UiPath success rekindles Romania’s unicorn dreams

Sergiu Negut, co-founder of Romanian start-up FintechOS, poses for a portrait at FintechOS headquarters, in Bucharest, Romania, January 18, 2022. Inquam Photos/Octav Ganea via REUTERS

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  • UiPath, Romania’s first unicorn, is now valued at nearly $20 billion
  • Its success inspires entrepreneurs in Romania
  • Several former UiPath executives are investing in new start-ups
  • Analysts draw comparison to Skype, Spotify’s influence in Sweden

BUCHAREST/PRAGUE, Jan 25 (Reuters) – When Romanian software maker UiPath achieved unicorn status as a billion-dollar company in March 2018, Sergiu Negut immediately knew the value of his own startup. -up based in Bucharest had just risen. results.

“We had discussions with investors about the funding round. UiPath had just become a unicorn. tomorrow,” said Negut, co-founder of FintechOS, which was founded in 2017 and builds digital tools for financial services firms.

UiPath, now valued at nearly $20 billion since its IPO on the New York Stock Exchange last April, has transformed the Romanian start-up scene, highlighting the country’s emerging tech promise for global investors and enticing young entrepreneurs to start their own business.

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For FintechOS, that meant a $60 million Series B funding round in April 2021 with investors including Germany’s Earlybird Venture Capital, which also bet on automation software provider UiPath.

“When UiPath became a unicorn, we realized that the perceived value of our business increased overnight because we were part of the same ecosystem and everything became more visible,” Negut told Reuters.

While Central European countries such as Poland and the Czech Republic had established themselves as a hub for tech entrepreneurs, Romania lagged behind.

Romania also had a long tradition of producing strong math and computer science graduates, but until UiPath, distance from major investment hubs, an unstable political landscape and a high-risk perception kept investment at bay. , according to investors and founders.

“I think there’s a ‘UiPath mafia’ out there advising up-and-coming entrepreneurs and making investments,” Luciana Lixandru, a partner at Sequoia who led UiPath’s Series A in 2017, told Reuters, adding that the investment venture capital in Romania has picked up over the past two years.

“Seeing the co-founders and early employees of UiPath succeed is not only inspiring, but they are giving back to the next generation of businesses.”

UiPath’s trajectory can draw parallels with Sweden where the founders and executives of early success stories such as Skype, Spotify (SPOT.N) and Klarna steered investment towards new start-ups.

Backed by Accel, Dragoneer, and Coatue Management, UiPath uses artificial intelligence and low-code tools to help businesses and government agencies automate routine tasks in areas like accounting and human resources.

UiPath veterans, venture capitalists and emerging entrepreneurs in Romania say the software maker’s success is encouraging young entrepreneurs who might not have gotten into business a few years ago.

“While UiPath’s impact on the European talent pool is already huge, the full potential has yet to be realized,” said Sarah Guemouri, director of Atomico in Sweden, an investment firm set up by Skype co-founder Niklas Zennstrom, who has invested in around 100 companies.

“There are exciting times ahead for the Romanian tech ecosystem.”

Seed deals in Romania increased 130% to $24 million in 2021 from a year earlier, according to data from Dealroom.com. That compares with a gain of 84% to $127 million in Poland, a much larger country, and 16% to $12.4 million in the Czech Republic.

UiPath co-founder Daniel Dines, a former Microsoft executive (MSFT.O) who started the Romanian company with a team of 10 people in a Bucharest apartment in 2005, believes his company has changed the landscape In Romania.

“One of the biggest changes we’ve made in Romania and across the region is that the brightest people should consider creating start-ups because it’s a great path to meaningful work and creating significant wealth,” Dines told Reuters.

“There is an influx of money into the region which is significant. No matter what event I attend in Europe, a host of Romanian entrepreneurs will come and tell me that UiPath’ has put Romania on the map. We’re getting higher valuations, and there’s a lot of interest in the area,” they tell me.


A number of past and present UiPath leaders are investing some of their newfound wealth in local start-ups and providing mentorship to promising founders.

Former UiPath HR director Marius Istrate left the software maker in 2020 and now invests full-time in companies such as cloud infrastructure services start-up Bunnyshell and automation developer of recruitment marketing Smart Dreamers.

Former UiPath head of growth Vlad Ionescu, who started investing in 2019 and is now chief marketing officer of retail automation startup Tokinomo, owns a stake in biometrics security company DNA typing, among others.

“The UiPath effect is that there are people who are very good start-up operators, who know how to build departments and evolve, and, having participated in its expansion, they also know how to do it for d ‘other businesses,’ Ionescu told Reuters.

“They can give the ecosystem something they didn’t have.”

Investments in the Romanian start-up ecosystem, excluding UiPath and other large companies, increased from 14 deals valued at around 8.2 million euros ($9.33 million) in 2017 to around 50 transactions valued at €81 million in the first half of 2021, according to Romanian data. venture capital fund GapMinder, created in 2018.

Florin Tufan, co-founder of machine learning database maker Soleadify – which secured $1.5m in seed funding at the end of 2020 and plans to look to the US market for a funding round over the next six months – dozens of companies have investors or advisors connected to UiPath told Reuters.

“There will be several more UiPath-level companies over the next five years,” Tufan told Reuters. “We are now learning from experience and those who follow us will have everything they could possibly need.”

UiPath has also shown young entrepreneurs that starting or joining a new business can pay off big, prompting many to quit their jobs at big software vendors to pursue their own unicorn dreams, said Dragos Bulugean, Founder of UiPath. Archbee, which makes software tools. for technical teams.

“People were just making software for other people and nobody wanted to join start-ups,” Bulugean said. “Now people understand that you can make a lot of money with start-ups.”

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Reporting by Michael Kahn in Prague and Luiza Ilie in Bucharest; Additional reporting by Supantha Mukherjee in Stockholm; Editing by Susan Fenton

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