UiPath: Everything Breaks When You Go Into Hypergrowth Mode

My name is Luciana Alexandru. I am a partner at Excel, the global venture capital fund. And I'm very happy to be here with one of these mythical creatures that people were talking about earlier. I'm here with Bobby Patrick, the chief marketing officer of UiPath. And Excel led UiPath Series A about a year and a half ago.

Right.

And the series V about half a year ago. And it has been quite a journey. The company scaled from 100 people to 800 last. I know, but it changes every day.

A thousand next week.

Okay, 1,000 next week. They are active in 16 offices and I would say they're on fire. So I'm really thrilled to hear a bit more of the story together with the audience. So, Bobby, tell us a little bit about UiPath.

Yeah, we're in the business of robots. Software, robots, an industry. There was a great presentation earlier. You all probably heard with the category awareness, category urgency. And I'd add one more company urgency. We're in a category that a year ago, nobody really heard of called RPA or Robotic Process Automation. Today, every single Global 2000 company has somebody thinking about RPA. And next year, every division within a Global 2000 company will think about RPA. And. And these are robots that sit next to a human and they do the work that a human does continuously, over and over and over. And this is in all parts of your life. And what's exciting about this is we talk about that what we do is we help humans be more creative. That's what you were born to do. That our robots do the work that we hate. I can give you marketing examples of how robots are sitting on my laptop and in the cloud doing work for us that we hate, doing the work that is done in a contact center at an airline, or a work that's done in your finance business. You know, we tell every CFO that if you have an employee in finance that's not doing data driven analytics, that's what a robot should be doing and that's how big the opportunity is. And our company grew from. The numbers are huge. But we'll do. We've already done more than all of last year, Luciana. We will do four and a half times what we did last year and it will be a half a billion dollar ARR company in about 18 months.

And last year the growth was also meaningful. I think we shared the numbers publicly. It was about eight times on numbers that are already significant. So let's talk a little bit more about the topic of this panel. What is your philosophy around Growth, if you have one. Unless you just go every day and try to do your best and survive.

Yes, we have a different philosophy than the prior Meltwater one. I think part of it is market timing. So Meltwater started in 2001, as you heard, and kind of grew consistently over time. And they used their cash well. We also started back in early 2000s, but spent the better of 12 years perfecting a technology called Computer Vision before the market really was there, the market now called rpa, which is the fastest path to using AI in a company now. And so what we did, though, if you look at how the hockey stick works, is about a year and a half ago when the Series A started, that's when the world shifted a bit. The technology was perfected, a business user could build their own robot, and things really took off. And so we took the Series A. Interesting enough, the first executive hired by, thanks to sales coaching actually was marketing, which I. When I was first met Luciana, we didn't have executive teams really, outside of the founders. And, you know, for her to say how important marketing, you know, big M marketing, not Little M marketing, was meant a whole lot about what we were going to undertake here. We had to build the category, we had to drive the urgency. And then in our company then, we had to act with a massive sense of urgency about how fast this market was to going, going to materialize. So growth for us is about massive scaling and hiring. You know, we went from two offices probably a year ago and three employees in the U.S. for example, to a thousand employees, 150 in the U.S. now and 16 offices worldwide, all within 18 months. We raised 180 million. And we really haven't touched the cash either.

You know, I had been telling people that the inflection point came when Xcel invested, but I guess it was market and product and all that good stuff. I'm joking. How do you set milestones when you're growing so fast? And I mean mainly internally, but even how you manage your board and people like me, do you set higher targets so that the team is overly incentivized? I have also heard the opposite side of the spectrum where companies will set a slightly lower target in order for the team to be really excited. How do you guys think about it?

It's really fascinating. Our founder, Daniel Dines, an amazing, amazing guy who lives and breathes this with passion. He actually sets the targets extremely high and raises them every quarter because it's a sense of urgency that he's driving right now. It's not, you know, and he's right though, right? It's really weird. We raised, since I've been with the company now 10 months, the numbers go up. You know, we're adding five and a half customers a day. These are all large Enterprises. We added 0.8 when I joined. We have 21,000 inbound leads that come in now every month. 800 of them are hot. So what we do is kind of look at all those metrics and our hope goal is that every one of them continues to show this. There's no plateauing. And so we have all these numbers we look at. But I think in some ways we're a little short term focused then because we worry about the fact that every Global 2000 company right now should be thinking about deploying digital workers and building a digital workforce. And we want to be the one in there and we want to be the one. You know, we think we have a superior product and we want to be the one that. So, so there's a sense of urgency. And so I think we, we, we push ourselves.

Okay, so set milestones actually higher and ideally achieve them.

And so far you have, you wouldn't believe the milestones. When you, like when I first heard them, you, I wouldn't have believed. Right, right. And, and you had to actually live this to realize that this is one of those examples of a very, very unique market opportunity. A shift, a way shift in how businesses work. This is the future of work. Every single person in here will have their own digital worker here in the next three years. You may not realize it yet, but it's, it's in every part of the business and it's dramatic. Like any fast growing startup in here and you're hiring an HR to handle your employee hiring. You could probably have a robot do 88% faster, better for your employee and not have to hire as fast. If you're handling multiple invoices from different customers, they come in different formats. You know, you can keep hiring more finance people or you can have robots augment your finance people. They enjoy their job better and have better satisfaction actually, and you have a much more productive organization. This is, it's mind blowing the degree to which this shift is happening. And when you have a ship like this, you've got to, you've got to just go all in.

So if I had to summarize, you believe that the opportunity is now, you believe that the opportunity is massive and therefore you're going to get to grab the opportunity as fast as possible.

Yeah, that's right. And so you know, we went into Japan. I don't know how many of you have any operations in Japan, but here's an easy example. You don't typically go into Japan and drive huge growth fast, right? We moved into Japan in March of last year. We have 270 customers. We've hosted 2,000 businesses at our own events there. We're in almost every large organization and Toyota and the banks and others in Japan and it took us having a very like we had to go. We make an investment, hire the right person, an ex Barclays cio, very senior in this case, very senior in this case. He has a 90 person organization and now RPA in the, in just like Japan. RPA is a societal discussion. RPA has two big benefits to the, to, to Japan. One is it addresses an aging population and the workforce impacts there. They call it decaying population, which I don't use, but they call it that. And two, suicide. So robots actually reduce the amount of work from 120 hours on average at a Japanese company to 80 hours a week, which is still a lot, but that every market's a little bit different. But if we didn't go all in on Japan and we went in kind of slowly or we said ah, too hard, we would have missed out on a massive opportunity. And that exists in public sector here in France, public sector in the uk, Federal government in the US it exists really everywhere, simultaneously.

And if you. Japan is one great example. As I mentioned earlier, you guys expanded from two offices to 16. Is that the right number now? Sixteen across Europe, Asia and the U.S. i believe that we have a lot of European entrepreneurs here. Is there any advice in terms of when is the right time to find your next market and is it always the US in terms of the first step after Europe, in this case it sounds like Asia was quite lucrative as well.

We're also different than in the earlier discussion which tried to influence everybody here to move to San Francisco. We actually think it's about where the customers are when it comes to our kind of sales and customer success and then where our product development center should be. So we have a product development center in Bucharest, in India and in Seattle. We have, then I have a lead development team in Austin, Texas and in Bucharest we have the salespeople and our customer success in offices all around, kind of local and closer to customers. So we actually think about, you know, where are, where are the customers and you know, where do we need to be to be able to serve those customers. So when Daniel moved the company to New York, it was really about getting closer to the biggest market of large companies that were going to become the biggest opportunity. It's not that they're all there. They're not here or in Japan. It's just that he knew we needed to be there in a serious way, right? So we moved our company's headquarters to to New York City. But right now we think about the markets in terms of establishing an office primarily for local kind of sales and customer success. We opened Toronto and Sao Paulo in two weeks. We just opened Seoul. And you've got to be there and you got to be there in a legitimate way, right? You can't really serve the Korean market or the Japanese market or market in Portuguese, in Brazil without really being there in a serious way. It's no different than in like federal government. We've been in the US federal government for five months with office and now we have robots running at most major agencies. NASA and others, they're big success stories. And this is all within six months.

One of the things that comes to mind when you mention Brazil and the US and Europe is culture and how you UiPath really was active in one city as of only two years ago. And yet all the offices I've been to give me the same impression. People are running in the same direction. They're very mission driven. They know exactly what the purpose is. So I would actually say that you guys have done a very good job of scaling culture across many cities and many countries that are very different from each other. Was it organic?

It starts.

Are there any tools that you use?

You know, every all hands meeting which we have multiple a month. Humility starts the conversation, right? We don't hire arrogance. In fact, our CEO will fire an arrogant person tomorrow, right? You know, we don't excuse the word hire assholes, right? It's very, very important to us, right? Any one employee, and you're required to have at least three interviews can say no. And there's no exceptions asked. Every employee goes through IQ tests and not to look for the highest iq, but just to get a feeling of how they answer questions and go through thought processes. You know, this is. We have some 18,000 people active in our job site right now worldwide, right? And so we pride ourselves in hiding hiring people that fit. This is no work life balance company. We're honest about it, right? You've got to believe in this unique opportunity. And so we've managed interestingly enough, every our Paris office is four blocks from here. And yesterday they were all feel the same way. We've really managed to keep that one thing I didn't mention earlier that is important in a go to market perspective, which, which we do differently than our competitors is in addition to building out the direct. And that touch is we do foster community online. We do think about, we do things, we think about. So we have a term we want to democratize rpa, right? Meaning if you're a small business and if you're under a million in revenue, you can use robots for free right now, this weekend, you could build them and make your life more productive. Right. You know, if you're a university and you use our technology and courses in business school now, which a number are doing, you can use our software for free. You know, we think about things, about how do we make this and take this. And that's part of making the humility, part of being who we are real. Right. And so it took doing those kind of things, thinking about an online community you can get certified with our software for in fact, over a hundred thousand people have gone through it in just 11 months. It's called Academy. And you can add people, add them to their LinkedIn profile, their certifications, and there's different ones based on job roles and it's all free. So I would be remiss if I didn't say that those things are also equally important to the mix of how we scale worldwide.

And the fascinating thing here is that you, you hire slow and fast at the same time. So you hire slowly because it takes. Anyone can veto or one person can veto a hire. And you test for various things, not just iq. As you said, being humble is key. And I can say that that's something I've witnessed and something I felt whenever I met someone in the company. But at the same time, you guys are adding what, 100 people a month now? It changes and grows every month.

It's almost 2,000 people.

How do you do that? Is that just about spreading the pipeline as wide as possible? Just hiring a big HR team or processes? How do you do that?

Referrals are still the best way to get the best people. So we hire. I have an employee branding person now who came from LinkedIn and we spend a lot of time on employee branding of who we're hiring and who we're going after on social media. We do have a network of recruiters, so I don't think recruiters, you know, I don't really want someone out there that's, you know, been looking for a job for a year. Right. We want to actually find people who aren't really Looking right. So I think we're, we're deliberate like that and it's. But it's something we talk about every day. Hiring is the number one challenge. Hiring, you know, great people. We also care about what the right call it forced attrition should be. Well how do you also understand what is not working right, perhaps and maybe it was a wrong fit and dealing with that too fairly quickly. And so these are probably the first things we talk about in every, you know, operational exec meeting every week. Before we talk about numbers.

Let'S talk a little bit about some of the more boring part of scaling. Growth is intoxicating, right? It's, it's almost like a drug. Everyone is really excited. Everyone is running in the same direction. How about putting the right infrastructure and processes in place while you're growing so fast? Is that a priority or do you feel that since the market opportunities now it's just a land grab and the rest will be figured out?

Yeah, I think, you know, if you looked back and said what have we not done as well? Right. We scale the front end of the business fast. You know, so marketing, marketing, sales, community, all these things are driving that. You know, every month our inbound activity is up 15, 20%. Right. So that's. We do outbound too like the earlier discussions, but I think so we have to address that. But the back end of the business, you know, finance and accounting and legal and you know, didn't invest. So we have to ask ourselves right now. So in every meeting we talk operationally about our investments right now in marketing, for example, our web martech platforms should be built for a company of 400 million in revenue today because we're going to get there so fast. If we're not thinking that way, we're going to be left with systems that are not, you know, we're never. And so I think in some ways we're playing catch up. It feels like always in the back office because we, you know, fortunately with SAS we use a whole variety of great tools. I love personally Insight Squared on top of Salesforce. I use it every morning, you know. And you know, we also use robots though too. You know, I have a robot in the morning that goes on to Google Trends and does top four competitors and does screen scrapes it and sends it to me. Right. So I don't. It's two minutes a day I save. But add that up and it's, it's a great thing. Right. So it's it. But you know, how do you, how do you scale? I Mean, it's something we worry about, we worry about every day. And you know, last thing you want to do is a big migration of systems, right? And this is, you know, it's, you know, going from one CMS or marketing automation platform and moving to another is not anything that anyone wants to do. But if we don't think about how do you serve and be a billion dollar business in a couple of years now, we're going to be hurting then. So I, it's, you've got to put yourself. So the hardest part for the employees then if you don't have experience is what does that look like when you're a billion dollar company and you've got, you know, five times the salespeople who are, you know, needing use cases and needing materials and needing events and you know, we'll host almost 11,000 people at UiPath events this year alone, right up from 1,000 last year. How do you pull that off even, right? And how do you do that in a way and knowing that next year will probably be 25,000. So you have to sit down and force yourself to think about what do I do now so that I'm ready for 6 months, 12 months and 18 months. It's a really hard thing to break, to really think through.

So the next question I ask myself often, so I don't know what your answer will be and I'm very curious if you were to take a step back and try to summarize this evolution and this fast growth for the past couple of years and attribute it to one thing. And it's never just one thing. What is UiPath obsessed with getting right? Is there one thing where you feel that you just cannot fail or make mistakes?

Yeah, I think we are obsessed with making it really easy for the non technical engineering IT person to build and automate their processes and build robots because it is so stressed and engineering projects are heavy, that if we can make it really easy, really easy, that everybody on every desktop can just like Microsoft Office can automate something you do every day in a repetitive way so you tomorrow don't have to do it anymore. That's kind of game changing, right? And there are two big breakthroughs. One was the computer vision that we built so that the robot has eyes like a person looking at a screen with perfect, perfect accuracy across multiple applications. The other one was the ease with like a Visio like tool I can automate a complex process and have a robot run for me. And I can do that in hours, you know, or days for a complex process. And what's amazing about this technology, unlike most B2B software technologies I've ever seen, is that the implementations are fairly easy. I mean, Accenture and those guys have built practices around them. The outcomes are immediate. Right, Meaning you, the outcomes are immediate. You get productivity outcomes. And the payback period on the entire automation project is six to nine months. These are self funding, right. And then it's transformational for a company because you're serving your customers you know, extraordinarily better. Contact centers for airlines can respond to an email. Instead of 48 hours with a smart response in four minutes, it's still, you know, Michelle the person, Michelle the robot. It's. This is, this is, this is the digital transformation we've talked about, Luciana, for 10 years in this industry finally made easy.

So really product and specifically ease of usability. Okay.

Yeah.

The last few years have been a whirlwind. What can we expect in the next few years from UiPath?

So I think, I think what's interesting is, were some AI terms earlier thrown around about AI. AI is kind of this. The CIO of United Health Group said at a dinner that he will not allow anyone in his, in his team to say the words AI or machine learning in a sentence if they can't say ROI in the same year. Right. So what we're learning though in the business of digital workers that what we do is that we're actually becoming the fastest path to AI. So there's an exposed API. So if you're an AI startup here and you have some expertise, say in insurance and you have some machine learning algorithms, you know, and you've got one or two great customers, but you really want to get to all these insurance insurance companies. What we do is becoming the path for your model to a business operation at an insurance company. So we'll, we'll have nine of the top 10 insurance companies as customers. Their automations run through our platform means their business operations run through our platform. You apply your machine learning and voila, you've turned a process from rules based to experience based. Right? You've begun this transformation. This, this ability to make a pro, not just go digital to make the process smarter is probably our next big wave in the next two years. And our philosophy is not to be an AI company but be, be the route to market for every AI companies, which is why Google invested in us too.

It all goes to back to product. Right? And that's something I love about UiPath philosophy.

Great product.

Thank you so much, Bobby. And thank you so much for having us.

Thank you very much.