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Microsoft Acquiring RPA Startup Softomotive?

Microsoft is negotiating to acquire RPA (robotic process automation) software provider Softomotive, Bloomberg reports. The potential deal, if consummated, would position Microsoft against fast-growth RPA software providers such as Automation Anywhere and UiPath.

Updated May 19, 2020: Microsoft officially acquires Softomotive

RPA software allows businesses to write code and bots that rapidly automate tasks across multiple departments — from IT service desks to HR, finance, customer support and more. Much of the RPA software industry focuses on enterprise customers. Still, RPA may even eventually catch on in the SMB market as MSPs seek to further automate internal and customer operations.

Related Report, May 6, 2020: Microsoft seeks to acquire CyberX for IIoT security. MSSP implications  explained

Softomotive & Microsoft Power Automate

Amid that backdrop, Softomotive has quietly grown from its 2006 launch to support more than 8,000 customers. A reseller program, launched in 2011, has supported that growth.

Softomotive’s flagship products include:

The company in 2018 raised $25 million in Series A  capital from Grafton Capital.

Meanwhile, Microsoft has its own RPA software called Power Automate (previously Microsoft Flow). It’s explained here:

ChannelE2E does not know if Softomotive and Microsoft Power Automate are complementary in nature.

Neither Microsoft nor Softomotive have commented about the alleged M&A discussions.

RPA Market Growth, Challenges

The global robotic process automation market is expected to reach $10.7 billion by 2027, expanding at a CAGR (compound annual growth rate) of 33.6% from 2020 to 2027, according to Grand View Research Inc.

Still, the RPA market faces some growth challenges amid the coronavirus pandemic and related economic fallout. The evidence: Both UiPath and Automate Anywhere have had targeted layoffs in recent months.

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6 Comments

Comments

    Steve Priestnall:

    That is the big question? Who will consume who in terms of technology superiority the Microsoft Power Automate Suite or Softomotives products.

    It will be interesting to watch the RPA space, whenever Microsoft invests it is usually for the long term, based on a strategic play to create asolid foundation to build on. A purchase of this nature will help them to capture market share must faster. UiPath, Automation Anywhere and Blue Prism will be looking over their shoulders now.

    Let the games begin.

    Joe Panettieri:

    Steve: Thanks for the note, and for adding Blue Prism as an important company to note in this competitive landscape. Congrats on Onqu’s focus. So many MSPs don’t quite understand the RPA opportunity (and associated challenges). I’d like to learn more about Onqu’s business journey to date. Feel free to email me, your time permitting: Joe@AfterNines.com.

    Best,
    -jp

    Chaz Perera:

    This is great news for companies on or thinking about their automation journey! Hopefully, it simplifies building a bot that can truly work an end to end process. The challenge here, as with any automated process, is getting to positive ROI. Will this help remove any procurement steps and technology integration steps that will reduce the overall cost of an automation?

    Joe Panettieri:

    Hi Chaz: We’ll keep your questions in mind if/when Microsoft confirms this acquisition. -jp

    Scott Merritt:

    If you ask me, this is a play by Microsoft to buy the framework of an RPA company and not much else… the community, the training modules/infrastructure, things that would take time to build and foster for their PowerAutomate solution which does pretty much the same thing Softomotive does (using MS Accessibility). It will be interesting to see but should be a good value for MS regardless. That said, odd they would make a big deal about “PowerAutomate” and then go buy a company that does the same thing they said PowerAutomate does:).

    Joe Panettieri:

    Scott: Thanks for your perspectives, and for further explaining how Softomotive may align with Microsoft. We’re still poking around to see if there’s any truth to this M&A rumor. Stay tuned for potential updates, and thanks again for your views.
    -jp

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