How tech unicorn UiPath is scaling exponentially thanks to its mammoth procurement transformation
It seems that when it comes to robotic processing automation (RPA), the name on everyone’s lips is UiPath. The American firm has achieved a lot in its short history. At its genesis, UiPath was just a team of 10 based in Bucharest but now it’s headquartered in New York City, boasting 30 offices in 16 countries and more than 1,700 employees.
“‘Growth’ is the key word at the firm,” points out Catalin Lupu, Head of Global Procurement, and the technology community seems to agree. The firm was listed 26th on Deloitte’s Technology Fast 500 – a ranking of the crème de la crème in the technology, media, telecommunications, life sciences and energy tech companies in North America. In 2018 alone, UiPath closed its Series B and Series C financing rounds totalling USD$418mn, lifting the company’s valuation to an impressive USD$3bn.
UiPath has, by all accounts, been a gleaming example of how to scale a tech startup and, for Lupu, this is thanks in part to the firm’s robust procurement function. Before joining UiPath, Lupu cut his teeth in procurement with time at firms like Renault and the Goodyear Tire & Rubber Company respectively. Through these roles, Lupu honed his skills and says that it provided him with a “global view” which enabled him to “understand the challenges and steps needed to scale up a business”. This proved to be a critical skill when he later moved to UiPath.
UiPath began as a small startup with a procurement spend of around USD$2-3mn but CEO Daniel Dines had big ambitions. He wanted UiPath to be a market leader. To kick off this growth, the firm first had to convince the market of the merits of RPA and build a strategic roadmap. “We basically started from scratch,” explains Lupu. “I like to describe it like building a house. First of all, we laid the foundation. In procurement, we decided our policies, how we should buy, what architecture we should use, how the procurement function should look like in a year from now. That’s where it started.” UiPath didn’t think small; it crafted its roadmap with a global mindset from the offset. Rather than confining itself by regions, it standardised its procurement function at a global level.
Compliance was also a crucial factor. “The policies are shaped around the business’ needs and compliance because when you're working with clients like Fortune 500 firms, we wanted to make sure that everything is auditable, that they're doing everything by the book. We also didn’t want to make it too difficult to manage or too granular for approvals so we implemented procurement cards.” After laying the foundation, UiPath turned its attention to building the walls and the structure. For procurement, this meant implementing the systems. “We wanted everything to be digitalised so, for instance, we implemented procure-to-pay (P2P) and finance modules from Net Suite,” notes Lupu. “We wanted to drive the company forward, we wanted to automate and to liberate our people from repetitive stuff so that they could be more focused on strategic tasks like emailing a new supplier. It also enabled us to deliver analytics at a global level. I think that is the holy grail and it’s where a lot of companies struggle.” By implementing a cloud-based solution, this not only made the move from offline to digital seamless, it also allowed UiPath to get access to purchase orders (POs) on all devices – ideal for any global, fast-moving firm – which were easily integrated with other applications.
A key task for any company, particularly in the IT sector, is attracting, retaining and training the right talent and it was another key facet in UiPath’s transformation story. “Bringing the right people is essential when scaling,” reflects Lupu. “We built up a culture and a team that's ready to scale and that's prepared for any challenges the clients may have. “They're very focused on the client needs, and internally it's been quite a successful journey for them, because most of them come from different industries. We looked at their potential as well as their skills.”
UiPath has quickly become synonymous with the RPA market, acquiring an average of six new customers per day. Yet, this rapid growth hasn’t come without its challenges. As the first footprint has expanded it had to establish new real estate, pay rolls and recruitment in different geographies. “Growth is a good problem to have,” laughs Lupu, “but it’s still a challenge.” To tackle this, UiPath’s procurement team have worked hard to develop strong industry links and vendor partnerships that are able to keep pace with the firm’s global vision.
“We don’t see these firms as suppliers or vendors, they’re partners because when we try to go global, we need partners that will stick by us, who will insulate us, and be able to adapt to the market,” Lupu explains. Take the issue of real estate, highlights Lupu. With a footprint spanning from London to Tokyo, Bengaluru to Singapore, offices are a top priority for UiPath and therefore it has developed strong relationships to make this a reality. “We have a big spend on real-estate, so we have a very interesting and successful strategy,” he says. “When we enter a new country, we start off in co-working space so that we can create a presence there and start hiring. We have a global partnership with We Work, which provides a single point of contact for us globally, which is a robust model when you need a presence across the world.”
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UiPath has sought out partners which have an international presence yet local knowledge. It found this with partner CDW who helped to enhance the firm’s IT management. “One of the challenges when growing globally is finding global partners who can meet this footprint and deliver what you need, whether it's in Europe, the US, Asia or in India,” notes Lupu. “We found that CDW was one of the few in the market who could achieve this and helps us manage the IT span and delivery. They helped us centralise all the hardware that we were buying individually in countries by creating synergies. They understood that we needed a global single point of contact which is hands on.”
As the role of procurement morphs rapidly into a business enabler, rather than a back-office function, it’s also getting more digitally-savvy. Just as its users have adopted UiPath’s RPA platform to take their business to the next level, UiPath’s procurement team are also using its own product. Lupu points out that, by getting robots to automate mundane and repetitive tasks, it allows his team to focus on value-adding jobs. “It automates repetitive work so people can focus on more strategic or creative jobs,” he explains. “RPA doesn't only apply to procurement or finance. It can be applied to supply chain, it can be applied to delivery, call centres, banking, any industry that's had repetitive standardised processes which could be automated. That's why I think it's very disruptive, because it can apply to any industry.”
Lupu believes the procurement sector is undergoing a seismic shift – teams are more focused on return on investment (ROI) rather than savings, the field is also becoming more digitised, and teams are being created based on ambition just as much as their skills. Having built its procurement function from the ground up, procurement has been a pivotal enable of UiPath’s growth and Lupu believes his strategy is a simple but meaningful one. “The main rule is that procurement needs to be smart, it needs to be simple and it needs to be scalable,” asserts Lupu. “Now, we have around 1,700 employees, next year we could have 10,000. I think the keyword now is still growth; we’re in skyrocket mode. Where there is an enterprise market, we need to be there. Our focus now is growing the business and to remain a leader in the RPA sector.”