Romania’s first $1bn firm may go public

UiPath, a software maker valued last year at $7 billion (Dh25.7bn), is getting closer to an initial public offering after helping some of the biggest companies in the US automate routine processes.

Armed with last year’s $568 million funding round that gave the New York company its multibillion dollar valuation, co-founder and chief executive Daniel Dines expects more growth on the cards. The bourse entry may take place as soon as early next year, depending on market conditions and strategic decisions.

“We just started our growth journey in 2016 and if you look at the average age of a company to do an IPO it’s probably 7 years, so there’s” no reason to hurry, Mr Dines said.

“You have to become a public company at some point to allow your employees to get more liquidity, give them stock options. We’re almost there,” he said.

Founded in Romania in 2005 as DeskOver and renamed in 2015, UiPath’s client base includes the CIA, the US Navy, McDonald’s, Duracell and Swiss Re. The company had $360m in annual recurring revenue last year and it attracted funding from investors such as Sequoia Capital, CapitalG, Wellington Management, Sands Capital and others.

UiPath’s software performs low-skilled and repetitive tasks once outsourced to humans in cheaper-wage countries, via “robotic process automation”, or RPA. Examples include the processing of applications for jobs, pensions or handling student data at universities.

UiPath, which became Romania’s first unicorn in 2018, competes with other software vendors such as Blue Prism Group, Kofax, and Automation Anywhere. Mr Dines, who ruled out acquisitions in the near future, didn’t give financial details on UiPath’s potential IPO.

“We’ve seen increased competition, even Microsoft said they will come with an RPA solution,” Mr Dines said. “This is a great validation for the industry.”

One key area to watch is the use of UiPath to help hospitals fighting the coronavirus to avoid backlogs and speed up diagnosis, according to Mr Dines.

“RPA has become a really big and established sector and many companies have plans to implement it.”

“Even though UiPath technically can do an IPO, I think they do not have to do that. They already got a huge amount – $1bn – in venture funding and do not have to get their hands tied up in the capital market. The only RPA company that went IPO is Blue Prism, which wanted to issue additional shares to cover its operating losses last year but struggled to get shareholder approvals,” said Kathy Gao, a BloombergNEF analyst focused on the digital industry