Architect of the New Automation
By Paul Boutin
Published December 7, 2021
Daniel Dines has made a career by ignoring conventional wisdom and pushing forward where others would steer away. His company, UiPath, debuted on the New York Stock Exchange in April 2021 after 15 years in development. UiPath has continued to lead the category of Robotic Process Automation (RPA), which few thought could even become a category when Dines pivoted his Bucharest-based startup toward RPA a decade ago.
But it would be dishonest to claim Dines has done everything right all along. He’s had to grow a lot as a CEO and as a person, both to succeed and to endure setbacks. On a Zoom call from his office in Manhattan, the transplant from Romania lives up to his reputation as both humble and blunt. He shrugs off his new wealth: “I was lucky at some point to realize the true value of money—what money can buy, what money cannot buy.”
The hot category no one knows
You’re forgiven if you aren’t familiar with RPA, an AI-powered leap beyond the traditional boundaries of automating one application at a time in a workflow. RPA tools sit outside the apps on a worker’s screen but can interact with all of them, without even needing API access. RPA software can observe a worker’s repetitive tasks and learn to perform them—extracting invoices from email and entering them into a billing system, responding to customer service requests with the correct help in an instant, sorting through résumés from multiple sources and pre-screening applicants for recruiting.
Moreover, an RPA system isn’t limited to one human subject at a time. It can scale to track a thousand call center workers and correlate their behavior, finding common patterns and optimal paths to automate and remove every possible waste of their time. Dines is especially proud of an instance in which UiPath saved hospital nurses three hours a day of clicking and typing so that they could spend more time taking care of patients rather than filling in paperwork. In terms of potential impact on the future of work, in just a few years RPA has gone from obscurity to drawing comparisons to the first steam engines, taking vast swaths of repetitive labor off human hands.
Right about here is where automation critics chime in: You’re taking away people’s jobs. You’re pushing humans aside for machines. Dines has heard every possible argument against RPA and is having none of it. “I’m far from seeing this machine-takes-over-the-world type of scenario,” he responds. Rather, “in every job, the portion that’s automatable is not the whole job, or even the largest part.”
Moreover, he says, the past two years of pandemic-driven shifts in work have brought about a previously unthinkable shortage of human workers. “We are living in a world where we don’t have enough people to fill the jobs,” he says. “In most developed countries, the population is aging. They bring robots to cope with the large number of people who retire from their jobs, not having enough people to replace them.” Like those nurses, automation doesn’t replace them but rather makes them more available to do the work that only they—not a machine—can do.
Dines believes RPA will also accelerate a 21st-century shift in how society views work in the first place. “Automation is one of the best ways to cope with changing the mentality of people,” he says. “We are trapped since the invention of agriculture into this routine of menial, repetitive tasks. Everyone’s job includes their share. By eliminating those, we are changing how people deliver work.”
The current backlash against mundane work goes hand in hand with RPA, in his view. “New generations won’t sign up for the same kind of routine work that their parents and grandparents were doing,” he predicts. With endless rote tasks out of the way, “people have more time for communication, strategizing, and for aligning themselves.” He has plenty of stories of corporate workers whom RPA freed up to leap from data-entry drone to insightful innovator. By automating as much away from everyone’s work, he says, “I think companies will work better, and that’s true for everyone in the company.”
“I was lucky at some point to realize the true value of money—what money can buy, what money cannot buy.”DANIEL DINES
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Big ambitions from Bucharest
Dines grew up in Romania. A few years after earning a masters in computer science and working locally, he landed a coding job at Microsoft in Seattle. Flying to America to learn English and enterprise-grade software engineering at the same time, he spent four years at Microsoft before returning to Bucharest in 2005 to start a company of his own from his apartment.
Marius Tîrcă, whom Dines hired as an engineer in 2005 and promoted to co-founder & CTO of UiPath a decade later, says even at their first job interview, young Daniel stood out to him as both smart and curious. This made working for Dines both inspiring and aggravating. “I remember going to him to show my latest accomplishment and expecting to impress him,” Tîrcă recalls. “But he always found something that could be improved. Most interactions gave me headaches in the beginning because of how intense he was, but he also motivated me and forced me to get better.”
Dines and his handful of hires began with tech outsourcing, then pivoted to toolkits for other developers, seeking a market in which to grow rather than simply survive. Yet it was a full decade before Dines discovered the emerging field of RPA. He saw what looked like a chance to be an early mover and front runner in an upcoming area that hadn’t yet been gentrified by the software industry’s megabrands. Investors agreed, funding the new UiPath with $1.6 million in seed money in 2015—enough to move into a real office.
Luciana Lixandru, a Sequoia partner who met Dines in her previous role at Accel which led UiPath’s A and B rounds in 2017-18, says that to a fellow native of Romania, Dines’ scale of ambition stood out. “Not a lot of people from Bucharest would think that they were going to change the world and build an iconic company,” she says. “No one before him did it. Probably a lot of time will pass before someone else will do it.”
Dines is quick to dismiss the impression that he founded UiPath to remake the planet. “When I started this company, my main goal was to create a place where I and the people that I work with will be happy, will build innovative products, and will do the best—without the pressure of bosses, managers, or corporate bureaucracy. Changing the world came a bit later as we evolved into building our product.”
For all his future-of-work opinions, he insists his focus is still on the nuts and bolts of RPA. “I don’t think people who chase changing the world are successful,” he says. “To me, changing the world is a byproduct of doing the right thing—building a great company and a great product that the customer loves. At some point, we found that we were changing the way people work.”
“When I started this company, my main goal was to create a place where I and the people that I work with will be happy. Changing the world came a bit later as we evolved into building our product.”DANIEL DINES
Sequoia partners show a fondness for Dines. “You just want to like the guy,” says Carl Eschenbach, who Dines passed over for UiPath’s B round, yet who persisted until Dines came around to going with Sequoia for round C in 2018. “Daniel has always been about humility. It’s very important to him—his humble beginnings, where he grew up, how he got to where he’s at. You could see that in him no matter what he did.”
But Sequoia’s partners were once wary of what seemed a lack of operational rigor in Dines’ leadership. Eschenbach describes Dines’ attitude in earlier days as, “I just want all my employees to be happy. They can travel. They can go to dinner, they can expense a bottle of wine at dinner. It’s OK, I want them to experience life as part of UiPath. Just do what they want.”
Dines also supported rapid hiring, in a land-and-expand approach to setting up UiPath offices around the world, growing to approximately 2800 employees in more than 30 locations. “It was clear that UiPath has the best support for customers on a global basis compared to other market players,” Eschenbach wrote for a Q&A on the company’s website in 2018. “UiPath’s global footprint at this stage of maturity is extremely impressive.”
Yet Dines’ permissive attitude allowed runaway spending to bloom, enough to offset its fast-growing revenue. The issue came to a head in 2019, when Dines accepted that he had to do the last thing he’d ever wanted: Let go of hundreds of UiPath’s staff.
The layoffs are still an obviously awkward topic for him on Zoom. “To fire people was always the most difficult part of my job,” he says. “Firing hundreds of people was terrible in many aspects. The lesson for people that have never done this: First of all I hope they will never be in a position to do this.”
“Second,” he cautions aspiring CEOs, “we didn’t cut deep enough. I think it cost us another quarter or two of not being a very efficient company.”
That misstep came back to bite him half a year later, when 2020’s unending stretch of coronavirus pandemic shutdowns and slowdowns forced Dines to make a second, smaller round of cuts that he’d avoided before. “Covid was the forcing function that made us look very deep into the company,” he says. “We could have done it earlier if it were not for my apprehension about doing what’s right for the company.”
A year later, Dines visibly wrestles with the topic. He comforts himself that letting people go was better than keeping them hanging on in jobs that weren’t going to work out. “Don’t be cheap,” he adds, “so they have enough time to land better jobs.” Yet he also cautions that keeping too many people on is the wrong kind of generosity. “You need to cut once, deep enough to solve the problem, and then move on,” he says in hindsight. “When you do something with which you are not comfortable, you have to recognize this and do more than you are comfortable with. For me the most uncomfortable thing was to fire people.”
As it turned out, streamlining and rethinking his organization set up UiPath for the booming demand brought by the pandemic. As 2020 wore on, one major firm after another gave up its plans to bring workers back to their old offices, and many senior employees left entirely. In this distributed and smaller workforce, RPA became a valuable tool for making it possible to get work done at all. UiPath and its competitors saw a surge in sales. Analysts forecast that RPA spending would continue to grow both during and after the pandemic, with an IDC report citing “changed expectations and priorities.”
RPA’s blossoming as a critical category made it possible for UiPath to go public and Dines to switch back from cutting to growing. Today, Eschenbach says Dines has come out of the experience with a new appreciation for operational rigor. “With the ups and downs and challenges, he was very steady through the highs and lows,” says Eschenbach. “He’s hired very senior people who know what they’re doing and do it well. They sometimes have a little more bite to them. As a CEO, he’s learned to recognize his weaknesses and surround himself with strength.”
Tîrcă has watched his co-founder and chief grow personally as well as professionally: “He started listening more than preaching. I could see him adopting traits of different people who got close to him. His best quality from then to now that helped him survive and grow as a leader remains his curiosity.”
Nobody’s humble enough
Prodded as to what UiPath’s website means when it touts Humility as a core company value, and what his colleagues mean when they say he’s humble, Dines lights up with a smile. “We are not humble,” he says. “Nobody’s humble enough. Humility is a cultural framework—it’s an aspiration. People who have in mind that they have to be humble are better people, better employees, better at anything. It’s like going to the gym—you need to practice every day.
Actually, Dines’ humility is easy to spot: He’s confident, but not full of himself. He’s blunt, but not dismissive. He sees his work as important, but no more than what it is—he can relieve you from grunt work, but you’re the one who’ll go on to make better use of your days.
His advice for aspiring founders is down to earth: Don’t do it unless you truly love the daily work, of which there will be a lot that can’t be automated. “I see people who are inspired by the glamour of the CEO,” he says, gesturing to the Park Avenue view behind him. “And by big valuations. But this is not the end goal—I cannot say it loud enough. Building a great company is not the goal in itself. I know it’s cliche, but if you don’t have passion for what you are doing, you cannot sustain the hardship along the way.”