Mihir Shukla (on l) and Ankur Kothari
One of India’s premier business newspapers, Economic Times, recently profiled Automation Anywhere, a tech start-up that is now “one of the superstars of robotic process automation (RPA).
Three of the four founding members –Mihir Shukla, Ankur Kothari, and Neeti Mehta – have roots in Palanpur .
We reproduce the article for the benefit of PO members.
A unicorn you haven’t heard of is changing India’s tech business (OR Bot, Off the Shelf)
Automation Anywhere, founded by four Indians and backed by blue-chip investors, has quietly emerged as one of the superstars of robotic process automation. Its playbook offers a peek into what a globally competitive Indian-origin multinational might look like in the AI-led digital era.
By Malini Goyal
ET, June 13
Automation Anywhere (AA) doesn’t easily ring a bell.
In India’s startup world, where entrepreneurs turn superstars overnight, the founders of AA — a robotic process automation (RPA) firm that makes software bots to automate business processes — aren’t household names. Yet, the 15-year-old company, started by four Indians with roots in Vadodara and headquarters in California, has been grabbing headlines and raking in profits with robotic consistency.
AA is counted among the hottest and fastest-growing companies leading the RPA wave globally. It has not just grown rapidly — in triple digits — but has recorded profits for the last seven years-plus. Not surprisingly, investors have lined up with top dollar.
Last year, AA’s Series A fundraise of USD550 million from big-bulge investors counted among the top 10 venture rounds in the US. Bootstrapped until then, the company’s valuation has been surging. In July, it raised USD250 million from investors like New Enterprise Associates and Goldman Sachs Growth Equity, valuing it at USD1.8 billion. In November, it landed another USD300 million from SoftBank Vision Fund at a valuation of USD2.8 billion.
“We had an amazing story to tell. We have fantastic top-tier investors. We are a little spoilt for choices,” says Ankur Kothari, who co-founded the company with Mihir Shukla, Neeti Mehta, and Rushabh Parmani.
Endorsements have come thick and fast. “[With AA’s offering] anyone can build a bot. Its ease of use enables business users to deploy RPA solutions without having to rely on their IT departments,” says Peter Munzig, managing director, General Atlantic.
Despite the impressive credentials, Kothari isn’t quite used to media glare. At the business centre in Mumbai’s The Grand Hotel, even as he reluctantly poses for a profile shot, he requests if we could avoid using his picture. “I am a hardcore engineer. A techie,” he laughs. “My wife is going to rib me on this one.”
For multiple reasons, Kothari and AA’s journey deserves attention. Of course, the startup’s stellar growth is a compelling story in itself. But beyond the numbers, the AA founders’ rise marks the arrival of a new breed of Indian software-as-a-service (SaaS) entrepreneurs on the global stage. (Even though Kothari left India in the 1990s right after college, he identifies himself as an Indian entrepreneur and has kept his India links alive).
High on confidence and ambitions, these entrepreneurs often straddle two worlds. Tapping into their Indian roots while leveraging their Silicon Valley networks, they are making the most of the two geographies to build globally competitive businesses for the digital era. In doing so, they are moving beyond the labour-cost arbitrage model that helped build the earlier wave of IT outsourcing giants like TCS, Infosys, and Wipro.
More important, as startups like AA expand their global footprint, their organisational construct offers a peek into what a globally competitive Indian MNC might look like in the AI-led digital era.
The digital-worker factory
“The product-company mindset is very different from the services mindset. In the latter, customers tell you what to do. In the former, you have to be a disruptor and tell customers what to do,” says Milan Sheth, executive vice-president (IMEA and RoW), AA Digital Workforce.
What exactly does AA’s tribe do? In one sentence, it is cheerleading the era of invisible bots or digital workers — intelligent assistants that can automate specific job roles by thinking, analysing, and acting the way humans do. Think of them as software robots that can handle high-volume, repeatable tasks such as preparing reports and reconciling records like monthly sales, expenses, inventory status, and medical records.
“As companies transition from legacy software to modern software, different systems within an organisation continue to operate in silos and talk to each other only through people,” says Kothari. “We looked at the problem and wanted to ask if we could develop a way where software could mimic human behaviour. It was a problem we fell in love with.”
While automation and digitisation has been happening for some time, what is different about the likes of AA and their robots is that bit about mimicking human behaviour.
Consider for example Melbourne University, an AA customer that gets thousands of applications every year. AA’s bots have not only helped it automate the application process but also generate valuable analytics and insights. “They now know their students much better,” says Kothari. With the knowledge of student demography, background, popular courses, dropouts, etc., “the university is now working on improving its entire experience. Scaling too is so easy with it,” he says.
“Its ‘IQ Bot’ layers in AI and machine learning for more complex decision-based tasks,” adds General Atlantic’s Munzig.
RPA is today a USD50 billion addressable opportunity. Consulting firm Zinnov estimates enterprises to have spent USD2.3 billion in FY19, a figure that is likely to grow to over USD11 billion by FY24, making it one of the fastest-growing enterprise software plays globally.
Last year, AA rolled out its bot store. It is like an app store, where one can pick pre-built bots or digital assistants with specific profiles or personas. Say you are an HR head. Besides HR-automation software, you can also download bots like Digital Recruiter (helps with vetting résumés and recruiting) or Digital Sourcer (crawls the Web, including platforms like LinkedIn, to source relevant résumés).
With partners like KPMG and Deloitte, AA now has over 500 bots in its bot store. “I was blown away by their conviction and confidence that world-class software products can come out of India,” says Sheth, who quit his E&Y job to join AA.
Will AA’s bots bring the threat of robots taking away human jobs closer to reality? Last year, AA created 1 million digital workers and has plans to grow it to 3 million by 2020. But Kothari expectedly dismisses the job-loss fear. “The fear of automation is extremely overblown. These robots will take out the repetitive tasks, making the work more human,” he says.
View from Silicon Valley
What does it take to lead the charge in a cutting-edge technology like AI? Having a base in Silicon Valley helps.
Says Kothari: “Its environment allows you to think big and global from day one and scale fast.” Shukla, who is based in California, adds: “Within a small radius in Silicon Valley, you get so many software companies and some of the world’s best talent. Failure is celebrated here. We now see the same happening in Bengaluru.”
According to Shukla, the Silicon Valley advantage is that you can see ahead and get an early sense of where the world is headed.
The co-founders’ experiences in product companies also help. Shukla, for example, has worked with pioneering product companies like Netscape in the US. “In that environment, you learn many things like managing fast growth. I can apply those learnings here.”
One key lesson? For any technology or product like the Internet or personal computer, the way to make an impact is to ensure that it works for big and small users (from developers to users to companies), be available on all kinds of devices, and be a global company but locally optimised. So, AA’s product is available in eight languages and can process data in 190 languages.
The India edge
While AA is headquartered in the US, it has a substantial presence in India. Of its 2,200 employees, 744 are in India: 300-odd in Bengaluru and 400-odd in Vadodara.
Why Vadodara? “When we started in 2003, we didn’t want high attrition. Also, Vadodara is an engineering town with good talent supply,” says Kothari. This was also the time when India had few product companies and talent. Familiarity also helped — co-founder Shukla studied in Vadodara. But now, the Bengaluru office is growing rapidly.
“Talent here is comparable to the Bay Area,” Kothari says. The one big difference is the exposure a techie gets in the US, with so many product companies working on cutting-edge technologies.
With offices in 41 countries, AA’s global operations are driven through four regional hubs, but the teams in India and the US are the ones that are truly co-creating, architecting the product, and providing critical support to customers. The company claims its China business is also growing well.
India is an important market too — it accounts for around 30% of AA’s business. “AA was among the first RPA companies that saw India as an automation hub,” says Vijay S Bhaskaran, partner, robotics and intelligent automation, E&Y. The presence of IT-outsourcing biggies and a growing wave of global innovation centres (GICs) owned by multinationals has propelled India to one of AA’s top three markets. “Even when the UK headquarters buys our product, often 70% of the usage happens in their India GIC,” says Kothari.
India Inc. is also rapidly embracing RPA. “Unlike other enterprise software, RPA in India is growing rapidly and already contributes 6%-8% of an RPA company’s global revenue, which is phenomenal,” says Praveen Bhadada, partner, Zinnov.
The bottom line
How does AA maintain relevance in an area that is changing so rapidly? “Be aware that you are three years away from disruption. You fall in love with the problem, not the solution,” says Kothari. Innovation holds the key, so AA’s R&D investment and team is growing rapidly. For example, six years ago it made its first investment in AI. Today, it is AA’s fastest-growing product line. Now the company is investing heavily in mobile and on-cloud RPA.
“It feels like we have just gotten started. Being in a space that’s changing rapidly, I find it edgy, exciting, and full of possibilities,” says Kothari. “China led the manufacturing wave and also its automation. We see a parallel for India in the services space. Thanks to IT outsourcing, India has played a critical role in standardisation of processes. We have the potential to be the automation capital of the world.”
Flush with capital, AA plans to use it to accelerate growth, push for global expansion, beef up its product portfolio, and pursue M&A deals. The enviable cast of investors backing it also brings a massive advantage: network.
“Say, when we were looking at Korea, both SoftBank and General Atlantic have a vast portfolio and lot of experience,” Kothari says. “Their connection is awesome. They accelerate your learning.”
Automation Anywhere at a glance
Business: Robotic process automation or layering software with AI and machine learning to do high-volume, repeatable tasks otherwise performed by humans
Headquarters: San Jose, California
Started: In 2003 as Tethys Solutions and rebranded as Automation Anywhere in 2010. Its founding team has strong roots in Vadodara
Valuation: US$ 2.8 billion
Investors: Raised US$ 550 million in Series A last year from investors like SoftBank, Goldman Sachs and General Atlantic
Global Footprint: 41 offices in 35 coutnries, with R&D centres in the US, Vadodara, and Bengaluru
Pic and text: Courtesy Economic Times / Automation Anywhere
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