Its usually at least mildly newsworthy when a large or important or particularly hot company cuts a chunk of its workforce, as UiPath did this week when it cut about 400 jobs from its total of about 3,200. But the timing and optics of this particular round of cuts from this particular company was jarring, especially with the WeWork debacle still fresh on peoples minds.

UiPath is a unicorn, and the sturdy robotic process automation (RPA)-powered steed has been galloping fast. The company added ProcessGold and StepShot to its stable earlier this month, after a fantastical $568 million funding round earlier this year pushed its total funding to over a billion dollars and a $7 billion valuation. It would seem that UiPath has cash to spend, and its recent Las Vegas event, which reportedly cost an estimated $8 million, reinforced the image that the companys coffers overflow.

And then came the job cuts. The timing and price tag of the event makes for poor optics (even though $8 million wouldnt pay 400 people for more than a few months), but on its face its also just rather alarming that a company freshly flush with gobs of cash would need to make cuts of any kind, let alone to a chunk of its workforce.

Shouldnt the opposite be happening? Shouldnt UiPath be on a breathless hiring spree right now? It just doesnt sit right.

A blog post from UiPath CEO and founder Daniel Dines arguably made things worse. The audience for Dines post is clearly investors; he spins the layoffs as a net positive. He confusingly pats UiPath on the back for increasing its workforce by 60% over the last ten months, when its just dumped around 400 of those people, and he wraps up a quick bullet list of good news for the company by saying we will still end 2019 with almost 50% more employees than when we started the year. Its a mite tone deaf for the average reader.

On top of that, theres some in-the-wind concern about cash burn at the company, per an unnamed source cited by Information Age.

And on top of that, the optics of a job-eliminating automation company eliminating its own jobs makes people feel panicky. What if its not a unicorn at all, but an ouroboros, a snake eating its own tail? And what if thats indicative of a larger problem in the RPA market?

Deep breaths. Deep breaths. A good bit of the sturm und drang around these layoffs really does appear to come down to optics and timing (most likely).

(And it is a little unfair to paint companies like UiPath, Blue Prism, and Automation Anywhere as job-eliminating, because although automation will of course displace jobs, it ostensibly will replace them with new ones but thats a topic for another day.)

In an interview with VentureBeat, UiPath CMO Bobby Patrick reiterated some of the general themes of Dines blog post: that these cuts are about getting more efficient as a company, as it pushes towards profitability and potentially going public. UiPath is at the end of its manic push for growth, growth, growth. Its in 30+ countries now, he said, and the company is focusing on becoming more effective, instead of justbigger.

The company is truly healthy, he assured us. Were only going down to 2,860 employees. Thats still amazing growth, he said, echoing Dines. I think the story is that were going to go into next year focused not only on growth, but on productivity and efficiency.

Thats a certain amount of spin, but Patrick also said that UiPath has 90 open job postings which would make up for about 23% of the lost jobs and some are in different areas, like on the tech side of things rather than sales. He also said that the job cuts had nothing to do directly with recent acquisitions and confirmed that none of the jobs were lost due to UiPaths own automation tools. (We had to ask.)

More to the point, Patrick said that UiPaths annual recurring revenue (ARR) is now at $300 million, up from $25 million two years ago.

None of the above speaks to the potential cash burn inside UiPath, nor does it salve the wounds of the hundreds of now-former UiPath employees. But its not unreasonable to believe UiPath when it says that these job cuts are in service of focusing on Act 2 of the unicorns play worrying more about developing long-term sustainability rather than just growth. If thats the case, the cuts could be considered shrewd, regardless of the iffy optics and timing.

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AI Weekly: UiPath wants you to know its job cuts are strategic, despite the optics - VentureBeat