New computer systems company utilizes pool of talented programmers in Ukraine (02/17/02)

New computer systems company utilizes pool of talented programmers in Ukraine

SAN MATEO, Calif. - Lohika Systems Inc., a company established by a group of Silicon Valley entrepreneurs with close ties to Ukraine, announced that it has completed its Series A Round of equity financing from a premier group of private investors, raising a total of $1.25 million.

The funding will be used to expand the company's sales, customer service, and development operations in the United States and Europe. Employing computer programmers in Ukraine, Lohika provides high-quality, cost-effective outsourced software development, integration and maintenance services to the higher-education and utilities markets in the United States at significantly lower prices than internal informational technology (IT) staffs or other outsourcing vendors.

While the business climate in Ukraine continues to improve, the shortage of rewarding employment opportunities means that the best and brightest young minds in the country continue to look to the West for jobs, despite the desire of many to live in Ukraine. This has fueled a "brain drain" through emigration that hurts future economic-development prospects for Ukraine. Through its close ties to Ukraine, Lohika serves a very important social mission by providing an immediate workforce-development opportunity for workers in Ukraine. The company will provide jobs that prevent "brain drain" and promote the continual development of cutting-edge high-technology skills in Ukraine.

Lohika has established a software development center in Lviv, and is already generating revenue from a select group of customers in California.

Lohika was co-founded by Nataliya Riabokon, Volodymyr Riabokon and Lonhyn Jasinskyj.

Ms. Riabokon, Lohika's chief executive officer, has several years of business experience with Ernst & Young. She is a native of Boryslav, Ukraine, and was the first woman from Ukraine to graduate with an M.B.A. degree from Stanford Business School, the most selective business school in the world.

Mr. Riabokon, Lohika's president and chief operating officer, has eight years of investment-banking and business-development experience with JP Morgan, Chase, the International Finance Corp., and NHK.

Mr. Jasinskyj, Lohika's chief technical officer, has 16 years of software-development and management experience with a variety of companies in California, including NASA.

Lohika's outsourcing services combine high-level on-site project management in the United States with a large pool of highly skilled, cost-effective professional programming talent in Ukraine. Ukraine is home to several major software development centers and is now successfully competing with India for outsourced IT services.

"Ukrainian programmers usually have advanced degrees, a solid knowledge of a variety of computer technologies, and extensive experience in complex projects in the military and scientific fields," said Gene Shklar, a member of Lohika's board of directors. "The company is well-positioned to spearhead the early trend to take advantage of this rich pool of programming talent in Ukraine," he explained

External members of Lohika's Board of Directors include Mr. Shklar, a founding employee and former executive of Keynote Systems (Nasdaq:KEYN) and Siebel Systems (Nasdaq:SEBL); Adrian Slywotzky, vice-president and member of the board of directors of Mercer Management Consulting, a global strategy consulting firm (one of the Marsh and McLennan Companies [NYSE:MMC]), and the author of several books on business strategy, profitability and competition; and Lore Harp McGovern, a Silicon Valley entrepreneur, active international venture investor, director of numerous startups and director of the McGovern Institute for Brain Research at the Massachusetts Institute of Technology.

For more information about Lohika Systems, visit the company's website at www.lohika.com.

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