised $268 million in a Series E round and was valued at $2.7 billion. With this investment included, GitLab has raised a total of $426 million.

The second top-funded Ukrainian startup is Grammarly. In November 2019, the company raised $90 million. In total, Grammarly has secured $200 million of investments so far. According to TechCrunch, the company has officially become a unicorn – this information was confirmed to AIN.UA’s editors in Grammarly. More details about the company can be found here. And while GitLab has no development team here, Grammarly has a fairly big one.

Other results

• The top-funded startup in Europe is Sweden-based Klarna, which offers a “buy now, pay later” e-commerce solution. The company has raised nearly $1.8 billion.
• The top 3 most well-funded startups also include a UK-based food delivery service Deliveroo ($1.5B) and used car marketplace Auto1 Group in Germany ($961M).
• Eight of the 37 companies featured on the map are unicorns. Some of them operate in Ukraine: Bolt ($4.3B) and Glovo ($1B), Deezer ($1.4B).
• Collectively, the startups on the map have raised nearly $9B in disclosed equity funding.

Investments

The foreign investor is the investment company General Catalyst. It became the lead investor in the transaction with an alleged investment of up to $20 million. Previously, General Catalyst had already invested in Ukrainian Grammarly and became the lead investor of the round with $110 million. Other investments of GC include Airbnb, HubSpot, Snap, Stripe, and hundreds of others.

The Ukrainian investor is Horizon Capital investment company. It invested in PDFfiller through its new Emerging Europe Growth Fund IIІ (EEGF IIІ). According to the public data, the investment company invests from $5M to $20M through EEGF IIІ. Reportedly, the investment was similar to the previous Horizon Capital investment in Ajax Systems – $10 million.

They started to prepare the deal about a year ago, in the summer of 2018. In December 2018, the company issued new shares.

General Catalyst, Horizon Capital, and PDFfiller refused to comment on the deal.

Rebranding

AIN.UA also learned that PDFfiller is undergoing rebranding. The company has changed its name to airSlate. Reportedly, the reason for the name change was confusion: PDFfiller’s activity is not limited to working only with the popular PDF-format. The name AirSlate will help avoid this confusion.

What PDFfiller/airSlate does

PDFfiller is a SaaS company, the main product of which is the eponymous document management service. According to company representatives, PDFfiller has more than 400,000 customers, the number of its employees exceeds 500 people with the majority located in Kyiv, and others in Boston.