Automation Everywhere, One of the best-funded RPA providers with more than $1 billion in capital raised to date, went the debt route this week, securing a $200 million loan from Silicon Valley Bank, SVB Capital and Hercules Capital.
Debt increases aren’t necessarily a bad thing — they’re a useful tool, especially for companies with high annual recurring revenues — but the magnitude and timing of Automation Anywhere’s increase suggests it was more out of necessity than choice.
“This new funding will provide operational capital in the coming years as Automation Anywhere continues to develop its cloud-native automation platform,” CEO Mihir Shukla told australiabusinessblog.com via email. “We are using AI and intelligent automation to design technology that is accessible to everyone — all types of business leaders, managers and citizen developers.”
While Shukla maintains that Automation Anywhere’s business is robust, with a customer base of approximately 5,000 and “more than 50% revenue growth,” the RPA market has long faced headwinds as investors become increasingly skeptical of the technology, which automating repetitive enterprise-level software tasks can deliver on its many promises.
PitchBook notes that shares of UiPath – the main rival to Automation Anywhere, which went public in April 2021 – plunged 71% this year. Meanwhile, another major player, Blue Prism, agreed last September to sell itself to Vista Equity Partners for £1.095 billion (about $1.5 billion).
Gartner predicts that while the RPA market will reach $2.9 billion in early 2023, the growth rate will end significantly lower than in 2021, when the segment grew 30.9% compared to the previous year. Assuming the $2.9 billion figure comes out, this would translate to 19.5% growth between the years 2021 and 2022.