Grammarly was founded in 2009 by three Ukrainians: Maksym Lytvyn, Oleksiy Shevchenko, and Dmytro Lider. In 2021, the company attracted $200 million in investment, which valued Grammarly at $13 billion. Subsequently, Lytvyn and Shevchenko became dollar billionaires. In 2021, Shevchenko and Lytvyn’s shares were estimated at $4 billion each, in December 2022 — $2.2 billion.

The current numbers:

• Shevchenko and Lytvyn occupy the 1644th place in the list of the richest people in the world.
• A year ago, they were on 1322 and 1333 places, respectively.
• Grammarly’s estimated market capitalization is now $8.1 billion.
• Last year, the capitalization amounted to $9.8 billion.

Possible reasons for the drop:

• The overall decline in the startup market: in 2022, the assets of 44 Forbes unicorn founders decreased by $96 billion.
• Decline in venture capital investment: global venture capital investment fell by 35% in 2022.
• Layoffs at Grammarly: in early February 2024, the company laid off 230 specialists (5% of its workforce).
• Slowing revenue growth: Grammarly’s revenue grew by 24% in 2023 (to $125 million), but growth slowed by 10% compared to 2022.

More on the layoffs: Recently, the news started circulating that 230 members of the Grammarly team were laid off, 37 of whom were in Ukraine. The company noted that the restructuring was not related to the costs optimization, Grammarly’s business remains profitable and continues to grow.

• Founded in 2009 by Ukrainians Alex Shevchenko, Max Lytvyn, and Dmytro Lider, Grammarly is a Ukrainian company that provides a digital writing assistant to help people write clearly and effectively in English. The basic set of Grammarly’s features is free, and the advanced version is available by subscription.

GrammarlyGO is a new generative AI product that accelerates productivity where people write. The tool can quickly generate highly relevant text with an understanding of personal voice and brand style, context, and intent. It enables people and businesses to unlock their potential, save time, and get more done while prioritizing trust, security, and authenticity.

“Generative AI represents an inflection point in innovation that Grammarly can incorporate to deliver even more value for our customers. For well over a decade, we’ve delivered the leading AI-enabled communication assistant focused on helping people and businesses overcome the real challenges they face every day. Now we enter a new phase in our vision to support our customers across all stages of communication, going past revision into conception and composition — all while maintaining our high standards of quality, privacy, and security,”

Rahul Roy-Chowdhury, Global Head of Product at Grammarly, commented.

What can GrammarlyGo do?

GrammarlyGO will use personal, organizational, and situational context like voice and style, where the user is writing, and their purpose — to generate relevant tailored communication. With GrammarlyGO, users can rewrite, compose, ideate, and reply within the applications and websites they’re already on —boosting efficiency right in their flow of work. GrammarlyGO enables individuals and businesses to:

• Compose text: With a quick prompt, users can compose a high-quality, tailored draft right where they’re working.
• Reply to emails: GrammarlyGO understands the context of emails and offers relevant one-click prompts (like “I’m interested” or “I’m not interested”) for users to quickly draft thoughtful replies.
• Rewrite for tone and clarity: Transform entire sections of writing to be clearer and use the right tone, whether to improve its friendliness, professionalism, or more. Users can choose from prompts or input their own to rewrite their selected text.
• Rewrite for length: Transform writing to be just the right length, making it longer or shorter at the click of a prompt. 
• Ideate: Augment creativity and speed up content creation by using GrammarlyGO as an AI ideation partner, generating outlines or ideas to reference or add directly to the text.
• Personalize their voice: Users can set their preferred tones and professional role to generate writing personalized to their voice and needs. 
• Use prompts as a guide: GrammarlyGO leverages unique context to suggest one-click prompts for jumpstarting or improving writing.

GrammarlyGO will be available across Grammarly’s product offerings, including Grammarly Free (in select markets), Grammarly Premium, Grammarly Business, Grammarly for Education (higher education), and Grammarly for Developer.

To learn more and get access to the upcoming GrammarlyGO beta, the users can watch a demo video and apply for beta access starting in April, here.

• It is the fifth Grammarly hub. The company already has ones in Kyiv, San Francisco, New York, and Vancouver.
• The company embraces a remote-first hybrid working model. It means that the team members can work remotely and meet quarterly at the hubs to work together for a few weeks.
• So far, Grammarly already employs over 700 people. And the company continues to expand its global team, offering more than 100 job openings.
• The company invites Ukrainians who temporarily left Ukraine due to the war to apply for jobs in Germany, Poland, and Portugal.

Grammarly retains its two-story hub in Kyiv, but now it remains closed for safety reasons. All current and new colleagues in Ukraine work only remotely for now.

Grammarly keeps supporting members of the Ukrainian team in Ukraine and abroad. All Grammarly team members who require extra days off to volunteer or take care of family or their health — can have extra paid time off from work. Professionals who become members of Ukraine’s Armed Forces will keep paid for twelve months.

Grammarly is a Ukrainian company that provides a digital writing assistant to help people write clearly and effectively in English.  The company was founded by Ukrainians Alex Shevchenko, Max Lytvyn, and Dmytro Lider in 2009.

• GoSolo is a digital toolkit that simplifies starting and running a company. It helps quickly register a company in the UK, get a virtual address for business correspondence in London, and an account for payments together with a card.
• Grammarly co-founders, Max Lytvyn and Alex Shevchenko, led the GoSolo round. They were joined by funds from SFC Capital, Menlo, and several top executives from the startup Stripe.
• GoSolo launched its product in early April 2022 and has already gained several thousand customers.
• Dmytro Pimakhov, the founder of GoSolo, expects that startups, inventors, and marketplace merchants will use his service.

“More than 30 million people use Grammarly daily to improve their written communications. The AI-powered tools not only help with spelling and grammar, but also improve writing quality, consistency, clarity, and efficiency,”

TIME writes.

About Grammarly

Grammarly is an AI-based grammar and writing tool. The company was founded in 2009 by Ukrainians Alex Shevchenko, Max Lytvyn, and Dmytro Lider.

In November 2021, Grammarly closed a $200 million round and became one of the ten most expensive private tech companies in the United States with Ukrainian founders. The valuation of the business has grown to $13 billion. The company has offices in Kyiv, San Francisco, New York, and Vancouver.

In Grammarly, the editor of AIN.UA was told why this round was needed, whether an IPO is being prepared, and how this will affect the Ukrainian staff of the company.

This round doubled the amount of capital previously raised by the company. Why such a sum? Does Grammarly really need so much money just to further develop its products and team? 

Grammarly was founded in 2009 and adhered to a self-sustaining model until 2017. The company became profitable within a few years after its foundation and now remains so. We did not need external capital to support our operations and develop our business.

The new round will help us attract the best talent, accelerate team growth, and develop innovative solutions for Grammarly products. Also, new investors joined us this round (Baillie Gifford and funds and accounts managed by BlackRock), who make excellent financial partners. Their experience and expertise will help Grammarly on its way to new achievements and milestones.

How did you choose the funds, or did they come up with an offer themselves? How long did you negotiate? When did you actually close the deal?

The first stage of the round was closed on November 17th. The second phase is potentially expected in December.

Previous investors also joined the round, in particular General Catalyst. New investors (Baillie Gifford and the funds and accounts managed by BlackRock) are world-renowned companies with experience and expertise that are of great value to Grammarly.

What are the founders’ shares in Grammarly today?

The composition of Grammarly’s owners is wider than the one of founders and includes, in particular, Grammarly investors (Baillie Gifford, General Catalyst, Institutional Venture Partners, Spark Capital, as well as funds and accounts managed by BlackRock).

As a privately held company, we do not disclose details of the ownership and distribution of shares. It can be noted that the shares of Max Lytvyn and Alex Shevchenko (initial investors) differ from the share of Dmytro Lider, which is about 1%.

How many employees do you plan to hire? How big is the team in Ukraine, and how much will it grow?

Currently, Grammarly employs over 600 team members, more than 270 of them work in Ukraine, and the company continues to grow.

We plan to increase the team by 50% next year in Ukraine alone.

What kind of specialists are you looking for in Ukraine and what are you ready to offer them? Will you give them stock options?

Now we are looking for engineers (Front-End, Back-End, Security, ML, DevOps, MacOS, etc.), as well as professionals to join sales and user support teams, product and recruiting teams. All open positions are constantly updated on our website.

Our company adheres to a remote working model in a hybrid format: our colleagues can work remotely from any city in Ukraine and come to Kyiv for quarterly meetings with the team.

Grammarly offers a competitive compensation package that matches the market, industry, and positions for which we are hiring new colleagues. We respect the confidentiality of our team members and do not disclose information about the financial package, in particular options.

Grammarly has released a lot of new products in the last year. Which ones are generating the most revenue? How do your financial results grow from year to year?

Grammarly was founded in 2009 and adhered to a self-sustaining model until 2017. As a privately held company, we do not disclose other financial results.

Do you plan to go public? If so, what are your goals?

We consider raising investments as separate stages in our long journey. In the future, an IPO could be one of them. We will be ready to share our IPO plans at a convenient time.

Update data on user base activity. What is the percentage of paid subscriptions?

The number of daily active users (DAU) is 30 million people worldwide, including 30,000 business client teams. In the last year alone, the number of corporate clients of Grammarly with large contracts has grown by more than 250%. Among them are such leading brands as Zoom, Cisco, Expedia, and others.

How large is the market for Grammarly today? What are the main challenges you face?

Grammarly is committed to helping everyone who uses English in their personal and professional communication. Today, Grammarly helps create effective texts for applications and websites, totaling over 500,000. And we continue to work to expand our service coverage to support Grammarly users wherever they can communicate in English.

We’ve long focused on more than just basic writing mechanics like grammar, spelling, and punctuation. End-users are at the center of our business model — not advertisers or third parties. Our long-term vision is to create a comprehensive communication assistant that helps people understand each other better. There are still many tasks ahead of us on this path:

• We are working on complex aspects of communication and have implemented tips that help users express themselves clearly, understandably, and consistently. In our service, you can already choose the purpose of the message and see suggestions based on that purpose. Thanks to the tone detector, you can determine how the recipient will potentially perceive your message and, if necessary, make changes to it.
• With our new product, Windows and Mac desktop application, we have further expanded our communication support.
• We will also pay attention to the development of new partnerships — our partnership with Samsung was one of the first steps. And thanks to the launch of the Grammarly for Developers platform, we will be able to support even more clients exactly where they communicate in English. Access to the Grammarly API helps to create additional value for other services and applications and saves other businesses the time and resources that would go into developing their own technology solutions in the field of natural language processing.
• The priority area for the company remains the product for business clients — Grammarly Business. And we continue to work on developing new features to support business customers and their needs.

These are just a few of the natural language processing tasks that the Grammarly team will be working on in the future.

• The application works on Mac and Windows. It is now compatible with other computer programs, such as Microsoft Office, Slack, or Discord.
• The developers say it will help you create presentations, communicate via email, or make content for social media since now you can use it in Microsoft Powerpoint, Google Sheets, and Canva.
• Previously, Grammarly was available as a browser extension, web app, Microsoft Word extension, and keyboard for Android and iOS.
• Besides correcting grammatical mistakes, the program also helps you control the tone of your message, avoid stylistic errors, and suggest more concise and readable formulations. Grammarly analyzes your text in real-time — start typing your message, and it will suggest edits.

Recently, Grammarly has raised $200 million with a $13 billion valuation. It employs over 600 people in San Francisco, Vancouver, and Kyiv. Over 30 million users globally are now using the company’s product.

• The amount of investment is $200 million. This is the largest round in the history of the company.
• The valuation of the business has grown to $13 billion, which is six times more than the company’s last known valuation.
• Among the investors are Baillie Gifford, General Catalyst (invested in the Ukrainian company AirSlate), and several investment firms managed by BlackRock.
• The money will be used to improve the company’s products and expand the team.
• Grammarly has 30 million daily users.
• The company employs over 600 people in San Francisco, Vancouver, and Kyiv.

Grammarly is an AI-based grammar and writing tool. The basic set of features is free, and the advanced version is available by subscription. The company was founded in 2009 in Kyiv by Ukrainians Alex Shevchenko, Max Lytvyn, and Dmytro Lider.

The fortune of each of the founders has increased significantly. Before this round, they owned 76% of the company in equal shares — the estimated wealth was $585 million each. The company did not confirm this information. We previously reported that the stakes of all three founders grew in equal proportions after the investment. However, according to AIN.UA data, only Litvin and Shevchenko’s stakes increased. The company does not disclose the exact size of the two shareholders’ stakes, as well as the sum of their fortunes.

Previously, the company raised two rounds of investment, $110 million in 2017 and another $90 million in 2019, after which it officially received unicorn status.

Today Grammarly is the most valued private technology company with founders from Ukraine and a huge local team.

Who is the richest in the IT industry

• 8th place in Top 100 richest Ukrainians in 2021 is taken by the co-founder of the UK-based fintech startup Revolut, Vlad Yatsenko. His net worth is estimated by NV at $1.277B. In July of 2021, Revolut raised $800M, and its valuation increased sixfold: from $5.5B in 2020 to $33B.
• 14th spot is occupied by the founder of the aerospace firm Firefly Aerospace, Max Polyakov, with a fortune of about $540M. In May of 2021, Firefly Aerospace raised nearly $200M, and its valuation went way beyond $1B.

According to AIN.UA’s estimates, the ranking takes just one of Polyakov’s assets, Firefly Aerospace, into account. It was valued at more than $1B even before its launch. The worth of his other aerospace companies and all the IT businesses are not factored in.

• 17th place is held by the owner of Rozetka Vladyslav Chechotkin. According to NV, Chechotkin’s net worth is $472M.

The share of Vladyslav Chechotkin is often miscalculated, with the total attributed to Chechotkin alone. But this includes shares of two entrepreneurs, Vladyslav and Iryna Chechotkin, who own the company that the stake in Rozetka belongs to. Thus, according to AIN.UA’s own calculations, the figure of $472M reported by Novoye Vremya is in the range of $359M to $526M but should be attributed to both stakeholders.

• Spots 23, 24, and 25 are taken by Alex Shevchenko, Dmytro Lider, and Max Lytvyn, the co-founders of Grammarly, an online spelling and grammar checker. NV estimates each one’s net worth at $386M.

In calculating the wealth of the co-founders of Grammarly, the valuation of the company at $2.3B should be factored in, as cited by PitchBook and confirmed by the American Forbes magazine. Considering that the latest round took place back in 2019 (the co-founders’ shares have remained the same) and their cumulative share being 76%, the valuation of the fortunes of Alex Shevchenko, Dmytro Lider, and Max Lytvyn, according to AIN.UA, should be about $582M each, which is $196M more than cited by Novoye Vremya.

• The founder and CEO of Ajax Systems, Aleksandr Konotopskyi, is in 26th place, with a net worth of about $380M.
• No. 30 is occupied by one of the co-founders of GitLab company, Dmytro Zaporozhets, with a fortune of approximately $375M. On October 14, 2021, Gitlab went public on Nasdaq. Today its shares are listed on the market at $113.75 per share, and its total capitalization exceeds $15B. Dmytro Zaporozhets owns 2.5% of the firm’s stock, hence his high position in the ranking.
• 37th spot is taken by the founder of People.ai, Oleg Rogynskyy. NV estimates his net worth at $279M. In August of 2021, People.ai raised $100M as part of a new investment round and was valued at $1.1B. As such, the company became a unicorn. Besides, Oleg Rogynskyy has mentioned that, given the current size of the company, it is time to think about an IPO.
• 42nd and 51st positions are held by the co-founders of the IT company SoftServe Taras Kytsmey ($245M) and Yaroslav Lyubinets ($199M). Taras Vervega ($167M), Yuriy Vasylyk ($131M), and Oleh Denys ($130M) are ranked 63rd, 77th, and 78th, respectively.
• 48th place in Top 100 richest Ukrainians in 2021 is taken by the founder and director of Terrasoft company, Katherine Kostereva, with a net worth of $207M, according to NV.

The calculations by AIN.UA show that the value of Katherine Kostereva’s share is significantly lower. At the time of leaving Terrasoft, Alexander Popov owned a 44.75% stake, valued at $51M. Based on the information that he and Kostereva had equal shares, hers should be valued at $51M too, instead of the $207M cited in the NV ranking.

• Oleksandr Kosovan, CEO and founder of MacPaw, is ranked 52nd. His net worth is estimated at $196M.
• Spots 53, 98, 99, and 100 are taken by the co-founders of Fintech Band, the developers of monobank Dmytro Dubilet with $196M, Oleg Gorokhovskyi — $100M, Yevheniya Kryvenko (Yatsenko) — $100M, and Mykhaylo Rogalskiy — $100M.

Who else has made it into the Top 100 richest Ukrainians in 2021

• 22nd place is occupied by the director general and co-owner of Fozzy Group, Volodymyr Kostelman. His fortune is estimated at $388M. Beside him, the ranking also features Roman Chyhir ($175M) and Oleh Sotnykov ($175M), ranked 58th and 59th, respectively. Fozzy Group also has an IT subdivision, and recently, they have tested a service to compete with zakaz.ua.
• The net worth of $346M has earned 32nd place to Stepan Chernovetskyi, head of the investment company Chernovetskyi Investment Group having some IT projects in its portfolio.
• No. 39 and No. 40 are taken by the co-founders of Nova Poshta, Volodymyr Popereshnyuk and Viacheslav Klymov, with a fortune of about $273M each.
• The developer Vasyl Khmelnytsky with a net worth of $223M is ranked 43rd. His main asset is UFuture Investment Group.
• 91st spot is occupied by the owner of the multistore Comfy, Stanislav Ronis. His net worth is estimated at $111M.

The richest five

At the top of the ranking, like in the last year, comes Rinat Akhmetov, whose fortune is valued at $11.5B (to put this into context: last year, Akhmetov’s wealth was estimated at nearly just half as much, $6.6m). The top 5 also include Viktor Pinchuk ($2.6B), Vadym Novynskyi ($2.44B), Petro Poroshenko ($1.52B), and Kostyantyn Zhevago ($1.497B).

Access to the Grammarly API will allow developers to:

• Integrate English text improvement tips into their product. Text Editor SDK is compatible with any browser-based web application, as well as with Chromium-based desktop applications. It supports data exchange between the app’s text box and Grammarly cloud services and manages all interface components.
• Offer users recommendations from Grammarly in the text boxes of their application. Text Editor SDK is based on the Grammarly service and helps to improve four aspects of texts: accuracy (grammar, spelling, punctuation, and other writing mechanics), clarity (brevity and intelligibility), fascination (vocabulary and its diversity), and tone (formality, politeness, certainty).

Grammarly claims that the developers can be assured of the safety and security of user data.

About Grammarly

Grammarly was founded in 2009 by Ukrainians Alex Shevchenko, Max Lytvyn, and Dmytro Lider. In 2019, Grammarly acquired unicorn status by closing a $90 million funding round. The company has offices in Kyiv, San Francisco, New York, and Vancouver. Grammarly’s service is used by over 30 million users and in 2020 alone, it provided 1.2 trillion text improvement recommendations to users from around the world.

More detailed information about the contest is described in the account of the company on HackerOne. Among them are:

• The reward for the first critical vulnerability report is $100,000. But there are also prizes of $25,000, $12,500, $2,500 (depending on the level of vulnerability).
• Participants are required to:
  • Be ethical hackers;
  • respect privacy and interact only with Grammarly test accounts that are provided for the contest;
  • Avoid testing that would result in privacy violations, destruction of data, or interruption or degradation of our service;
  • Contact the company immediately if you inadvertently gain access to user data; such data must not be viewed, changed, stored, or transferred.

The company says it is the biggest prize in the history of its Bug Bounty program. Since its launch in 2018, the company has paid about $142,000 to cybersecurity professionals for the vulnerabilities found.

What happened

• Grammarly switched to a remote work format in March 2020. According to management’s plan, the employees planned to return to the offices when it was safe to do so. However, after a while, the company decided to continue the remote work format permanently.
• However, the remote work will be in a hybrid format. In the future, team members will periodically meet with their colleagues for in-person collaborations. As Grammarly representatives explain, these meetings could consist of strategic planning or launching cross-functional projects.
• The meetings will be held quarterly at one of Grammarly’s hubs in Kyiv, San Francisco, New York, or Vancouver. 
• Besides, the employees who wish to work from the office will be able to do so – the offices will be open.

“The hybrid WFH work model assumes that all members of the same team will be in three adjacent time zones with a common hub while working remotely. This will provide at least six hours of overlap during the workday for fast communication and convenient organization of online meetings,” the company commented.

Grammarly plans to implement the hybrid-remote working model starting in 2022. Until then, the staff can work remotely on a full-time basis without having to attend offline meetings quarterly.

Why it’s important

During the pandemic and quarantine restrictions, many companies switched to remote working. In 2021, in a world where much of the population has been vaccinated and COVID cases are decreasing, there are still people who prefer to work remotely. For example, previously, Apple announced its plans to bring employees back to the office, but some employees pushed back against it. Moreover, many employees already had to quit during the pandemic due to an inability to work from home, and now still others are being forced to choose between family or Apple.

About the company

Grammarly was founded by Alex Shevchenko and Maxim Litvinov from Kyiv in 2009. The company develops an online AI-based writing assistant that helps people proofread and edit their documents.

In 2017, Grammarly raised $110 million during its first funding round. Then, in 2019, it secured another $90 million in the second round and became a unicorn. Grammarly’s total valuation exceeds $1 billion. Today, the company employs over 500 people in Kyiv, San Francisco, New York, and Vancouver.

• A total of 429 companies registered in the United States made Inc.’s 2021 Best Workplaces list. In particular, the magazine highlighted employers who were able to organize workplaces for the effective work of employees during the coronavirus pandemic and forced remote work. The list features companies in 24 fields, including IT, advertising, logistics, and others.
• The list includes Grammarly, a company developing an AI-powered English writing assistant. In 2009, it was created by Alex Shevchenko and Maxim Litvinov from Kyiv. In 2017, Grammarly raised $110 million during its first funding round. Then, in 2019, it secured another $90 million in the second round and became a unicorn. Grammarly’s total valuation exceeds $1 billion. Today, the company employs over 400 people in Kyiv, San Francisco, New York, and Vancouver.

“Our employees are ethical, adaptable, gritty, empathetic, and remarkable. These core values connect a global team, enable effective collaboration and push us to grow personally and professionally. Team members are encouraged to take ownership of their roles by seeking opportunities for education, expanding their impact through knowledge sharing and peer coaching and taking accountability for work they proactively deem beneficial to the organization. As a community, we stay connected with global offsites, monthly team and office events, birthday and anniversary celebrations, and holiday parties,” Grammarly commented to Inc.

• The list also features GitLab, a DevOps platform that enables product development, QA, security, and operations teams to work concurrently on the same project. Dmytro Zaporozhets from Kharkiv has been working on GitLab since 2011. In 2013, a second founder, Dutch entrepreneur Sid Sijbrandij, joined the startup. Even though the company has no offices, the number of employees exceeds 1,300 worldwide. As of 2021, the total amount raised is over $420 million. In 2019, GitLab was valued at $2.7 billion.

“As the world’s largest all-remote company, GitLab has blazed a trail for other businesses adapting to remote work during the pandemic and has advised more than 50 organizations on how to maintain a sense of culture, connection, and collaboration. We expect every employee to be a leader, no matter their job title or seniority. Our people managers help guide employees with career development, but each individual has the autonomy to determine their daily schedule, where to work, and their time off. We care about the results of our employees’ work, not when or where they’re doing it,” GitLab representatives told Inc.

• Besides, Inc. listed the Belarus-based company PandaDoc, which announced the opening of an office in Ukraine in September 2020. Now the company is looking for employees to join the Kyiv team.

To recap, previously, the list of the best employers was compiled by the American Forbes. It featured the Ukrainian companies GitLab and Allset. Click here for more information.

What is UA-GEC dataset

GEC dataset is an array of texts written by volunteers, worked through by linguists, correcting stylistic, spelling, and other errors. In general, the concept of Grammatical Error Correction (GEC) means correcting grammatical errors.

As Grammarly says, the dataset is designed for academic and practical language learning. As of its launch, it includes more than a thousand texts of various genres. Almost 500 volunteers from Ukraine and abroad were involved in its creation. The GEC dataset will be expanded.

The GEC corpus for the Ukrainian language can be downloaded here.

Project goal

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.

What it takes to create UA-GEC dataset

In order for the algorithms to “speak” in Ukrainian, Grammarly gathers user texts – these can be posts from social media, blogs, articles, essays, poems, and letters. Linguists will check the texts to correct stylistic and spelling errors.

“Ukrainian is a language with developed morphology. Unlike English, each word here has many word forms (книга, книгою, книгами). The NLP techniques, developed for English, will not always be optimum for the Ukrainian language. Searching for the best methods of working with such languages is a special task, and our dataset will be useful here,” the company explains.

How will this project contribute?

• will improve the development of voice assistants and online systems for correcting grammar in Ukrainian;
• will help to use the high-quality Ukrainian language on the Internet;
• will increase the number of open tools for NLP learning of Ukrainian.

How to help

GEC dataset of the Ukrainian language will be published in free access. No financial remuneration for participation in its creation is provided, however, in this way any user may contribute to the development of the Ukrainian language online.

The gathering of the texts will last until September 13. You can send a ready-made text or write a new one here.

• Startup Docugami was founded in 2018 by former Microsoft team member Jean Paoli. He is also one of the inventors of XML.
• Docugami is developing AI to end document dysfunction.
• The company creates tools that can understand different parts of a document and use them uniquely, depending on the type of company. Thus, new ways of speeding up the work, monitoring of reporting according to legal and regulatory requirements will appear.

“I’m glad to announce a new step in our journey: an investment in the Seattle-based company Docugami. We feel strong alignment with Docugami’s team and vision, and we took this step with much thought and deliberation. We’re excited to play a part in their future,” said Brad Hoover, Grammarly CEO.

The Grammarly account has already raised a total of $200 million in investments. In 2019, the company attracted $90 million with a $1 billion valuation and became a unicorn.

The rating takes into account not the capitalization of the company, but the value of the brand. It is estimated based on the financial results of brand owners, as well as other factors: geography, technological component, investment attractiveness of the industry, and so on.

Over the past year, the first hundred Ukrainian brands added 4.7% of the price, now it is estimated at $6.2 billion. The top three have not changed: Morshynska ($550 million), Nova Poshta ($310 million), and Rozetka ($302 million). Below is the top ten of the rating, the full list is available here.

This year, Grammarly and Petcube technology companies were included in this year’s ranking for the first time. The brand of the software developer for proofreading English was estimated at $150 million (12th), and the manufacturer of devices for pets was estimated at $25 million (52nd).

The list also includes telecom operators Kyivstar ( $141 million, 13th) and lifecell ( $100 million, 19th), but Volia dropped out. In addition, there are brands from the e-commerce industry: Citrus ( $65 million, 29th), Foxtrot ( $48 million, 36th), Allo ( $41 million, 38th), Comfy ( $22 million, 55th), and Prom.ua ( $14 million, 69th).

Thus, Grammarly already has a total of $200 million in investments. According to TechCrunch, the company officially became a unicorn.

About Grammarly

Grammarly develops a digital writing tool using artificial intelligence which helps to write texts in English.

The company plans to invest towards further improvement of the technology. Grammarly’s goal is to create a comprehensive assistant for personal and professional communication in English.

Grammarly intends to improve its product and will continue to work on more complex aspects of language and communication, in particular on the development of the recently launched tone detector.

History & Growth

The company was founded by Ukrainians Maksym Lytvyn, Oleksii Shevchenko, and Dmytro Lider in 2019 in Kyiv.

Grammarly is a profitable company since 2011.

According to the company, since the first round of investment in May 2017, Grammarly has increased the number of users more than three times. Currently, it has got more than 20 million daily active users.

Team

Grammarly is also growing in the number of employees. The company opened its fourth office in Vancouver and doubled the number of team members in offices in Kyiv, New York, and San Francisco.

The plans for the near future are to expand the current office space in Kyiv by an additional 1,300 sqm, which will accommodate another 130 people.

How will this affect the market?

According to Denys Dovhopolyi of GrowthUp Group, this is a landmark deal for the Ukrainian startup and venture capital market.

Even though now Grammarly is actually an American company, it has enrolled Ukraine to the club of home countries unicorns. On the other hand, the company shows one of the steepest ways of startup development:

Firstly, yes, Ukrainians with already existing experience can found companies that play a significant role in the global venture capital ecosystem. Secondly, startups can be created with little or no external financing, and then it can make its way to the market using revenue.

And the main thing is developing a product that solves a really serious problem that millions of users face every day,” says Denys Dovhopolyi.

We’re fairly active in content-marketing and were on the front page of USA Today this year: we conducted a study on the grammar skills of Democrats and Republicans. The reason we place such an emphasis on content-marketing is the idea of raising awareness. The area that we work in and the problems that we solve are quite real and wide-spread. But people get used to basic spell-checker utilities and don’t bother going deeper. Grammar and spelling is studied in school and college, which means most of these skills are forgotten by the time the educational period is over.

Our social and business mission is to make as many people as possible aware of the problem of low-quality texts and poor grammar. We want to start a social discussion. The issue itself defines the perception of conversations in correspondence. The level of trust to the author of a poorly written email usually plummets. A single CV mistake may leave you without a job, one mistake in an essay may mean you don’t get accepted to a college. We’ve been doing content-marketing for several years now and it’s one of our main [public communication] channels.

Aleksey Shevchenko, cofounder of Grammarly. Photos by Olga Zakrevska

Grammarly@EDU is our product that deals with metrics, it measures the effects of our service on the literacy of the English-speaking world. This is the product that we sell to colleges and universities. They license the product to their students, who can use the service free of charge. When someone claims that they possess the technology to improve literacy, colleges evaluate these claims on a serious level: they study the product’s effectiveness extensively before buying. They don’t fall for cheap marketing ploys.

There are two respectable studies, conducted by scientific specialists, on how Grammarly influences literacy and the quality of writing. The Central Michigan University study has shown that the grades of students using our service are higher by 1/3 of a point (on a 5-point scale) than the grades of students that don’t use Grammarly. The Flinders University in Australia conducted a poll among its students about the effects of our service on their academic life: 84% of respondents stated that it has helped them improve their grades and gave a general surge of confidence in writing texts. This is the evidence that we quote when engaging colleges.

We have a thorough understanding of when and why people most often use Grammarly. It was initially created as a product aimed at students. It even had a different name. The first year and a half of our business development was directed specifically towards this target audience. It still constitutes a large part of our user base, approximately 25%.

Another large section of our audience is made up of specialists in specific professional areas: lawyers, consultants and other experts that deal with important documents. This is their daily routine and there is no room for mistakes there. Customers like these make up around 40 to 60% of our user base. Grammarly is also often used to verify the quality of technical/technological texts: it’s used while writing user manuals, instructions, medical texts and so on. Another category is the individuals that make a living through writing: journalists, bloggers, content creators.

We have corporate clients as well, but their percentage is relatively low. We integrate the so-called consumerised enterprise into our service. This is a distribution model that is relevant to other services like Slack (for example). When several people in the company start using our product, it spreads to the entire company. It goes something like this: a few company employees buy our product for themselves and soon realize that it’s simply necessary in their work. They spread the word among their colleagues and, sooner or later, the information reaches the procurement department. The latter goes ahead and purchases numerous licenses for the entire office. But the process always starts from regular users.

Two billion people in the world speak English. Less than half of those are native speakers. The rest are either in the process of learning English or use it professionally.

The grammar-check market

There was no fully-fledged spell-checker market before Grammarly came along. There were claims of course, some companies stated in their marketing campaigns that their product can correct any and all mistakes. But these claims never turned out to be true. This solidifies the understanding of one simple fact: the issue exists and Grammarly is the prime solution.

There were several attempts to solve the overall problem besides Grammarly itself. The contextual spell-checker, for example: it analyzes a text and corrects orthographic errors. Some services deal specifically with academic writing and the standardization of texts similar to TOEFL and GRE. This relates to essays analyzed by three parties: two humans and one automated system. There’s Microsoft, of course, which has been trying to solve the dilemma of grammar checks from the 1990s to the early 2000s. A large team was involved on their side and their task was to implement the functionality that Grammarly currently has into Word. The team was unsuccessful and eventually ceased to exist.

Competition breeds excellence. It’s great being a trailblazer that creates new paths. It’s quite possible that we will soon see some real competitors. We’re ready for this shift and embrace the challenge.

The reason that there’s no real competition so far is because the issue of text quality improvement is a complex one. It’s technologically difficult and you can’t solve it in one fell swoop. We needed a considerable amount of time to establish a world-class R&D team. It’s currently divided between Kyiv and San Francisco.

There’s also a serious interface-related problem. Microsoft wasn’t able to solve specifically the issue of the UI element. How do you communicate the intricacies of grammar checking to the users? We, on the other hand, are constantly experimenting and have already created a considerable number of innovations in this area.

The team and the search for talents

We have two main offices: one is located in Kyiv and one in San Francisco. The California office is still quite young. Our CEO moved there four years ago. In its infancy, it had only two-three employees. All the engineering drive stemmed from Ukraine in those days and this is still the case. However, the idea was to eventually depart from the development in Ukraine, front office in the U.S. model. We wanted to establish a unified corporate culture in both locations. We wanted the energy and the feeling of ownership to be present both in San Francisco and in Kyiv.

That was a difficult task simply due to physical distance, but we were still quite determined to try. We had the opportunity (which we seized) and there were no investors to tell us: You’re all going to San Francisco right away. What’s important is that we were successful in the end. Today, it doesn’t matter in which office a specific team member is located. It’s a shared vision.

Overall, I have to say that the understanding of the team’s importance came to me through iteration. Nowadays, I’m aware of the fact that if you get a venture investment in San Francisco or enter Y Combinator, you’re told: You need a team. We needed quite a bit of time to realize the importance of this factor. It’s probably the biggest challenge Grammarly faces now. We’re already operating on a global level, which means the company has correspondingly large obstacles to overcome. Consequently, the people that work with us need to be world-class specialists as well.

There’s a crazy race for acquiring talented employees in San Francisco. But it also stimulates us and constantly provides motivation. When we compare our business to other product-based companies in Ukraine or even Western Europe, there’s a feeling that we have some respectable progress and growth. But when you’re in San Francisco, you’re operating alongside true giants of the tech industry. This gives perspective and an understanding of the long path that lies ahead.

The competition for engineering talents in Ukraine is obviously less intense. Our country still has good schools and a number of universities that provide high-quality fundamental skills and knowledge. Logically, there’s quite a lot of young people with the right level of education that can become world-class engineers in time. Hungry talents that are eager to enter the global market can be found here as well. Though there’s much less of them overall, of course. People like that soon realize that the ceiling for their ambition is quite low if they continue to work in Ukrainian product companies. As soon as you reach it it’s time to leave. We’re doing everything in our power to make Grammarly into a platform where global ambitions can be reached without leaving Ukraine.

The fight for talents is an interesting learning experience in and of itself. We have about 20 engineers working in San Francisco at the moment. Some of them moved from Ukraine, some were hired in the U.S. But the core team that develops the Grammarly software is located in Ukraine.

The company employs nearly 80 full-time team members in Kyiv and 35 in San Francisco. We also have around 20-25 contractors that work a full nine-to-five but aren’t in our permanent staff. They’re mostly from the U.S.

The product culture of Ukrainian engineers

The model that we follow looks like this: after a refined selection process in Ukraine, we include the new engineers into our team and do our utmost to bring them to a new professional, technological and cultural level in the startup’s framework.

We invest a considerable amount into working with consultants and mentors in San Francisco. Do you remember the Fail Whale that constantly popped up on Twitter? The engineer that worked there in the initial team and helped with the scaling of the service made his fortune by the age of 35 but still consults with a few companies that he personally likes. We’re one of them. He’s so enthusiastic about the problems that we’re solving that he consults even our Kyiv-based engineers. They openly communicate with him, ask questions and he helps them reach new professional heights. The vice-president of Airbnb is also one of our advisers.

There aren’t many people like that available for consultations, but we do everything we can to provide our Ukrainian team with mentorship and guidance from Silicon Valley. It’s fascinating to watch how our people grow, to see their skills and mentality compared to the time when they just arrived at the company, armed with considerable technical skills and potential. It’s very rewarding to observe the progress and new heights attained by our team. The people working in our Kyiv office are already Silicon Valley-level engineers in terms of thinking and culture.

The stark difference is obvious specifically in the rhythm, the drive, the hunger, a desire to create something that will change the world. These things are in the air in San Francisco. This is why people go there, despite the sky-high prices. We’re demonstrating that this can be replicated in Kyiv.

Mentorship

It’s possible that the desire to engage high-class mentors is also a side-effect of an inferiority complex (in a positive sense) in Max (another cofounder of Grammarly) and me. We love to learn new things and are aware there are always aspects of life and business that we don’t yet know about.

Grammarly is our second business. MyDropbox was the first one, we worked on it from 2004 to 2007 and eventually sold it. It was built on a more traditional model: the development office was located in Kyiv and we operated from Toronto. Even though it was a very successful exit for us (we had no startup experience at the time), we had no idea where the sphere of our knowledge began and ended. We simply moved full steam ahead through brick walls. The result was a shift from we don’t know what exactly we don’t know to we know there’s still a lot to learn.

We realized that the brick walls on the higher levels of business were even more solid. They can’t be charged through. They can only be overcome by surrounding yourself with people that know more than you do. From the very inception of Grammarly, we had no illusions about doing everything ourselves. I’m proud to say that now I can point to any person in the company and say that he/she is smarter than I am.

Changing the business model

Approximately two years ago we moved from a premium model to a freemium one. The process took nearly an entire year, but it gave us a huge burst of energy. During our initial period, you needed an activation number to get access to a seven-day trial. This paywall was in place from the start. The user’s need for Grammarly’s functions had to be pretty high to pass that obstacle.

Only 2-3% (rarely 5%) of users buy the product in a premium model scenario. This meant that 95% of our potential customers simply left after taking their first look at Grammarly. In a freemium model, 100% of the users constitute the target audience and many of them become returning clients after using the service even once.

We never get complacent: we’re constantly experimenting with the balance between free and paid features. Our goal is to eventually move the paywall as far as possible to allow the maximum amount of functions to be free. Simultaneously, we plan to make the premium version more and more powerful for our professional users.

This approach is already showing positive results. Our Chrome extension (launched a little over a year ago) already has almost 9 million active weekly users. This makes us extremely happy since it shows that people have made Grammarly their default grammar tool.

The service has a rating of 4.66 stars out of five in the Chrome Store and nearly 13 000 reviews. This borders on a platform-level record. We also have a Slack channel where the Chrome Store and Twitter reviews are directed. It’s a stream of positive feedback that serves as a huge inspiration. After the switch to freemium, the amount of Grammarly users has grown exponentially. The product energy, the user energy empowered the team in a very obvious way.

We can’t disclose the exact figures yet, but the number of installations has reached tens of millions.

Speaking of our financial results, we regard them as a tool and not our end goal. It’s always been a question of discipline in our worldview. That’s why we’ve been able to reach this level of development without any outside investments. There are precious few companies in San Francisco that can say the same.

The shift to freemium didn’t really affect the team growth rate. It may have made it obvious though, that we need to invest more into our interface and presence. We currently have three web browser extensions (Firefox, Chrome and Safari), two desktop applications (Mac and Windows), an Office application and a web-editor which is quite customizable for the three browsers. That adds up to nine interface systems. When we worked through a premium model, we didn’t have as much users. Now, millions of people can find the bugs in our software. This motivates us to invest more into interface development and scalability.

When we talk about tens of millions of users (the point where we are today), that’s one thing. When we talk about hundreds of millions that’s quite another scale of magnitude, for which we have to prepare.

As a result of these investments, the growth rate of the team increased in the areas of front-end and platform development, since our tasks increased in complexity.

The growth of the project

Growth is a subject I can talk about endlessly. There’s a famous Paul Graham quote: «Startup equals growth». Any growth rate below 30% isn’t considered relevant by Silicon Valley standards. If a business has been around for 10 years, that’s probably normal. For a newer project, 30% is the minimum that potential employees and investors expect. We’re developing much faster than that. And Grammarly is eight years old, we’re not that young. We’ve had to wind our way through the business world to find our product and market fit. But during the last five years, we’ve been moving into the consumer segment of the internet with concrete goals as to the number of users we want to have. If one were to compare the number of active users before the launch of our freemium model to the amount we have now, the increase can be measured in the tens of thousands of percentage points.

Grammarly is a startup and this influences many aspects of what we do: our philosophy, culture and sense of urgency. Startups should grow fast. The people that come to the company now see a comfortable office and an established product. They think that we’re probably a miniature version of Microsoft or Google. But those businesses have proven everything they needed to prove and have defended their position where needed. Grammarly isn’t up in that echelon and it’s extremely important to us that everyone within the company understands that startups need to grow constantly. Every person in the office is responsible for making his or her contribution to that growth. All of this is part of the shared platform and culture that we’re creating.

Investments

When you raise money, you have to understand what you’re going to do with it. You also need an understanding of what you might lose if you take in outside financing. That’s something about which you should be very pragmatic.

Two years ago, we took second place in the Bootstrapped Startup category of The Crunchies contest. Nerdwallet, the company that took third place, raised $102 million in a year. It had a well-functioning business model and initially they didn’t really know how they would use the external investments. Later on, they understood that their business is very dependent on SEO and they needed strong investment partners that could talk to Google if any problems arose in that area. They engaged the investors as a strategic move to have a lever related to their main operating channel. At the end of the day, Nerdwallet had a clear understanding of the why and how of their investment relationship.

Up until today, we didn’t have that understanding: where can we benefit from having a strategic investment partner and what purpose would the raised money serve? What we had was a strong sense of discipline in regards to our business model and our goals.

Any sort of fundraising takes attention and energy, more so if you have an investor on your board of directors. A lot of effort goes into preparing such meetings. Venture investing is a great model and it’s a big reason that companies like Facebook and Google exist. But this model requires very specific goals and the discipline to achieve them. You also need to evaluate what you lose in the process. We’re currently so focused on our goals that we don’t allow ourselves to be distracted by anything else, including raising investment funds.

That’s not to say we have never engaged with investors in any way. We have very good relationships with many. We’re always open for communication because we understand that the situation may change in the future.

Don’t get me wrong, I’m in no way saying that you shouldn’t attract outside financing. The core of my message here is that you should always remember to focus on your business’s goals and needs (what strategic goals are you pursuing in the fundraising process?). The experience of Brad, our CEO [Brad Hoover was the partner of the General Catalyst venture fund for six years] has been invaluable in this regard, since we, as the cofounders, have never been involved in attracting external investments. Many companies that raise money don’t even know what to do with it. This sometimes leads to disastrous results when the funds are simply directed towards fancy offices and higher salaries. The money is exhausted with no positive results. Nothing good can come out of that.

Investments are an amazing resource, and you should have a way to attain them, but they aren’t the end goal.

I don’t know how venture capitalists work in Ukraine, but in Silicon Valley they’re very active: they get one-two seats on the board of directors, depending on the investment round. In essence, they are the external managers of the company. Not all investors are equally good for the business. Some of them might not even understand what the company does and may lead it into a dead end. Â Or consider this scenario: the company’s growth slows for a bit, the managers may believe it’s a temporary situation, but the investors may panic and replace the managers. It all depends on what kind of investors you engage and on what stage of your development. When you handle all the responsibility and the fate of your company is in your hands, it simplifies the decision-making process.