UiPath – A Cinderella Story

an article written by Cem Sertoglu, an entrepreneur and venture capital investor, focused on technology ventures in Turkey and CEE since 2006. He is currently a Partner at Earlybird Venture Capital in Istanbul.

You have probably heard it by now: our portfolio company UiPath rang the bell at NYSE last week at what became the largest IPO for a Europe-born technology company, with a $36bn market cap after the first day of trading.  

The RPA leader’s journey is unprecedented. After my partner, Dan Lupu, met UiPath (then called DeskOver) CEO Daniel Dines in 2014, we had our first meeting with him in July 2014 and were blown away with the technology vision, and Daniel’s passion for and immersion in his product. It took a while for the seed round to come together, where we at Earlybird Digital East led the 2015 round with a $1m investment and partnered with two co-investors, after having offered the opportunity with many others who did not share our enthusiasm for Daniel’s vision. In the following two years, while UiPath focused on their product roadmap, we looked to help them secure a lead investor for their upcoming Series A round, which finally came together in April 2017. Along the way, we had to bridge the company through a convertible round in 2016 to make sure they did not have to pull their foot off the gas pedal.

2018 was the year where the market started to appreciate the promise UiPath represented. The company became a unicorn early in the year and emerged as the lead contender to take global leadership of the RPA market, which analysts all started to agree, looked like a giant category in the making. Along the way, the company grew its ARR from $1m to $100m in 21 months, a pace never seen before in enterprise software, and taking this trajectory to $600m in ARR today.

As investors realized that there may be high quality ventures in Emerging Europe, we were noticing another new dynamic in action: For the first time, a company hailing from Romania was vying for global leadership in a major category, and executing a global growth strategy, with revenues spread out quite evenly around the world. A group of Eastern European engineers was beating its US- and UK-rooted, better-funded, competitors.

To provide some context, the stereotype of the Eastern European techie was that of a hacker. Teams lacked the polish and presentation skills that you’d expect to find in a team in Silicon Valley, London or Berlin. To illustrate, this was the shabby UiPath office building in Bucharest when we met them.

At a tech conference, the CEO of a western competitor called the UiPath team, “Bums”. UiPath rallied around this comment, printing t-shirts that featured the team dressed up as bums, with Daniel as the Chief Bum. This is the kind of drive – or maybe we should call it a “chip on the shoulder” – that we see frequently in founder teams in our region, and which we love to back. We know each startup is a miracle, beating enormous odds stacked up against them, and these miracles only happen when companies are fueled by this kind of drive.

The UiPath IPO is another milestone on the company’s journey. We are fortunate and proud to have contributed and grateful for the experience. We hope to convey our learnings to the next generation of founders from Emerging Europe.

Most of all, we’d like to thank each and every team member at UiPath for making this Cinderella Story come true.