 The Cube presents UiPath Forward 5, brought to you by UiPath. Okay, the party has started here at Forward 5 UiPath's big customer event, you watch The Cube. We're wrapping up day one with the co-CEO segment. Daniel Dines is here, he's the founder and co-CEO of UiPath, and Rob Enslin is the co-CEO. Gents, great to see you. Thanks for spending some time with us. I know you're super busy. Thanks, Dave. So I've been looking forward to this. Daniel, you know, I've followed the company for a long time. The really interesting path you took to get to where you are today. How did you guys meet, and why did you decide to hire Rob? Well, let me start. I was looking for a partner. Actually, in our work, do your stand here. We are talking about how you feel in this job. You feel so alone. Because you are at the center of all pressure points. And having a partner, having someone that has your back, it's kind of awesome. So I was looking for a partner, and our common friend, Karl Aschenbach, introduced us to each other, and we instantly clicked. And this is the type of job where it's either work well or it doesn't. It cannot be anything in the middle. Right, Karl, we know Karl well. Awesome operator, knows the business super well. So Rob, what attracted you to UiPath? You had a great situation at Google. You guys were growing like crazy. Why did you decide to come here? What did you see that attracted you? Yeah, you know, when I went to Google, I went to Google because I really believed that data and AI was necessary for companies. And businesses to be competitive in the future. And we did some great stuff at Google Cloud in the three years. But I knew UiPath from a couple of years ago when they were mainly in RPA space. And I just felt that there was a place in time where automation was gonna expand. And as I sat down with Karl a couple of times, spoke to Karl, and then I sat down with Daniel, I knew that there was something special with UiPath, there could be a generational opportunity not only for myself, but for the company in the future. And then I got to know Daniel. And at this stage of my career, I was like, I'm pretty fussy about what I want to do and what I want to go. First of all, I wanted to go to a company that had a great product, had a great culture, and I wanted to work with somebody that we could shape the future together. Daniel and I just hit it off from the very first time we met. He got to meet my family, my dogs, and we did the whole courting thing before we actually decided this was gonna be a good thing for both of us. That's good, you gotta meet the family. We just had, John Furrier and I just had Mohit Aran and Sanjay Phoonan into our studio. Because Mohit, former Google, long time, and they decided to kind of split duties. Mohit's going into product, he didn't keep the CEO title, you are. How are you guys splitting your time? What are each of you kind of responsible for? It's kind of similar. On a day-by-day operation, I rely heavily on Rob. We do together strategic decisions about the company destiny. I'm doing mostly the product these days, which is a big relief for me. And I think we also split a bit the customer's visits. Which is great, I still enjoy meeting customers. I need customers and food for my thoughts. And you're an awesome product visionary. You've been there since day one. Now Rob, you said in the keynote today that you've seen around 100 customers, you've traversed the world. What did you learn from them that informed you, that gave you confidence that the move to the enterprise platform, even though you had already started that, but you're really doubling down on that from a standpoint. You know Dave, when you think about it, I was so impressed that Daniel had the vision to create a platform three years ago. Yeah. Right? And as we went around the world, as I went around the world, it was one of the very first things I said, I've got to understand, have customers see UiPath on their vantage point. What are they looking for from us? Why is this company, why do customers like this company so much? And as I went around the world and I went to Asia, Australia, Singapore, Japan, I was in Europe twice, we did a trip together, we went to visit customers. And it was very much the same thing, help us expand automation faster. And we are so surprised at the breadth of your platform. We never knew that. And so it kind of just had, for me it was conviction, it's like this was the right decision you made, there's so much opportunity here. And that's kind of what I've learned in the last four or five months. Now as you know, Daniel, I've written a lot about your company. One of the things I said is that startups, if I could call you that back pre-IPO, typically don't have as much international exposure as UiPath had. I mean you sort of started as an international company and became more US centric. You said in the keynote today, you're talking to Ray Wong about, people maybe don't understand the challenges of FX. Point being, when you convert international dollars into US dollars, there are less of them because the dollar's stronger. But still, I've always felt like that international footprint is an advantage. Rob, you came from SAP. Again, European based company. Do you regret that now? I mean, I know it's more tactile, I'm sure you don't. But talk about that sort of international exposure why that's a long term benefit. Well, first of all, we expand faster. I think we expanded faster than our competition because our global footprint was larger. And we had the courage to go in Japan, for instance. Everybody told me it's impossible to make for such a small startup, it's impossible to make a business in Japan. But we didn't believe it. We were just crazy and we went there and we built a very sizable business in Japan. 55% of our revenue, even today, it's outside US. Now, of course, that has the downside when the local currencies are losing the value compared to the dollar, we are impacted as we call to investors until now. So we are seeing like an 80 million headwind in terms of ARR, it's huge. Only because of FX and losing the business in Russia. But it's still, it's the strength of our company. Things will come back. And then the growth engine will reaccelerate again. Yeah, when the dollar weakens, that'll get you in your favor. Rob, I want to pick up on something you said today in your keynote. You went back and started the cycles of ERP and internet, et cetera. I kind of have a love hate with ERP. I have to be honest, but if I will go back to the late 80s, 90s, you wouldn't have been able to pick SAP as the winner and then SAP emerged very clearly. But the more interesting thing is that the customers who were implementing ERP well, the practitioners did better than their peers. It dominated their industries and their stocks went up, their valuations went up. Different world, obviously, but do you see the same thing happening with RPA and automation? What gives you confidence that that's the case? I absolutely do see the same thing happening with automation and RPA being a part of that. The reason I believe that is speed is so critical and if you think about how hard it is for a CIO or a C-level executive to consume the technology coming at them, plus all the changes in the world being thrown at them, it's compiling and compiling and compiling. We have an incredible solution that can help companies in these constrained times deliver outcomes to their business like no one else can. And when I see that, I view that as just like the beginning of what's gonna happen in the future. So in many ways, and I've said this to many of my friends, it feels like 1992, 93 to me. And it's interesting because nobody really understood that why SAP would be great in 1992 and 93. And they got a couple of things right. They got the ecosystem right, the new partners were important, and they knew they needed to drive business outcomes for companies in which they did. And so I feel like we are in a very similar place, very different technology obviously, and the speed of change now is so dramatic compared to what it was. And there's very few technologies that can provide that level of speed and accommodation to their customers. All right, let's talk about priorities. You guys got a lot of work to do and you've laid it out to the financial community. You gotta have profitable growth because FX, in part, you've lowered your forecast. But I think there's some conservatism in there as well. But you got to do that balance. You've given some guidance on gross margins, cloud maybe brings that down a little bit. R&D, I saw a wide range, 13 to 17%. I hope you keep spending on R&D. Big fan of that. Stock buybacks, R&D, if you're in your position are going to be better. And the product priorities continue to build that out. My question, let's start with the product. So you've got an on-prem stack and you've got a cloud stack that's emerging. How do you balance those out? How do you do the integration? You've done a great job with the integration. Are you concerned about your ability to continue to work at that speed with two code bases? I wonder if you could address that. We've become a cloud-first company. We deliver all of our products first in the cloud. We deliver on a two-week cadence in the cloud. So that helped us iterate quite fast. I think we made a very good business decision to build our cloud team in Seattle, in Bellevue to be specific. And we have access to great talent that knows how to build serious cloud service, which is a hard-to-find talent. And also, we benefit... One of our early benefits was we have a really good architecture. We have an architecture that works easily on-prem and on-the-cloud. And even today, our workflow foundation, our local no-code designers, were easy to modernize. So right now we are launching StudioWeb. But behind the scenes is the same workflow engine. Our customers don't have to rewrite anything. It just works. And it was the same easy to take our on-prem product and run it in a multi-tenant cloud. So there is no friction at all. Actually, cloud is just helping us accelerate. But we benefit again of a really solid architectural foundation. Architecture matters. We've seen that in this industry. We got the B-52s rocking out in the background. I love it. But I got so many questions for you guys. I want to talk about the go-to market. Yeah. Because Rob, it's obviously a strength of yours. You've come in, you've communicated to the street that you're reshaping your sales force. I think lowering the ratio of sales, people, the customers at the high-end, mid-range, as well, using digital. I mean, I think the numbers are 1 to 10 now at the top. 1 to maybe 50 at the mid-range. Where are you in terms of that journey? You've got to find people, you've got to train them. How do you get the productivity out of those guys? Take us through your thinking there. Yeah, first of all, I think we have enough resources. I think resources are not an issue. We have an incredible vehicle to acquire customers inside the company. Our digital sales motion is probably the best I've seen. And so we have the ability to acquire customers really fast. And we get the first workload in really fast. The challenge is we need to be able to drive a propensity model where we graduate customers when we acquire them into the direct sales force. And that direct sales force, we're not going to go 1 to 30. We're talking 1 to 10 for the direct sales force. And even higher up in the pyramid, we want to have even a denser model on that. And the whole purpose is to drive the time to consumption much quicker, much faster. So we know exactly if we acquire a customer, will they spend? Do they have a propensity spend? And on what levers do they have a propensity to spend? And therefore, when we capture them, we can immediately surround them and put the right resources so we can grow faster. We think this will have a significant impact on the organization. We'll start to implement certain pieces in the next quarter. Things like packaging solutions, putting that in enabling the sales organization. And by the beginning of next year, we'll be ready to actually go full ball globally. We already put some pieces in place when I joined. Chris Webber, my chief business officer, did a great job doing some of those pieces. So we're on the journey already. Yeah, and even before you guys were public and you weren't publishing your NRR numbers, our ETR survey partner, we always saw you had very low churn. And I think you broke out just yesterday, the NRR for overseas versus US, I think it was 140 plus percent, very, very strong, a little less overseas, but the churn is still very low. Okay, so that's super positive. Customer affinity, I always, when I go to these events, I listen to the keynotes very carefully and then I interview customers on the Cube and I try to identify, is there alignment there? And I've seen very strong alignment, I have to say, and strong customer affinity. So that's in your favor. I had, Daniel, I got another question for you on product. What is semantic automation? What the heck is that? Can you explain that? I don't understand. Dave, have you seen the demo in my keynote? You know, I had to leave and do interviews, so I missed it. I think that demo answered completely your question. So in the scene, you know, there is a saying that great, you cannot distinguish great technology by magic. I think technology should be simple. And we showed today one of the simplest demo that you can imagine, but it's such a complex technology behind the scene that you also cannot imagine. So what was the demo? We show how one business user, without any technical skills, can go to any type of document, can be a passport, can be an invoice, can be a legal contract. And just show, I wanna copy data from here, and I wanna paste data there. Can be a spreadsheet, can be another application, and like a human user, without understanding, without having prior knowledge about data, document layout, about screens, screens layout, nothing. We analyze real time document. We discover the meaning of the information. We analyze the screen. We understand the screen, but we understand the meaning of the screen. And we understand how information in one side relate to the other side. And we just connect the dots, and we copy the information, and we paste it. A job that you would do as a human user, maybe three minutes, it's done in 10 seconds. This is powerful. Yeah, that is powerful. Thank you for that. I mean, and you take the data, whether it's transaction data, or unstructured data, and bring meaning out of it, that's powerful. Last question, I'll let you guys go. Rob, you got traders, and you got long-term investors. Traders are gonna be defensive today. I get that. Make the case for UiPath for long-term investors. I think we're gonna be a multi-billion dollar company, and we're gonna be a generational company of our time. We will define enterprise automation, and it's gonna be a long-term game, and we feel like really strong that we'll be the lead in that game. Guys, thanks so much for coming on theCUBE. Great show. Always fun at UiPath Forward. Really appreciate your time. Thank you. Thanks Dave, appreciate it as well. Okay, wrapping up day one. We're here tomorrow. First thing, Dave Vellante and Dave Nicholson. Thanks for watching. Forward Five, UiPath's big customer event. We'll see you tomorrow.