On Wednesday night news broke that NYSE-listed AI giant UiPath had acquired Manchester-based Peak for an undisclosed sum.
The announcement made headlines on both sides of the Atlantic – but for different reasons.
In the UK the reaction was almost unanimously supportive, with a liberal sprinkling of words like ‘epic’, ‘landmark’ and ‘awesome’ on social media.
I myself started a late-night LinkedIn post about the deal with the words ‘WOW!! WOW!! WOW!!’
Not all the investors were happy – some of whom have contacted me – but it was hardly Peak’s fault that its valuation had dropped from its 2021 peak (no pun intended) following its eye-watering $75m Series C investment led by SoftBank’s Vision Fund.
However, in the US, much of the focus has been on UiPath’s plummeting share price after an underwhelming Q4 financial performance.
Headlines included ‘UiPath’s revenue growth slows to a crawl’ and ‘UiPath stock sinks to an all-time low’.
In truth, the deal probably suits both sides. Peak’s 2023 revenue was a modest £9m while UiPath looks to use Peak’s tech to roll out a suite of AI agents.
Before we go inside the deal a quick recap about who Peak are.
Friends Richard Potter, David Leitch and Atul Sharma launched Peak in 2015 after famously sketching out their vision for the business on a napkin during a visit to the pub.
The idea was simple – to help businesses unlock the full power of AI to understand their data to drive real change.
At the time AI wasn’t as mainstream as it is now and Peak’s timing appeared to be perfect.
Its software platform enabled companies to put AI at the heart of their decision-making and operations.
The startup established a global presence with six offices worldwide as it grew its team to more than 200 people, won a handful of awards and secured the likes of Nike and PepsiCo as customers.
Investors were happy to throw money at yet another exciting AI tech startup. In 2020 MMC Ventures and Praetura Ventures led a £9.7m Series A investment round but that was just for starters.
In February 2021, a £15.2m Series B funding round was announced, led by venture capital firm Oxx, with participation from existing investors MMC Ventures and Praetura Ventures, and new investor Arete.
At the time the talk was of opening bases in the US and India and creating 130 new jobs globally.
A few months later – in August 2021 – Peak secured a $75m Series C investment led by new investor SoftBank Vision Fund 2. It was a game-changer and brought Peak’s total funding to $119m.
2021 was the height of the tech boom and Peak had no control over its frothy valuation.
However, the tech world of today is a million miles away from the halcyon days of 2021, when investors put growth before profitability.
That all changed following the collapse of Silicon Valley Bank in 2023 and rising inflation.
Raising investment became a lot harder with one-time unicorns wejo and Cazoo among the big names going to the wall.
Against this backdrop it’s safe to assume that tech companies like Peak would have found it a lot harder to raise investment.
Its revenues – £8.996m in 2023 compared to £7.659m in 2022 – were up 17 per cent but still less than they would have hoped while headcount dropped from 343 to 249 over the same period.
Those who know Potter, who was included in BusinessCloud’s 2024 Northern Leaders list, say he subscribes to the theory that if you’re not building a company for exit you’re effectively a zombie company.
All of which goes a long way to explaining why the deal with a tech giant like UiPath – and the timing – make so much sense.
UiPath is a robotic process automation (RPA) company that has developed AI technology that mirrors human intelligence, transforming the way businesses operate.
Daniel Dines, founder of UiPath
UiPath was founded in Bucharest, Romania, by Daniel Dines, who is a legendary figure in the world of AI. Forbes magazine described him as ‘the first bot billionaire’. Why wouldn’t Peak’s co-founders Potter, Leitch and Sharma want to work with him?
In 2021 the company underwent an IPO, pricing its shares at $56 and raising £1.3bn. At the time of writing this its share price stands at just under $10 – compared to $15 just a month earlier.
Earlier this week UiPath put out some underwhelming Q4 financial figures and projections but the company still has a market cap of around $5.5bn.
The announcement that they’d bought Peak was seen by many as a silver living.
UiPath’s President Ben Fiechtner said he was genuinely excited to have Peak as part of its team.
The bigger question is this: How much are geopolitics and Donald Trump’s presidency to blame for UiPath’s declining share price?
US share prices have dropped on the back of the vast budget cuts pursued by the Department of Government Efficiency (DOGE) and fears of a recession are growing on the back of Trump’s obsession with tariffs.
The irony is not lost of anyone that Tesla’s share price has tanked while its CEO Elon Musk has become the public and unpolular face of DOGE.
All which brings on to UiPath’s decision to buy Peak.
Potter described it as the ‘perfect next step’ for Peak at this time in their journey while Dines said it would accelerate the tech giant’s mission to strengthen its vertical AI solutions strategy
“When combined with the UiPath platform, Peak’s exceptional purpose-built AI applications will enhance our ability to provide solutions that optimise industry-specific use cases and deliver incredible value to customers,” said Dines.
The terms of the deal have not been disclosed although TechCruch reported that Peak had not been actively looking for a buyer, nor was it at the end of its runway.
GP Bullhound, a leading technology advisory and investment firm, advised Peak on the transaction.
The deal makes a lot of sense for Peak and UiPath on multiple levels.
- Peak has had a long-standing partnership with UiPath spanning several years;
- UiPath’s leadership in automation – combined with Peak’s AI-driven decision intelligence capabilities – creates a natural synergy;
- UiPath gives Peak access to its 10,500 customers.
The deal will enable Peak to grow from its Manchester HQ, as well as its other key locations, such as Jaipur in India.
Some of the smaller investors have definitely lost out but the deal is good news for Peak and UiPath.