The low-code industry is competitive, and Appian (APPN 5.25%), the pure-play leader in the industry, faces a wide range of rivals. Those include Pegasystems, its most direct competitor, and large-enterprise software companies like Salesforce and Microsoft, as well as fast-growing cloud companies like UiPath.
In this episode of Beat and Raise, recorded on Oct. 8, Motley Fool.com contributors Jeremy Bowman and Nicholas Rossolillo discuss the competitive landscape in low-code and what Appian had to say about its Investor Day conference.
Nick Rossolillo: Key takeaway here, I showed the slide earlier, the total addressable market, CEO Matt Calkins said, he doesn't completely agree with all of these numbers. I'm not sure if he thinks they're bigger or smaller, I'm going to guess he thinks some of them are bigger because I know UiPath, they play specifically in the RPA space, they're already pushing this revenue number already as of those. The point is, it's a big industry.
Jeremy Bowman: We should mention also that Appian has just about $300 million in trailing revenue. So you're looking at an addressable market that's according to that estimate, about 200 times the company's current revenue. There's tons of room for growth here and the market is getting bigger.
Nick Rossolillo: It's huge. Obviously whenever we're talking an open-ended development platform like Appian, we're going to talk about a pretty huge market just because of built-in flexibility of what that platform can do. The competition, just to help everybody wrap their minds around how big this thing is, there's a company called Pegasystems listed there on the left. That's actually a really old business that's been around since the '80s. Calkins said that this is more than anyone else in this space, the low-code no-code, RPA process mining space, Pegasystems by far who they see the most, who they go up against the most often. It's a bit bigger. They are a bit bigger than Appian is. We'll talk more specifics on some of these companies in a bit. Obviously, some of the big cloud providers out there double in this space as well. Microsoft, ServiceNow, Salesforce, obviously none of these are a pure-play. The vast majority of their revenue is derived from somewhere else, not specifically low-code no-code. But they have products that address that market as well. But then the RPA space is really interesting over here on the far right because this is where some of the industries were starting to emerge. UiPath was a real hot IPO earlier this year back in the spring. They just do this thing called RPA, Robotic Process Automation and it's those bots that, Jeremy, you were talking about, those software-based bots. A similar thing, you don't have to necessarily have a lot of knowledge of coding to get these bots to work. It's a toolkit and you can grab the tool out of the toolkit that you want, drop it into an application that you're working on, and set the spot loose on it. It's like a virtual worker. Appian made their first ever acquisition, actually, January of 2020, to get themselves into the space and add these software-based bots to their low-code platform. Automation Anywhere is another competitor. They're going to IPO at some point, they are talking about that. Outsystems, another competitor in that space. Mendix is another low-code no-code platform that's owned by German industrial conglomerate Siemens, which I think illustrates how big this industry is, how big the total market is out there, and the type of customers that Appian is going after. When you have some big names like that out there working with industrial businesses, oil and energy companies, utilities. We're talking about a pretty big industries with a lot of complexity to them and the software is flexible enough for that it can help with their digital transformation.
