UiPath raises $30M as battle for enterprise AI heats up
(Bloomberg) -- UiPath, a New York-based company that uses computer-vision to automate repetitive business processes involving software, has raised $30 million to help expand globally.
The move comes as companies increasingly look to artificial intelligence to solve the sorts of routine tasks, such as checking invoices and inputting data from human resource forms into databases, that they once outsourced to low-cost human contractors.
The London office of venture capital firm Accel lead the investment round. Accel, which did well backing consumer-facing startups and companies building market-place business models in Europe over the past decade, has increasingly shifted to investments in enterprise software startups, many of them employing some form of machine learning or artificial intelligence.
Earlybird Venture Capital, Credo Ventures and Seedcamp also participated in the funding round.
UiPath’s software uses computer-vision -- a branch of artificial intelligence that involves the extraction, analysis and understanding of visual information in images -- to observe a set of tasks being performed on a user’s machine. It can then replicate these tasks automatically, a bit like the way macros work in Microsoft Excel. The difference is that UiPath’s software, unlike most macros, can carry out tasks across any software the business is using. In addition, users can train the tool with a set of rules or steps for analyzing the data it is handling. For instance, it could look up data from an SAP system, check if it meets certain conditions, and then input it into a Salesforce database.
One big advantage of such software over humans, is that they follow the same steps and rules exactly every time, without getting tired, making errors or skipping procedures.
"From a compliance perspective it makes a lot of sense because the software will log every step and if you need to go back and audit what happened you can," Luciana Lixandru, the Accel partner who led the investment in UiPath, said in an interview. "That means this can work well in highly-regulated industries like finance, health-care and insurance."
UiPath says that it has 200 customers, including Lufthansa, Generali, Telenor and Dong Energy. It also has partnerships with consulting firms Deloitte and Capgemini, which often recommend its products to their clients.
The market for what is known as robotic process automation software is expected to reach $8.75 billion annually by 2024, up from about $125 million in 2015, tech research firm Grand View Research wrote in an October 2016 report. Grand View estimated that these software solutions are, on average, 60 percent cheaper than using humans to perform the same tasks and cost 30 percent less than using contractors in low-paid countries, such as India.
Software like UiPath is increasingly threatening large business process outsourcing firms like Cognizant, Infosys and Tata Consultancy Services, which have announced layoffs as customers have increasingly turn to automation and software over human contractors.
With the $30 million new investment, UiPath said it will be adding more "cognitive capabilities" to its product, such as natural-language processing and document sorting, so that it can handle both structured and unstructured data.
It will also hire within its sales team to promote its products globally, Lixandru said.
The company, which currently employs 150 people, was founded in 2012 in Romania and still has product development offices there. It later shifted its headquarters to New York. It also has offices in the U.K., India, Singapore and Japan.