What UiPath Layoffs Mean For Robotic Process Automation Industry

Daniel Dines UiPath

When UiPath recently announced 400 layoffs recently (about 15% of their entire workforce), it came as shocking news. That’s because the company had recently raised $568 million in its Series D round of funding at a valuation of around $7 billion. The incident has been compared to the WeWork debacle, a sign of hype and overvaluation of multi-billion dollar startups who are not showing the promised results. 

According to reports, the company has probably burnt too much of its cash on marketing and not enough on driving business. Regardless, the company’s overall financial health is good and it’s still growing at a healthy rate — at $300 million annual recurring revenue — given it’s a market leader of a much-anticipated technology. 


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What Was Behind The UiPath Layoffs?

Daniel Dines, the CEO of the New York-based RPA company said it is focusing more on achieving efficiency across different geographies. The company clearly hyped its offerings far too much in the last year in a bid to capture the market — which it did successfully. But the fact that the company sees its CRO and CFO exits makes it very clear there may have been some mismanagement when it comes to the huge cash pile the company collected in the last few years. The event seemingly highlights the dire situation where startups are overvalued among a slowing global economic growth.

The result is a possible dent in UiPath’s image in investors’ eyes, and possible exposure of a market which hasn’t matured enough. Daniel Dines still say the company has a 50% more people hired than in January 2019.

According to experts, RPA will still add tremendous value to the business world by getting rid of redundant efficiencies. Of course, no single technology would win in isolation and RPA will need artificial intelligence and analytics to find wider adoption. 

Analysts Baffled With The UiPath Announcement

The news was shocking as it came in the wake of the recent Las Vegas event costing the company about $8 million. Analysts jumped quickly to highlight how UiPath, a company that solves redundancies for others created the same for itself through the hype and overpromise in business outcomes. 

While some have lashed the company on social media, most analysts say the company needs to grow responsibly and be careful about hype. At the same time, rival RPA companies like Automation Anywhere offered job opportunities to those laid off, suggesting the market is still going well. 

“UiPath hyped a market that simply wasn’t there. Now we must build one that’s real – one we can trust,” wrote Phil Fersht, Founder and CEO at HFS Research. 

“Personally I don’t think the RPA market is facing a crisis, just look at the amazing success stories and benefits it has brought to businesses. I feel that any organisation in an emerging tech market needs to grow responsibly and are careful not to over hype,” wrote Harrison Goode, Co-Founder of Edge Tech Headhunters on his LinkedIn. 

“Either way, it’s a shame that so many people are out of work because of this. If you worked for UiPath and have been affected by this then feel free to reach out. We have a number of opportunities in the RPA space right across the globe,” Harrison further added. 

Is The RPA market Overhyped?

RPA is cited as a very crucial technology for businesses even though researchers have suggested how business executives have found a lack of clarity in its applications. Regardless, according to most analysts, leading players in the market – UiPath, Automation Anywhere and Blue Prysm have booked strong year-on-year growth rates. This suggests that layoffs are more to do with the challenges of scaling a company in a nascent technology in tune with the shifts in the overall market. UiPath reports that there are still 90 openings for the company, particularly in tech and engineering roles, which is a positive sign as well.


While UiPath may continue to play a prominent role in the RPA market, it will need to be more careful about its strategy and accountability to investors. Also, as RPA becomes commoditised and UiPath faces further competition from other companies, it will have to enhance its products and services.The organization may also need to guide businesses find value and use cases, which are not merely limited to 10-20 process bots but extend to business analytics as well.

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Vishal Chawla
Vishal Chawla is a senior tech journalist at Analytics India Magazine and writes about AI, data analytics, cybersecurity, cloud computing, and blockchain. Vishal also hosts AIM's video podcast called Simulated Reality- featuring tech leaders, AI experts, and innovative startups of India.

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