 Live from Las Vegas, it's theCUBE, covering UiPath Forward Americas, 2019. Brought to you by UiPath. We're back in Las Vegas, UiPath Forward Three. You're watching theCUBE, the leader in live tech coverage. Bobby Patrick is here, he's the CMO of UiPath. Welcome. Hi Dave. Good to see you. Great to be here. Wow. Great to have theCUBE here again, right? theCUBE loves doing these hot shows like this. I mean, this is, you've said, Gartner has the fastest growing software segment. You've seen the data that we share from ETR. You guys are off the chart in terms of net score. It's happening, hanging on to the rocket ship. How's it feel? Well, it's crazy. I mean, it's great you all have seen some of the growth along the way too, right? I mean, we had our first forward event less than two years ago, and about 500 plus non-UiPath people. Then a year later, it was Miami. It's where we launched theCUBE, I think, was Miami. That's right, yep. And that was a great event, but that was more in the 1300, 1400 range. This one's almost 3000, and the most amazing part about it was we had 8% attrition from the registrations. Yeah, that's insane. I've never seen that. We're averaging 18% to 20% for all of our, most of our events worldwide, but 8%. The commitment is unbelievable. Even 18 to 20% is very good. I mean, normally you'll see 25 to sometimes as high as 50%. Yeah, right. It just underscores the heat. Well, I think what's also great, other stats that you might find interesting. So over 50% of the attendees here are senior executives. Like for the first time, we actually had C-level executive CHROs and CIOs on stage, right? You can feel the interest level. Now, of course we want RPA developers at events too, right? But this show really does speak, I think, to the bigger value propositions and the bigger business transformation opportunity from RPA. And I mean, to come so far, where no one knew RPA two years ago, to the CIO of Morgan Stanley on stage this morning, raving about it, we've come a long way in two years. Well, and I saw a lot of the banks here hovering around, you know, knocking on your door. So they know they're like heat-seeking missiles, you know? So, but the growth has been amazing. I mean, I think ARR 2017 was what, 25 million? Well, at this time, at the end of 17, it was 43 and a half, but 25 in October. So it's 12 times higher now. 12X. 12X growth. Which is the fastest growing software company, I think in every... We know from one to 100 we were. We did that in 21 months and we had banks who, now we're not really counting anymore. And we're kind of now focused more on customer expansion, even though we hit 5,000 customers, which we started the year at 2,050-ish. We just crossed 5,000. I mean, so the number of customers is great, but there's no question. This conference is focused on scaling, helping them grow enterprise-wide with RPA. So I think our focus will begin to shift a bit, you know, to really customer expansion. And that's a lot of what this announcement, the product announcements were about. It's a lot of what the theme here is about. We had four dozen customers on stage. You know, the Ubers of the world, the Amazons of the world. It's all about how they've been scaling. So that's the story now. Well, you know we do a lot of these events and I go back to some of the, when theCUBE first started, companies like Tableau, Splunk, ServiceNow. I mean, when you talk to customers, first of all, it's easy to get customers to come talk about RPA. And they're all saying the same thing. I mean, Jean Younger said she's never been more excited in her career from a security benefit. But the thing is, Bobby, I feel like they're really just getting started, right? I mean, most of the use cases that you see are again, automating mundane tasks. We had one, which was, I think American Fidelity, which is they're really bringing in AI. But they're really just getting started. It's like one, two, three percent penetration. So what are your thoughts on that to kind of land and expand if you will? Well, I think, you know, look, last year we announced our vision of a robot for every person. At that point, we had SMBC on stage and they were the one behind it and they are an amazing story. Now we have a dozen or so that are on stage talking about a robot for every person like Singtel and others. And so, but that's a pretty bold vision. I think it's important to look at it both ways. There's huge gold in applying RPA to solve real problems. There's a big opportunity enterprise-wide, no question, and we've got that. But look, New York Foundling was on stage yesterday. New York Foundling is a 150-year-old associate or charity in New York focused on child welfare. Started by three sisters of charity. They focused on infants and anyway, it's an amazing firm. Just the passion that New York Foundling had on stage with Daniel yesterday was amazing. But they flew here because for once they found a technology that actually makes a huge difference for them in their mission. So their first RPA operation was, they have 850 clinicians. Every week they spend four hours a week moving their contact, new contact data associated with new child issues. From system to system, to spreadsheet and paper to system, right? They use RPA and they now save about 200,000 hours a year. But more importantly, those clinicians spend those four hours every week with children. Not moving it. So I'm still taking, I think Daniel had a bit of a tear in his eye hearing them talk about it on stage. But I'm still taken by the sheer mass of opportunity for RPA in a particular to solve some really amazing things. Now, on a mass scale, a company can drive 10, 15, 20% productivity by every employee having a robot. Yes, that's true. On a mass scale, they can completely transform their business, transform customer experience, transform the workplace on a mass scale. And that's a C-level goal and that's a big deal. But I love these stories that are very real and I think those are important to still take style. Well, it's a great tech for good story. Look, tech with the whole Facebook stuff and the fake news got beat up. And Benioff come out recently and say, hey, it's not just about increasing the value to shareholders, it's about tech for good and doing other things, affecting lifestyles, life changing. Michael Dell is another one. Now, I've kind of said tongue in cheek, show me the CEO misses his four quarters in a row and see if that holds up. But nonetheless, you love to see successful companies giving back, it seems to be it's part of your culture. Well, look, I've been part of hardware companies and I met you all through a few of them and others. They have good noble causes, but it was hard to really connect the dots. Yes, there's CPUs underneath a number of these things. But I think judging by the emotional connection that these customers have on stage, right? And these are the Walmart's and Uber's and others of the world. Judging by the employee and job satisfaction that they talk about, the benefits there. I just, my career, I have not seen that kind of real direct impact from B2B software, for example, on the lives of people, both every day at work, but also dissolving, helping accelerate human achievement, right, in so many amazing ways. We had the CEO of the UN IT Shared Services Group on stage yesterday. And they have a real challenge with the growth of refugees worldwide and it would express it. And they can't keep up. They don't have the funding, which is, you know, with everybody and Trump and others trying to hold back money, but they have this massive charter of good, the only way they get there is through digital. The new CEO, the new head of the UN is a technology. He's an engineer. He came in and said, the way we solve this is with technology. And they decided, they said on stage yesterday that RPA, RPA is the path to AI and the greater new technologies, that's how they're going to do it. And it's just a really, I think it feels really great. You know, it's funny that one of the things we've been talking about this week is people might be somewhat surprised that there's so much headroom left for automation because they're like, well, we're 50 years of tech, haven't we automated everything that's to the other end? Daniel put forth the premise last night that actually technology's created more process, problems, more inefficiencies. So it's almost like tech has created this new problem. Can tech get us out of that problem? Well, essentially, think about all the applications we use in our lives, right? Although people do have a Salesforce stack at some times in the SAP, the reality is they have a mix of a bunch of systems. And then we add Slack to it and we add other tools and we add, the tools alone have some great value. But from a process perspective of how we work every day, right? How a business user might work at a call center, they have to interact then. And the reality is they're often interacting with old systems too because moving them is not easy, right? So now you've got old systems, new systems, and really the only way to do that is to put a layer on top of the systems of engagement and these systems are record, right? A layer on top that's easy to actually build an application that goes between all of these different applications, Outlook, Excel, legacy systems, Salesforce.com, and so on. And build an app that solves a real problem, have it have outcomes quickly. And this is why, Dave, we unveiled the vision here that we believe that automation is the application. And when you begin to think about, I can solve a problem now without requiring a bunch of IT engineers who already are maxed out, right? I can solve a problem that can directly impact the business, directly impact customers, and I can do that on top of these old technologies by just dragging and dropping and using a designer tool like Studio or StudioX, and a business user can do that. That's game change here. I think what's amazing is when you go talk to a CIO who says, I've been automating for 20 years, well, you know, I can't get the ROI. Once they realize this is different, the light bulb goes off, we call it the automation first mindset. The light bulb goes off, and you realize, okay, this is a very different, whole different way of creating value for an organization. I mean, I think about how people, the way that people work today, you're constantly context switching, you're in different systems, like you said, Slack, you're getting text, and you want to be responsive. You want to be real-time. I know Jeff Frick was the GM of theCUBE, he's got two giant screens on his desk. I myself, I always have 15, 20 tabs open. People go, oh, you got so many tabs open. Yeah, because I'm constantly context switching, pulling things out of email, going back and forth, and so I'm starting to grok this notion of the automation is the app. At first I thought, okay, it's the killer app, but it's not about stitching things together through APIs, it's really about bringing an automation perspective across the organization. We heard it from Pepsi yesterday. Sort of the fabric, the automation fabric throughout the organization. Now that's aspirational for most companies today, but that really is the vision. But I think you had Layla from Coca-Cola also on, right? And their vision there, and they actually took the CDO role, the CIO role, and put them together and they're realizing now that that transformation's driven by this new way of thinking. Yeah, I think, look, we introduced a whole set of new products and capabilities around scaling, around helping build these applications quicker. I think, fast forward one year from now, the vision we outlined will be very obvious, the way people interact via UiPath to build applications that's all coming, the speed that they operate will be transformational. And so, you see this conference here, I mean, you walk around, I mean, you saw last year, or you see the year before, but it's a whole, the speed at which we're evolving here. I think it's unprecedented and it'll be more exciting. I want to talk a little bit about the market forecast. Craig Leclerc was awesome this morning. He really knows his stuff. Now last year, I saw some data from him, it said the market by 2020 would be $4 billion, and I said, no way, it's going to be much larger because it's going to be $10 billion by 2020, the Dave Vellante forecast, back in napkin by old IDC day forecast. Now, what he showed today is data, actually it was $10 billion by 2020 because he was including the services, which is what I was including in my number as well. But the thing of it was so good for him. Now, but the only thing is, he had this kind of linear growth, and that's not how these rocket ship markets grow. They're more like an old guy or an S curve, you're going to get some steep part. Now, so I'd love to see like a longer term forecast, because it feels like that's how this is going to evolve. Right now, it's like you've seeded the base, and you can just feel the momentum building, and then I would expect you're going to see massive, steep sort of exponential growth, steeper than maybe non-linear, because that's how these markets tend to behave. This is also going to come from the expansion potential. None of our customers are more than 1% automated from an RPA perspective, so that shows you the massive opportunity. But back to the market data size, Craig and I, in the other analysts talk often about this. I think their TAM views are very low. You'll look at our market share. Let's just get real data out there, right? Our market share in 2017 was 5%. Let's use Craig's linear data for now. Our market share this year is over 20%. Our market share, applying, and I don't want to give the exact numbers out as we don't provide guidance anymore, is substantially gaining share. Now, I believe that's the reality of the market. I think because we know blue Prism's numbers, we grow four times faster than them every quarter. Automation anywhere won't share their numbers, but I can make some guesses, but either way, I think we're gaining share on them significantly. I think Craig's not going to want us to be 50% of the market in two years. He's just not. And so he's going to have to figure out how to think more broadly about that market trend. He talked about it on stage today, about how does he calculate the AI impact and the other pieces now, the process mining now, now that we are integrating process mining into RPA, the strategic component of that. How does that also evolve the market? So I think you have both the expansion in the product portfolio, which drives it. And then you have the fact that customers are going to add more automations at faster pace and more robots. And that's where the expansion really kicks in. And we often say, look as a company that one day will be public company, our ARR number is very important and we do openly, transparently share that. But the other big metric will be dollar based net expansion rate that shows really how customers are expanding. I think that, I know what our number is, we haven't shared it yet. I know all the SaaS companies, the top 10, I can tell you we're higher than all of them. The market projections are low and I think he knows it. Well, speaking of TAM, and I saw this with ServiceNow, now ServiceNow the core was IT. So the ROI was not as obvious with you guys you're touching business process. And so, and David Floyer way, way back did an analysis of ServiceNow. We said, wow, the TAM is being way undercounted by everybody, the Wall Street Analysts, Gardner, it feels like the same here because there are so many adjacencies and you talk to the customers and you're seeing that the TAM could be much bigger than whatever, 16 billion that Daniel showed you. Daniel said, the guy's got balls. He said, that's 16 billion, that's UI path at this date. And you know, we laugh, but I'm listening to him saying, I wonder if he's serious because this guy thinks big. I mean, who would have thought that you'd be at this point by now and you're just getting started? Well, I think, you know, one thing I think is, you know, we're, you know, we were a little bit kind of over a little less humble when we talked about things like valuation over the last two years, we were really trying to show this market's real. You know, we want to now focus more on outcomes and things, get a little less from around those numbers. And I think that shows the evolution of a company's maturity that we, I think we're going through right now. You know, the outcomes of, you know, Walmart on stage saying, you know, their first robot, this was two years ago, delivered 360,000 hours of capacity for them in HR, right? Done, you know, I think those, that's where we're going to be focused because the reality is, if we can deliver these big outcomes and continue them and we can go company-wide, deliver on a robot for every person, then, you know, the numbers follow along with it. Well, we saw some M&A this week as well, which again, leads me to the larger team because we had PD on with Rudy and you can start to see how, okay, now we're going to actually move into that vision that the guy from PepsiCo laid out this fabric, this automation fabric across the organization. So M&A is a part of that as well. That starts to open up new TAM opportunities. It does and I think, you know, process mining is a great example of a market that is pretty well known in Europe, not so much in the U.S. And there are really only a few players in that market today. Look, we're going to do what we did in RPA. We're going to do the same thing in process mining. We're going to do the same thing we're doing in IT and that is democratization. You know, our strategy will be to go mass market with these technologies, make it very easy for accessibility for every single person, in the case of process mining, every business analyst to be able to mine their processes with them and ultimately that flows through to drive faster implementations and then faster outcomes. I think, you know, our approach, again, our approach to business users, our approach to democratization, you know, it's very different than our competitors. A lot of these low-code companies, I won't name a number because I don't remember our partners here at our conference, you know, they're IT focused, their service is heavy and their growth rates, albeit okay, are 30% year over year. In this market, that shouldn't be the case at all. I mean, we're 200 plus year over year still and we've got big numbers. And we have a whole different approach to the market. I don't think people have figured it out yet, Dave. Exactly the strategy behind, which is when you have business users, subject matter experts, citizen developers that can access our technology and build automations quickly and deliver value quickly for their company and you do that at mass scale, right? And then you allow with our apps for end users like in a call center to engage with a robot as part of their daily operation. That, none of the other IT vendors who are all kind of conventional thinking and that's not, our models are very different which I think shows in our numbers and in the growth rates. Yeah, well you bet on simplicity early on. In fact, when you joined UiPath, you challenged me. You said, have some of your Wikibon analysts go out and download our stuff and then try to download the competitors and tell us how easy it is. Well, we were able to download UiPath. We built some simple automations. We couldn't get a hold of the other company's product. We tried. We were told we'll go to the reseller or how much do you have to spend and okay. So you bet on simplicity, which was interesting because Daniel last night kind of admitted, look, he thanked the audience. He said, thank you for taking a chance on us because frankly a couple of years ago, this wasn't fully baked. Right. And so I want to talk about last topic is sort of, one of the things Craig talked about was consolidation and I've been saying that all week. He said, this market's going to consolidate. You guys are the leader now. You've got to get escape velocity because the leader makes a lot of money and it gets big. The number two does okay. Number three, everybody else and the big guys are starting to jump in as well. I saw SAP makes an announcement. You guys are specialists. And so your thoughts on hitting escape velocity. I wouldn't say you're quite there yet. I want to see more in the ecosystem. There's maybe, who knows? Maybe there's an IPO coming. I've predicted that there is. But your thoughts on achieving escape velocity and some of the metrics around there, whether it's customer adoption, penetration. What are your thoughts? We definitely don't have a timetable on an IPO but we have investors, public investors and VCs that at some point are going to want. This is the reality of how it works. I think the numbers to focus right now are around customer outcomes. I think the ecosystem is a good one, right? We have, I'd say the biggest ecosystem for us to date has been the SAP ecosystem when we look at our advisory board members or others. That's really where the action is. Supply chain management, ERP, certainly CRM and others. We don't have a view that some of our competitors have. Like we have chosen not to take money from ecosystem companies. Our customers here are building processes on automation across ecosystems, right? So we don't want to go bet on, say, just one, like Salesforce or Workday. We want to help them across all of the ecosystems. Now, so I think it's a little bit of a different strategy there. Look, I think the interesting thing is the SAPs of the world, they bought a small company in France called Contexture. They're trying to do this themselves. Microsoft, Microsoft and Mark Benioff at Salesforce are asked what are you doing for our PA so they've got pressure. So maybe they invest in one of our competitors or maybe they take flow and Microsoft and expand it. I think they can't move fast enough because I don't know if Microsoft has, I mean they're a great sponsor here by the way, so I don't want to be careful what I say, but strategically speaking, these larger companies operate in 18 months, 12, 18, 24 month kind of planning cycles. If you did that, you'll never keep up with us. There's no one at any of our, at the traditional large enterprise software companies that ever would have bet that we would come out and say that the best way to build applications, right, to solve problems will be through our PA and there'll be a layer on top of all their technologies that makes it easier than ever for business users to build applications to solve problems. That's going to scare them to death. Why? Because you don't have to move all your legacy systems anymore. Yes, you've got tons of databases, but guess what, don't worry about it. Leave them alone. Stop spending money on ridiculous upgrades, right? Now just build the new layer. And I'm telling you, if they figure this out, they're going to keep looking back and say, oh my God, why didn't we know? Why did we know? Look, I hopefully we can all partner, we're going to try to go down that route, but there's something much bigger going on here and they haven't figured it out yet. Well, the SAP data is very interesting to me. Now I'm starting to connect it out. I just did a piece on my breaking analysis and SAP, thank you, they've acquired 31 companies over the last nine years. And they've not bit the bullet on integration the way Oracle had to do with Fusion. And so as a result, they say throw everything into HANA into memory, that's not going to work from an integration standpoint. Automation is actually a way to connect the glue across all those disparate systems. And so that makes a lot of sense that you're having success inside SAP and there's no reason that can't continue. Well, there's a number of major trends we've outlined here, one of, we call human in the loop. And today, when an unattended robot can actually stop a process. And instead of sending the exception to an IT person who's a bonder and say orchestrator, actually go to an inbox, a task inbox of that business user in a call center or wherever. And that robot can go do something else because it's so efficient and productive. But once that human has solved that problem, right, that robot or a robot will take that back on and keep going. This human in the loop, human and robot interaction, it doesn't exist today. And we're rolling that out, our UI path apps. I think that's kind of mind blowing. And then when you add a, and I can't go too far into our roadmap and strategy, when you add the app programming layer and you add data science, that's a little bit of a hint into where we're going because we're open and transparent, our data science connection, it's this platform here, this kind of, I'd like to still call it all RPA. I think that that's a good thing. But the reality is this platform, this TAM, this what it can do is nothing like it was a year ago. And it won't be anything like where it is today a year from now. Well, you got the tiger by the tail, Bobby. You got work to do, but congratulations on all the success. It's really been great to be able to document this and cover it. So thanks for coming on theCUBE. Thank you. All right, thank you for watching everybody. But back with our next guest right after this short break. You're watching theCUBE live from UI Path Forward 3 from Bellagio in Vegas. Right back.