We now have the capital and expertise to achieve our long-term ambition of building a regional electric air mobility network. At a European tech macro level, all the key indicators such as investment, the growth in the number of founders and new tech companies being spun out of existing tech companies and the growing numbers of engineering students at our top universities is testament to the growing strength of European tech. Last year’s report made reference to the European tech flywheel. I suspect we have had another great year and we will see that flywheel spin even faster.
Romania is one of our most important talent pools and remains a key market for our developer teams, along with India and the United States. It’s become a tech hub in its own right and produces some of the world’s best tech talent. Culture is very important to me and to our leadership team at UiPath. That’s as true in our Romania offices as anywhere. Traditionally, we’ve thought of culture in terms of interaction among colleagues in the workplace, but now with office closures due to the pandemic we’ve had to broaden how we think about it. One of our goals now is to ensure the UiPath culture isn’t lost or diluted as the workforce transitions to work from home.
💪But European IPOs are scaling up
We saw numerous tech IPOs including Auto1, About You, Mister Spex and more this year in Germany. The increasing importance of tech companies is also reflected in the new composition of Germany’s flagship DAX index. With Delivery Hero, Zalando and Hello Fresh, three Berlin-based and former VC-backed companies are now part of the 40 DAX constituents.
In addition to traditional IPOs, SPAC listings became a notable alternative path to go public in 2021 – not only in the US, but also in Europe. The business combination of Lakestar SPAC I and HomeToGo marked the first prominent example of this alternative route to capital markets in Germany.
The pipeline for further IPOs remains strong and – subject to prevailing market conditions – we’re expecting continued growth in European IPO activity also in 2022.
The main considerations in Europe for founders considering a public listing today remain: liquidity such that they can reliably access a deep long term investor base, a valuation that is not a discount to an alternative exchange, depth and quality of research coverage, a regulatory framework that provides maximum flexibility (alternative listing structures, founder control, minimum float and capitalisation requirements) vs. the US. Clearly there is some way to go yet but key European exchanges and policy makers, not least the LSE and the FCA earlier this year, have demonstrated the willingness to compete globally while continuing to provide an adequate level of investor protection. This is not a race to the regulatory bottom but instead recognises that technology is a unique long duration asset, which needs a discerning capital base and regulatory environment to support innovators over the long run.