RPA, or Robotic Process Automation, was already a hot trend through 2019 and into 2020, then the pandemic hit. Remote/distributed work set in and in many cases will be sticking around. This new way of working is forcing businesses to adopt new technology to help streamline the operations of their business and make sure that their employees have access to the information they need to perform their jobs, even when they are all stuck at home. Automation is the hot new trend sweeping through SaaS highlighted by some recent funding rounds and some acquisition interest from some major players.
A wave of new startups are pushing the automation trend and attracting the eye of investors. Recent funding rounds and increases in new customers and revenue from HyperScience, Olive, and Spruce have underlined a trend for a push into new automation technology. The primary focus to date has been around document automation that is specific to industries. HyperScience bring insurance claim automation to the table, while Olive is going after the healthcare and hospital market, and Spruce is chasing down the real estate space. The big key here is that these startups found the pain point in a specific industries document procurement procedure and automated it (check out our blog on Focusing Till it Hurts, these companies clearly all read it 😜). The big question that will remain is as they scale, are they able to branch into other industries and find new operational processes to automate and continue to build new services and with that new revenue. Another possibility will be M&A activity as the winners start buying up the other players and acquiring their tech and domain expertise in specific industries.
The second set of news underlying this trend comes in the form of an established giant of the SaaS industry indicating their interest in making an acquisition in the automation space, enter Salesforce. According to a recent article on Business Insider (you can read it here but unfortunately you need their premium subscription), Salesforce is looking around to make an RPA (Robotic Process Automation) acquisition to add automation to their platform of products and services and you can see how for businesses that still rely on paper documents, adding that functionality to bring that data into their existing Salesforce suite of products could vastly help improve operational efficiency.
From both the new startup and VC investment side to the M&A potential of an industry leader, their is a clear trend emerging for automation in our digital world. The awesome news out fo all of this is the opportunity for entrepreneurs to build something new that capitalized on this need. It will be interesting over the next 36 months to see what other industries automation software emerges for and what problems they are trying to address. If I was at a VC or PE firm I’d keep a ear to the ground to listen for emerging new RPA/Automation startups as we are ripe for disruption.