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馃槻 UiPath Stock | Cathie Wood Buys THIS for ALL ARK Invest Funds - YouTube
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skynet will one day be real and this
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company is
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exactly where it starts probably in a
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recent episode i talked about
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arkhanvest's view on workers losing jobs
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to automation
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looking back i realized i missed an
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important point
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my goal was to identify all of the
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industries that could be disrupted by
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robots
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dangerous jobs like arc welding tedious
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jobs like warehouse part picking
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and unpaid economic activities like
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unskilled farm labor
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home cooking and driving yourself around
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the thing i missed was the vast amount
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of jobs that could be replaced
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purely by software so in this episode
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i'd like to talk about a single company
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that could automate more work than all
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of the robots i just mentioned
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put together and grow by a crazy amount
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in the process
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if you enjoy this type of commentary and
[46]
analysis consider liking this video and
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subscribing to the channel
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with all notifications turned on that
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way you'll be the first to know when i
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come out with new research
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regardless of how youtube tunes its
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algorithm let's get right into it
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uipath ticker symbol p-a-t-h is a
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software company
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that focuses on rpa or robotics process
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automation uipath defines rpa as a
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software technology that makes it easy
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to build
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deploy and manage software robots that
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emulate human actions
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interacting with digital systems and
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software so let's start there
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one thing uipath does is make software
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bots that replace work being done by
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humans
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through automation you're probably
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already familiar with certain types of
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online software bots
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for example chat bots are the bots that
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you find in the bottom right hand corner
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of your browser
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on many websites today the goal of a
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chat bot is to simulate a conversation
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with a human being to answer frequently
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asked questions and direct you to useful
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resources
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eliminating the need for a human
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employee to be doing that
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web crawlers are bots that access
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websites and gather content to be
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indexed in search engines
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basically they read every website they
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can get to and do things like figure out
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what's on it
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how up to date it is where it links to
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what other sites reference it
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and how fast it loads as well as many
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other things that help a search engine
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like google
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know when to put it in front of someone
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imagine giving that job to a human
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uipath spots are often used to manage
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simple but monotonous workflows like
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these
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an example workflow for uipath spots
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could be parsing emails to retrieve data
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that need to be entered in a bunch of
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other forms and applications here's what
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daniel dines
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uipath's ceo said in his s-1 letter to
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shareholders which you can find in the
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description below
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as the economy largely moved from
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manufacturing to services
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the need for automation shifted from
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industrial to business
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process automation but despite enormous
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gains in computing power at our
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fingertips
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we witness a paradox while today's work
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is largely digital the repetitive
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manual work has not disappeared the form
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of it has simply shifted
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today's knowledge worker spends a vast
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amount of his or her time
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at work extracting entering and
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processing data
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and enduring the drudgery of
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continuously copying and pasting
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between a growing number of applications
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let me know in the comments below how
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much time you spend at work
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on repetitive manual tasks is it
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something like 10 percent of your work
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day
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20 50 or more do you think some or all
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of those tasks could be automated
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i'm excited to hear your thoughts for me
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this is the quote that made me realize
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my mistake from that previous episode
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when i think about robots my brain jumps
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to manufacturing
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and industrial applications when daniel
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dines thinks about robots
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he's thinking about emails spreadsheets
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and forms actually he's thinking about a
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lot more than that
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uipath has developed an entire suite of
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tools for building and managing these
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bots
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not just the bots themselves their
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platform incorporates different
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capabilities like computer vision
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and natural language processing which
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lets people create more advanced
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automations with little to no code
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as i mentioned earlier the goal here
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isn't only to put an end to repetitive
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tasks
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but to fully emulate human workers at
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least in some roles
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and that's where things get really
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interesting the introduction of the
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shareholder letter
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ends with this while we are still in the
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early days of a multi-year journey to
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the fully automated enterprise
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momentum is growing as organizations
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across the world
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only now are beginning to understand the
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power of automation
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the idea of the fully automated
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enterprise is why i think this company
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is so attractive to arc invest let me
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walk you through what i think they
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ultimately see in uipath
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when they look at least five years out
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each week arc invest comes out with a
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newsletter called arc disrupt where they
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highlight technological breakthroughs in
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bite-sized chunks
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in issue number 265 which came out about
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a week before uipath's ipo
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arkhamvest talked about openai's
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language model
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generating 4.5 billion words per day
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across over 300 different commercial
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applications
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here's the part that's relevant to
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uipath with 175 billion parameters
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trained on roughly 500 billion words the
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model uses deep learning for a diverse
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set of text generation tasks
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given a list of ingredients for example
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gpt 3 can generate a recipe
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alternatively it can serve as a chat bot
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guiding customer support or turning text
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commands
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into sql code arc invested big ideas
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report also talks about gpt3
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here's a list of things this same ai can
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do write emails design web pages
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write code in a dozen computer languages
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retrieve historical facts
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translate languages diagnose diseases
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talk like a therapist
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and more the same ai is able to do these
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things for the same reason a single
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human can do them
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because it's trained to understand
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language in general
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and just like with a human the list of
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things this ai will be able to do in the
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future
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will continue to grow when i was in grad
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school the notion of a general purpose
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ai
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seemed like science fiction it's cool to
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be talking about it for real
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just a few short years later i'll leave
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a link to that issue of the arc disrupt
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newsletter
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and their 2021 big ideas report in the
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description below as well
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the reason i'm talking about gpt-3 is
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because that same big idea
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a general purpose ai that's trained to
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understand workflows instead of language
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no longer seems so far out of reach
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uipath's vision of the fully automated
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enterprise
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could be realized even sooner than they
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expect according to their latest
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investor presentation
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that's around 2028 the amount of
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artificial intelligence-based
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automations
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and innovations uipath offers has
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continued to grow
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exponentially year after year what if
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they could build bots that discover the
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processes within an organization
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that can and should be automated
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software bots that build
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software bots to target the most
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monotonous jobs
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currently being done by humans that's
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where i believe uipath is headed and
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daniel dines
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says as much in his shareholder letter
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uipath's mission is to unlock
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human creativity and ingenuity by
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enabling the fully automated enterprise
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and empowering workers through
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automation they currently have task
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mining and discovery tools in public
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preview
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which they expect to release later this
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year they're putting themselves in a
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great position to gather the mountains
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of data it would take
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to train that generalized workflow ai
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allowing them to automate more and more
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processes
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for their existing clients and capture
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different types of new clients in the
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future
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just like tesla is doing with millions
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of cars in thousands of environments
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and teledoc is doing with millions of
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patients in thousands of medical
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conditions
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uipath that could be doing this with
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millions of software bots across
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thousands of different workflows
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workflows that touch every kind of
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industry
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and innovation from genomics to space
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that's how the same company winds up in
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arcg
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arc invests fund themed around genomics
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and arc
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x their fund themed around space
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exploration uipath's total addressable
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market is just
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that big let's hope they never flipped
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the switch and caused the robot uprising
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i'm just kidding now that we have a
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basic feel for what this company does
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and where it could be headed let's talk
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about their financials
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and the stock itself arc piled money
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into uipath
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ticker symbol p-a-t-h the day it ipo'd
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which was april 21st
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2021. kathy wood grabbed almost 200
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million dollars worth of shares on day
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one
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roughly three weeks later on may 14th
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ark's combined position in uipath was
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over 400 million dollars
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and as of last friday june 11th it was
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over 600 million dollars
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making it arc invests 20th biggest
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position overall
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that's almost the same level of growth
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as arkhamvest's now massive position in
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coinbase
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ticker symbol c-o-i-n which ipo just one
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week before a uipath
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indicating a massive amount of
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conviction in the long-term performance
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of the company
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if you want to see my analysis of
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coinbase stock i'll leave it in the top
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right hand corner of your screen right
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now
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and in the description below to me it's
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obvious that there is
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and will continue to be an insane amount
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of demand for robotics process
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automation
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every company wants to automate
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workflows and reduce unnecessary human
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labor
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the real question i have is whether
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uipath can scale
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to meet that demand before its
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competition does now that they've
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released their latest earnings report
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we can find that out let's start with
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the numbers in daniel dinez's letter to
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shareholders their annual recurring
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revenue jumped from 351
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million dollars to 580 million dollars a
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jump of 65
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their total revenue went from 336
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million dollars
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to 607 million a jump of 81
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their net losses went down from 520
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million dollars to 92 million dollars
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a reduction of over 80 percent they had
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over 6
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000 customers as of january 31st 2020
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including 80 percent of the fortune 10
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and 61
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of the fortune global 500. as of january
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31st
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2021 they had just under 8 000 customers
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a jump of about 33 percent
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while still including 80 percent of the
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fortune 10 and
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63 of the fortune global 500 meaning
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they're expanding their footprint
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and the total addressable market beyond
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industry titans
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while having relatively little customer
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churn how is uipath doing this
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uipath is becoming entrenched in their
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customer base
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that's the growth model uipath lands
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their clients and then expands
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the company gets in the door and over
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time dramatically expands its business
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as it proves the value of the technology
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to the customer
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uipath's dollar-based net retention rate
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is 145
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meaning their customers increase their
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spending with uipath
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by an average of 45 percent year over
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year
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that isn't just some on paper number
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this is happening because uipath
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grows as their customers identify and
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expand the number of business processes
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they can automate
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increasing the number of robots deployed
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and the number of users
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interacting with those robots guess how
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uipath charges its customers
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per automation and per user that's your
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exponential growth
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so what about their competition well it
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turns out there isn't much
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here's what daniel dines had to say
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during their most recent earnings call
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our leadership position in the rpa
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market is again demonstrated with our
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arr growth which increased by 64 percent
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year over year
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to 653 million dollars while net new ar
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hit a record 72 million we continue to
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grow multiples of the market and take
[669]
market share
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in fact for 2020 ibc announced that
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uipath ranked
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number one in rpa capturing eight points
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of market share versus 2019.
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in gartner's latest market share
[680]
research uipath added more revenue in
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2020
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than their top nine competitors combined
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we believe that automation
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will be the next layer in the software
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stack and we are not standing still
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as we continue to expand our competitive
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moat our ultimate product vision is for
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our user to not only automate existing
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processes
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but to design processes on our platform
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think about what he's saying here
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eventually uipath will become part of
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the foundational technology stack
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that companies are built on and instead
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of automating existing processes
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companies will be able to design them
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from scratch on uipath's
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process automation platform this is a
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really big idea and the possibilities
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here are endless
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not all aspects of the earnings report
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were this great the gap
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net loss was greater than expected at
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about 240 million dollars but the
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company had a positive non-gaap
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operating income of 16 million dollars
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this was the result of a massive
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stock-based compensation
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of about 250 million dollars much higher
[740]
than their revenue
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i personally don't see this as a problem
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in the long term the company just went
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public and it's normal
[747]
for high-tech growth companies to
[748]
compensate their talent pool through
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stocks
[751]
as long as we see this number shrink
[752]
year over year it's a non-issue to me
[755]
i'll leave a link to their earnings
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report and transcript of their latest
[758]
earnings call
[759]
in the description below but i think
[761]
their exponential growth trajectory
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and market dominance is very clear the
[765]
enterprise robotics process
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automation market is just beginning
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meaning the market itself is going to
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grow
[772]
and uipath is setting itself up to be
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very sticky
[775]
meaning clients will have to do a lot of
[777]
costly work to switch to a competitor
[779]
down the road
[780]
a good rule to remember is when you're
[781]
competing with an existing solution your
[784]
solution has to be
[785]
much better to get people to switch if
[787]
tesla wants its full self-driving
[789]
capabilities to hit mass adoption
[791]
it can't just be five percent safer than
[793]
a human driver it needs to be fifty
[795]
percent safer
[796]
if not much more if another competitor
[798]
comes in after that
[799]
they're trying to displace tesla's
[801]
market share not just human drivers
[803]
the same is true for uipath their future
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competitors will need to show much more
[807]
operational efficiency
[809]
than uipath's existing automations to
[811]
get clients to switch
[813]
not just that they're more efficient
[815]
than human workers themselves
[816]
uipath's business model of getting in
[818]
the door expanding their footprint
[820]
and building deep trenches in their
[822]
customers processes means that they're
[824]
capturing
[825]
more and more customers in that growing
[827]
market and
[828]
more and more of those processes per
[830]
customer today
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they already have stable recurring
[833]
revenues of over eleven hundred
[835]
customers
[835]
spending one hundred thousand dollars
[837]
per year each and one hundred customers
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spending over one million dollars per
[842]
year with them each
[843]
in the future they expect the fully
[845]
automated enterprise market
[846]
to be valued at 60 billion dollars per
[848]
year but one thing i don't think a lot
[850]
of people are talking about
[851]
is the small and medium-sized business
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opportunities as well
[855]
as software bots for individuals as
[857]
their ecosystems
[858]
increase and their costs continue to
[860]
decline i think their final total
[862]
addressable market
[863]
could be much bigger i'd love to
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automate several different workflows in
[866]
my own life
[867]
and i'd happily pay something like a
[869]
thousand dollars per year to do it
[871]
in fact one such automation is with a
[873]
partnership they just expanded with
[874]
tableau
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according to their most recent earnings
[877]
report uipath and tableau
[879]
launched tableau activity which allows
[881]
customers to easily utilize data
[883]
produced or retrieved by robotic
[885]
automations in their tableau reports
[887]
and the uipath extension for tableau
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which triggers a robot directly from a
[892]
tableau report or dashboard
[894]
tableau which is now owned by salesforce
[896]
is a premier data visualization tool
[898]
used in many different industries
[900]
it's also the tool in which i share my
[902]
visualizations of arc invest data like
[905]
the ones i used to highlight how kathy
[906]
would
[907]
load it up on uipath earlier this
[909]
episode i spend about an hour a week
[911]
updating these dashboards and another
[913]
hour manually looking at the data in
[915]
different ways
[916]
i'm sure one of you ipad spots could
[918]
save me a hundred hours a year
[920]
inside tableau alone let alone the other
[922]
spreadsheets i'm constantly putting
[924]
together for this channel
[925]
i can't imagine how many hours uipath
[927]
could save
[928]
some of its biggest clients over a year
[930]
and that number will only continue to
[932]
grow
[932]
by the way if you want to dig into arc
[934]
invest data for yourself instead of
[936]
hoping i cover something specific in a
[938]
future episode
[939]
these interactive dashboards are now
[941]
available to my patrons on patreon
[943]
and members right here on youtube how's
[945]
that for a smooth segue but seriously i
[948]
hope this episode helped you learn a
[949]
little bit about the growing market for
[951]
robotics process
[952]
automation uipath's dominant and quickly
[954]
growing position in that market
[956]
why it's the only company to be in all
[958]
six of arkhanvest's actively managed
[960]
funds and how it totally won't be
[962]
responsible for the robot apocalypse
[965]
if i did let me know by investing in the
[968]
like button and subscribing to the
[969]
channel with all notifications turned on
[972]
that's a great way to invest in the
[973]
channel that invests in you
[975]
until next time this is ticker symbol
[977]
you my name is alex reminding you
[979]
that the best investment you can make is
[982]
in you
[996]
you
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