(Bloomberg) -- UiPath Inc., a software maker that helps companies automate repetitive tasks like data entry, is preparing a U.S. initial public offering next year, its chief executive officer said, after closing a funding round valuing it at $10.2 billion.
The financing, which the company announced in a statement, confirmed a Bloomberg News report last month and bumps up UiPath’s valuation from $7 billion last year.
All the remote work done during the pandemic has increased the need for automation, with the U.S. turning into UiPath’s fastest growing market, Chief Executive Officer Daniel Dines said in an interview from Bucharest on Monday.
The company is now speeding up its plans for an initial public offering in the U.S. in light of Covid-19.
“Definitely next year, in case the market conditions will be okay for an IPO, we are ready to take the step,” Dines said, adding it’s unclear whether the company is aiming for an IPO in the first or second half of 2021.
The New York-based company raised $225 million in a round led by hedge fund Alkeon Capital, with participation from venture capital firm Accel, Sequoia Capital, Coatue Management, Tiger Global Management LLC, Tencent Holdings Ltd. and others. It has now raised than $1.2 billion to date, the company said.
The round is part of strategic planning for UiPath’s expansion, including through potential acquisitions that can broaden the company’s technological reach and more investment in engineering.
“We are on the verge of becoming free cash-flow positive very soon, maybe even starting with this quarter, so we don’t need the money from an operational perspective. It was a strategic fundraise,” Dines said.
The company said it has over $400 million in annual recurring revenue, a metric that measures its predictable revenue from subscriptions and returning customers.
Investors are enthusiastic about the company because of its strong revenue growth, said Carl Eschenbach, a UiPath board member and partner at Sequoia Capital. Changes in the global business climate this year have been a boon for UiPath, he said.
UiPath works with a range of businesses to reduce mundane tasks. It helps banks with loan processing and hospitals with data entry. Sometimes this results in the elimination of low-skilled jobs.
Rich Wong, an UiPath board member at Accel, acknowledged some jobs would be displaced by automation.
“But as these companies run more efficiently, it will allow them to create jobs in other ways,” Wong said.
UiPath’s main competitors are privately-held Automation Anywhere Inc. and publicly-traded Blue Prism Group Plc. A smaller U.K.-based competitor, Softomotive Ltd., was acquired by Microsoft Corp. in May.
(Updates with comments from UiPath CEO starting from first paragraph.)
For more articles like this, please visit us at bloomberg.com
Subscribe now to stay ahead with the most trusted business news source.
©2020 Bloomberg L.P.