— How did DataArt come to India, and why now, specifically?
— It’s simple: our strategic interests coincided with a new opportunity for us to begin operations in India. We feel like a global company, and we want to compete in global markets for the best projects and the best talent. Strategically, we cannot ignore the largest labor market in the IT world. At the same time, we got the opportunity to open an office here through our acquaintance with Sheetal Kale. Sheetal is an excellent partner to help us understand this new market, test it, and take our first steps in India.
Another good reason for us to be in India is that some of our clients want to work with India specifically. Our reality is that we have become multicultural, and we must be able to work systematically with varying markets. Our task is to understand and accept each other's cultural differences in order to become stronger.
— Where is DataArt now, in your point of view? What do we see ahead of us, and where are we going?
— Over the recent past, we faced unprecedented challenges: COVID, followed by explosive demand growth, followed by the war, followed by a drastic fall in demand. The Russian invasion of Ukraine is a deeply personal tragedy for many of us; 40% of our people are still in Ukraine under constant risk of shelling. The company performance over this period was outstanding: we continued uninterrupted delivery, diversified the delivery base, and provided help to our people impacted by the war and to Ukraine. The demand for software services will undoubtfully return, and we are in the best position we ever were to take advantage of the next wave of growth to become a truly global IT services company.
All crises are different. Unlike the previous ones, this time, we had no doubt that the company would survive, that most of our colleagues would stay with us, and that we would not lose our trust in each other. In terms of ruining our business, the war has been far from fateful. I'm talking about our company's stability, cash flows, etc. Our losses turned out to be much less than we would have assumed if we had known the scenario in advance. I can cautiously say that right now, we are conducting business "as usual".
Naturally, this does not negate the fact that, at the same time, thousands of our colleagues now find themselves in the most difficult personal situations and are going through the most difficult period in their lives. And, of course, we are doing everything we can to help people personally and help Ukraine as a whole.
— How are things going with growth and cash reserves?
— Our cash reserves are unusually large because we closed an investment round before the war. The company is very durable. Our frenzied growth has stopped, yet even so, we grew by 30% in 2022, despite everything. Globally, we’re growing, making money, and increasing our sustainability.
— What's happening with demand?
— We're seeing a sharp decline in demand. This is caused by several factors at the same time: the geopolitical situation, high inflation due to excess money printed during COVID, and a correction of the technology sector. Right now though, it doesn't look critical, and personally, I am optimistic. Furthermore, not only me but also the business community and the technology community in our sector in the US and UK have the same opinion as I do. Most expect the sector's recession to end in the foreseeable future. Enterprise clients digitization projects span over many years and while there is slow down with decision making, projects are still on the plate. Some projects have been reduced, but others, on the contrary, have gained momentum.
Despite the outflow of demand, we continue to do almost $50 million in new business per year and for the good portion of 2023 our revenue is flat at around $100M/quarter. The medium-term and long-term forecasts in our industry are positive.
—What key factors will Impact the future of DataArt and our colleagues?
— Falling demand is an unusual situation for us, although we have encountered it several times in the company's history. The way we behave now will directly affect how we get to the next growth stage. But we need to, firstly, reach this stage and, secondly, be prepared for it. We must run ahead of the game and not wait for the return of the good old days — the future will always be different. The period when we aren't occupied by super-rapid growth is a good time to see new opportunities and improve the foundation Look around: at new technologies, skills, qualifications, where business is moving, what is about to take off, and who will be in demand tomorrow. The clearest example is AI, which has very quickly turned into a widely demanded technology.
Right now, we are quickly developing what we need for DataArt to become a global player, paving the way to (virtually) limitless client, talent, and capital markets. On the talent market, we are learning to operate in a truly multicultural environment. For the client market, we are upgrading our account management practices and level of compliance to better serve our growing enterprise segment. For capital markets, we are improving our corporate governance structure and reporting. Above all, we are learning to be better aligned with outside realities and to balance the interests of all stakeholders.
