Logo Header Menu

UiPath fires hundreds of employees: is the RPA market facing a crisis?

UiPath has fired 400 employees a week after it's conference in Las Vegas. But, will the RPA market suffer as a result? UiPath fires hundreds of employees: is the RPA market facing a crisis? image

EXCLUSIVE: UiPath has fired “just under 400 employees”, according to a company spokesperson.

An internal source suggests that this came as a surprise, given the fact that the leading player in the RPA market has attracted $568 million in Series D funding this year. But the insider claims that the cash burn at the company “is significantly higher than any other RPA player” and is a factor in these redundancies.

In response, a UiPath spokesperson exclusively told Information Age that “while the business has grown at an incredible rate, it’s natural that we evaluate our teams and internal investments from time to time. In this case, we have made the decision to trim back in areas that don’t align with our current business focus. This has impacted less than 400 employees globally. But even with these changes, we have 50% more employees than on January 1 2019.”

“Pushed the hype far too far”

Commenting on the news, Phil Fersht, founder and CEO at HFS Research, told Information Age that “UiPath is realising to its cost that intelligent automation is a marathon, not a sprint. It pushed the hype around RPA far too aggressively.”

This represents a major credibility crisis for UiPath, valued at $6.4 billion this year, the burgeoning RPA market as a whole and highlights the systemic problem of chasing market share and over valuation.

Fersht said this is a similar story to the “investor scrutiny after the WeWork debacle [which] caught them cold, as they simply could not justify their burn rate of cash versus customer demand.”

RPA and intelligent automation is here to stay

But, despite this, RPA has a significant role to play in the future of automation. It has “some terrific benefits to support efficiencies and process transformations,” according to Fersht, although “it forms part of a broader toolbox as companies evaluate both automation and AI options.”

He continued: “Intelligent automation is here to stay, but enterprises need real help to adopt it at scale – the vast majority have failed to surpass five bot implementations. It is imperative that enterprises invest time and resources evaluating their business processes before taking the plunge buying software that will only deliver once the business cases has been defined.”

Why RPA? Blue Prism chairperson tells Information Age why he thinks RPA is a game changer

Why RPA? Information Age spoke to Jason Kingdon, chairperson of Blue Prism. RPA is in it for the good he said and it’s going to transform business. Read here

IA analysis

This is a systemic problem and does not apply to just one company. In today’s ultra-competitive environment chasing market share is the most important goal for executive leadership teams. How can they achieve this? With a great product, innovative technology and the ability to solve a problem. But, a “land grab for logos”, while speeding up growth, is not a savvy business strategy. Revenue needs to be high quality and targeted, not smash and grab.

There is a major lesson to be learned here. Don’t push hype (guilty of many companies across industries) or over value your business — it’s a recipe for disaster and can lead to redundancies.

To be sure, UiPath will need to answer some serious questions around its conduct and strategy, but as the market leader it still has a huge role to play in this area. RPA, as well, will not die here. The technology has a fundamental role to play in the future of automation in the workplace and will contribute to the transformation of industries.

Latest news

divider
Start-up scene
How European tech founders can supercharge growth in 2021

How European tech founders can supercharge growth in 2021

5 March 2021 / The last year has shown that the growth of European tech is unstoppable. Tech.eu reported [...]

divider
People Moves
Cancer Research UK appoints new COO and CTO

Cancer Research UK appoints new COO and CTO

5 March 2021 / The creation of new COO and CTO roles at Cancer Research UK bring the completion [...]

divider
Research
Digital experiences failing in financial services — VMware

Digital experiences failing in financial services — VMware

4 March 2021 / The widespread lack of improved digital experiences delivered by financial services companies, as found by [...]

divider
Data Analytics & Data Science
Why making the business case for text and data mining is key to embracing digital techniques

Why making the business case for text and data mining is key to embracing digital techniques

4 March 2021 / We live on the edge of an age of unlimited potential. Advances in artificial intelligence [...]

divider
Tech and society
Food tech in the pandemic: digesting the second wave of innovation

Food tech in the pandemic: digesting the second wave of innovation

3 March 2021 / The cultural and social implications of Covid-19 have accelerated trends in the food tech sector [...]

divider
Releases & Updates
Spring Budget 2021: what it means for the UK tech sector

Spring Budget 2021: what it means for the UK tech sector

3 March 2021 / Chancellor Rishi Sunak has announced his 2021 Spring Budget, as the UK economy continues to [...]

divider
M&A
Wunderman Thompson acquires NN4M to strengthen commerce offering

Wunderman Thompson acquires NN4M to strengthen commerce offering

3 March 2021 / In an aim to advance towards delivering effective cross-channel engagement platforms, the acquisition of NN4M [...]

divider
People Moves
Ian Duggan appointed Indigo Telecom Group CEO

Ian Duggan appointed Indigo Telecom Group CEO

3 March 2021 / Duggan joins as CEO after founding and serving as CEO of 4site, the mobile wireless [...]

divider
Case Studies
EIS partners with esure Group to expedite digital transformation

EIS partners with esure Group to expedite digital transformation

2 March 2021 / The partnership between esure and EIS marks the start of a transformation programme, which includes [...]

Information Age

Pin It on Pinterest