Robotic process automation (RPA) startup FortressIQ today announced that it raised $30 million, the bulk of which founder and CEO Pankaj Chowdhry said will be put toward product research and development. The round comes after the formation of a partnership with Microsoft and a new integration with Power Automate, Microsoft’s workflow automation creation platform, which rebranded and relaunched last November.
RPA — technology that automates monotonous, repetitive chores traditionally performed by human workers — is big business. Forrester estimates that in 2019, RPA and other AI subfields created jobs for 40% of companies and that a full one-tenth of startups now employ more digital workers than human ones. Moreover, Market and Markets anticipates the market will be worth $493 billion by 2022, with a compound annual growth rate of 19%.
FortressIQ’s marquee product is Virtual Process Analyst (VPA), which taps AI — specifically computer vision and natural language processing — to “learn” business tasks as they occur in real time. VPA doesn’t require APIs, transaction logs, or installation to provide insights that aid in the transition from manual to automated pipelines, and it works with existing free, proprietary, and commercial applications.
As Chowdhry explains it, VPA basically replaces high-level human consultants who perform time and motion studies. The cloud-hosted tool captures videos of processes, and AI tools watch the videos and transcribe them into software interactions. Data mining ensures that if the person whose actions were captured became distracted by another task, the noise can be filtered out automatically.
“Our customers need modern strategies to properly address their top-line goals. In order to properly tackle enterprise challenges, we believe it requires focusing AI where it can be most effective and focusing humans on where they can deliver the biggest impact,” Chowdhry told VentureBeat via email. “By leveraging computer vision, machine learning, and natural language processing, our technology enables companies to quickly capture and decipher large amounts of data and automatically surface the most meaningful insights that will allow customers to confidently make strategic decisions and generate successful business outcomes.”
The top 60% of its customers — which occupy industries including retail, consumer packaged goods, manufacturing, mining, and insurance — bring in $10 billion more in annual revenue thanks to FortressIQ, claims Chowdhry. And FortressIQ helps its financial services clients manage over $5 trillion in assets.
No matter how differentiating FortressIQ’s technology might be, the company has its work cut out for it. RPA startup UiPath’s latest funding round totaled $568 million at a valuation of $7 billion. In September 2018, Softomotive brought in $25 million. Automation Anywhere last secured a $290 million investment from SoftBank, valuing the company at $6.8 billion. And Blue Prism recently raised over $120 million.
Microsoft venture fund M12 and Tiger Global Management co-led FortressIQ’s latest round (a series B), with participation from earlier backers Boldstart Ventures, Comcast Ventures, Eniac Ventures, and Lightspeed Venture Partners. It brings the startup’s total raised to $42 million following a $12 million series A in December 2018.
M12’s participation is a bit curious in light of a Bloomberg report suggesting that Microsoft is in talks to acquire Softomotive, but the tech giant might be hedging its bets on a segment that, while profitable, has recently seen instability. In October, UiPath laid off 300 to 400 employees (roughly 11% of its workforce) in what it characterized as a move toward efficiency. More recently, Automation Anywhere let go of 10% of its workforce as it adapts to stronger demand for cloud services motivated by the pandemic.
FortressIQ says that while the current economic climate has slowed the growth of its 70-person workforce, it’s “looking forward to getting back to normal.”