Sramana Mitra: If you can get a concept validated and moving to some extent, you can sort of do the very early stage in Central Europe. You can always raise more money and set up a second headquarters here in Silicon Valley and get that access. The bridge between India and Silicon Valley has become really powerful.
There are a lot of companies who are operating in this mode. I just don’t see any reason why Europe can’t do that or replicate that. It’s not as solid. The European connection to Silicon Valley isn’t as solid as the Indian connection, but it should be.
Ondrej Bartos: I agree with what you said. Truth is that globalization is progressing. In some places, startups are more likely to be a successful enterprise software company. In some other places, it’s more likely to build a successful consumer play. I totally agree that it’s possible.
Sramana Mitra: Tell us when you saw this company? At what stage? What did they have? What caught your attention? What did it go on to become?
Ondrej Bartos: I like talking about that story. I first met the founder of UIPath, I believe, in January 2015. At that point, UIPath was really just 10 people in a dodgy Bucharest apartment that had interesting technology that they were selling as an SDK or as an installed software with a perpetual license. But it was very well-designed and it worked really well. That was one part of the story.
The other one was that the two founders seemed to be two of the most passionate and nicest that I’ve met. The combination of those two things plus looking at the market, we thought that it was really great timing for automation software of that kind.
Sramana Mitra: Can you talk a bit about what it means so that people can have the context?
Ondrej Bartos: So, they do what’s called robotics process automation. They use software to automate repetitive mundane tasks in organizations, mostly large ones. Think of it as software robots that can perform tasks that are usually still performed by people but shouldn’t be because they’re repetitive. Software can do them much better and efficiently than people.
Sramana Mitra: Were they already doing that for some enterprises?
Ondrej Bartos: Yes. They weren’t doing it on the scale they’re doing it now. They’ve already had some customers and they had a couple of hundred thousand dollars in revenue. As I said, it wasn’t recurring revenue. It was perpetual licenses and some revenue from SDK sale.
So we invested in the summer of 2015 in a $1.6 million seed round together with Earlybird and Seedcamp. Earlybird is another Central Eastern European VC. Seedcamp is probably one of the top seed funds in Europe. Only in the fall of 2016 did they actually turn the business into SaaS. Only after the investment did they start to generate recurring revenue.