“We believe in Ukraine’s potential despite the war and losses caused by it,” Mykola Mykhaylov, Pracuj Ventures

At the beginning of May, the Polish fund Pracuj Ventures invested in PeopleForce, a startup that became the first Ukrainian project in the fund’s portfolio. PeopleForce develops HRM solutions for HR and recruiting processes automation. Among the startup’s clients are BMW, Ajax Systems, and Parimatch. AIN.Capital talked to the Investment Director of Pracuj Ventures, Mykola Mykhaylov, to find out why the fund chose PeopleForce and whether it has any plans to invest in other Ukrainian startups.

Pracuj Ventures interview-1
Mykola Mykhaylov, Investment Director at Pracuj Ventures. Photo — the interviewee

What projects and what markets are interesting for Pracuj Ventures? How does the fund decide what company to invest in?

Pracuj Ventures is a corporate investment fund, and Pracuj Group (a public company, WSE) is its co-owner. The group owns pracuj.pl — the biggest job classified in Poland, eRecruitment Solutions — an applicant tracking system, and robota.ua in Ukraine.

Pracuj Ventures invests in HR Tech startups focused on our domestic markets — Poland and Ukraine — where we can potentially create synergy with key partners of our group and learn from the businesses we invest in.

We also make seed investments in companies that have clients and revenues and are looking for resources to scale.

What is the fund’s average ticket size? How many deals do you have per year?

Typically it is €200,000-500,000. But in some cases, the amount can be up to €1 million. We close 2-4 deals per year — in Poland and Ukraine.

What else can your fund offer to portfolio companies, except for funding?

The main businesses of the Pracuj Group (pracuj.plrobota.ua) in Poland and Ukraine provide services for over 100,000 HR clients. Maybe it’s more than any other company.

We know the human resources business well. We know how to work with it and can assist our portfolio companies with our experience and contacts.

Why did you invest in PeopleForce?

Two factors are always key for us — the founder/team and the quality of the product. Both of them in this company surprised us positively.

Generally speaking, Andrew Cetinic, founder of PeopleForce, has a product background. And his approach is connected with his product: it works as a system, has the development potential, and can solve customers’ problems.

It is challenging to develop an all-in-one HR solution for middle-size companies at a reasonable price. And the PeopleForce team did it. We see the potential to scale up the product in other markets, including Poland, where we have a lot of experience, and our key businesses have a strong market position.

What do you think about investment risks concerning the war in Ukraine? Because most of the PeopleForce team are Ukrainians.

Yes, we know that some of PeopleForce’s clients are Ukrainian companies. But most of them are IT companies that are not as affected as in other industries. So, we expect that PeopleForce can keep its clients and grow fast after the victory of Ukraine. And the figures we get now confirm our expectations.

At the same time, after the war started, the company sped up its plans to enter foreign markets. Speaking of the actual team, we don’t see any risks here. In opposite, we see only the potential to solidify it.

What’s the deal? PeopleForce will get funding; it’s clear. What else? What will your fund get?

Generally, we don’t publish details of such deals. So I only can say that Pracuj Ventures has a minority share.

Does Pracuj Ventures have plans to invest in other Ukrainian projects?

For sure, we need to evaluate risks for every single project. But we believe in Ukraine’s potential despite the war and losses caused by it. So yes, we are looking for new investment opportunities.