Romanian software robot developer UiPath announces NYSE IPO

Romanian software robot developer UiPath announces NYSE IPO
By Iulian Ernst in Bucharest March 29, 2021

Bucharest-born UiPath, the leader in the global robotic process automation (RPA) industry, has filed documentation for an initial public offering (IPO) on the New York Stock Exchange (NYSE).

The latest financing round, in February, put the company's value at $35bn — three times more than in a prior round, last July — and the issue is likely to be one of the largest on the NYSE this year. 

"We had plans for listing on the stock exchange before the coronavirus [COVID-19] pandemic, but we made a promise that we would apply for the IPO only when we were profitable. Now, the pandemic has accelerated our plans, we are in a very solid financial situation and we clearly plan to apply for the IPO next year,” Daniel Dines, one of the company’s founders, said last July.

The company mentioned a $1bn target to be raised by the issue of common Share A, but the documents filed with the SEC do not mention more specific details such as the target price, therefore, the final sum might be larger.

The growth potential of the company stems from the size of the market that is expanding as new business areas become accessible to automation by the development of new technologies that enhance RPA instruments: artificial intelligence and machine learning.

According to UiPath's own analysis and data from IDC, the global RPA market is estimated at over $60bn, but its boundaries are extending along with the technologies behind it.

Friday's filing revealed that UiPath's revenues grew by 81% to $607.6mn in the year to January 2021, while net losses narrowed from $519.9mn to $92.4mn.

The pandemic "may have accelerated the adoption of automation" as more companies were forced to work remotely, UiPath said.

The enterprise RPA software company was founded by Romanian entrepreneurs Dines and Marius Tirca in 2015.

The company faced a difficult situation in 2018-2019 when it announced it would lay off about 400 employees (one in eight of the employees at that time) as part of a global process of “reorganising its functions”.

After international media reports about the layoffs, Dines confirmed the reorganisation in a blog post on October 24, 2019. “Over the last few weeks, I have asked our teams to dive deeper into their operations. In some cases, we identified opportunities to streamline, such as combining our partner sales and direct sales teams in every region,” he wrote. “We are also shifting investments from back-office to customer-facing operations. While this is largely about improving our customer experience, it is also about improving efficiency; a necessary step as we mature our business.”

The company blamed the problem on “a lack of oversight and technical competence and experience within our finance department to identify such errors” and said the issue had been “remediated”.

As part of the reorganisation, CFO Marie Myers left the company after she joined it at the beginning of the same year.

At that time, there were reports of heavy spending by UiPath. Romanian daily Ziarul Financiar quotes internal sources saying that the company was spending cash at a speed that is "significantly higher than at any other RPA company”.