1 © 2019, HFS Research Ltd.

The HFS Hot Vendors Q4 2018

Elena Christopher, Research VP; Madhurparna Banerjee, Knowledge Analyst; Melissa O’Brien, Research VP; Reetika Fleming, Research VP

Defining Future Business Operations

© 2019, HFS Research Ltd. | www.HFSresearch.com | @HFSResearch

2 © 2019, HFS Research Ltd.

The HFS Hot Vendors are an exclusive group of emerging players with a differentiated value proposition for

the Digital OneOfficeTM (Exhibit 1). HFS analysts speak with numerous exciting start-ups and emerging

players. We designate a select group as the HFS Hot Vendors based on their offerings' distinctiveness,

ecosystem robustness, client impact, financial position, and the impact in our OneOffice Framework. The

HFS Hot Vendors may not have the scale and size to be featured in our Blueprint reports, but they have the

vision and strategy to impact and disrupt the market.

Exhibit 1: The HFS Digital OneOffice Framework

In the rapidly changing space of digital operations, enterprises realize they cannot be everything to everyone.

Whether you are an enterprise consuming third-party services, a service provider, or a technology provider,

you will need a smart ecosystem to succeed and survive the future. HFS Hot Vendors are service and

technology providers hand-picked by our analysts to help you flesh out your smart ecosystem with offerings

that solve today's complex business problems and exploit market opportunities. In this increasingly "me too"

world, HFS Hot Vendors display truly differentiated offerings and out-of-the-box thinking that can be both

inspiring and useful.

3 © 2019, HFS Research Ltd.

In this report, we profile five short-listed players (Exhibit 2) who have been designated as HFS Hot Vendors

based on our rigorous five-step assessment over the course of Q4 2018. The HFS Hot Vendor designation for

the following players will remain in place till the end of Q4 2019 (a period of one year), when the same process

will be followed for renewing the HFS Hot Vendors designation.

Exhibit 2: HFS Hot Vendors Q4 2018 Edition (in alphabetical order) Note: The HFS Hot Vendor Designation is valid for a period of one year from Q4 2018 to Q4 2019

Celonis Spearheading the process-mining revolution

CUJO AI Enabling broadband network operators to offer AI-based cybersecurity services for their customers’ connected devices and things

Directly Rethinking and disrupting the traditional customer service model

Magisto AI-powered video editor for marketers

Shanghai i-Search Software Leveraging its background in user and entity behavior analytics to offer localized robotic process automation (RPA) software and services across China

SiriusIQ Seriously applying emerging technologies to streamline business data for IA

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Shanghai i-Search Software: Leveraging a background in user and entity behavior analytics to offer localized robotic process automation (RPA) software and services across China Author: Elena Christopher (bio)

Shanghai i-Search Software (i-Search) is a China-based software and services company that offers RPA’s

automation potential to China at a local level. Founded in 2011, the company got its start as a developer of

user and entity behavior analytics (UEBA) software and established a strong client base throughout China

with clients in every province. UEBA software is generally used for fraud detection and to support security

and compliance needs, but due to its cross-business data collection, it also serves as a powerful efficiency

analysis engine. i-Search’s ability to analyze and visualize business processes and function efficiency with its

patented screen-recording technology led it to develop automation tools. In 2017, it launched its User

Behavior Assistant Intelligence (UBAI), which combines machine learning and RPA. Through UEBA’s

processes and efficiency tracking, UBAI learns which processes have consistent steps and offers users the

option to automate these repetitive steps. Its UBAI intelligent automation product has scaled quickly, with

its largest implementation running 10,000 automations.

In early 2018, it launched iS-RPA, an RPA software offering attended and unattended automation. The

company appears to be the first Chinese RPA software provider, competing against global players such as

UiPath, Blue Prism, and Automation Anywhere plus a quickly emerging set of Chinese players that includes

Alibaba. As HFS learned through client reference checks, i-Search differentiates itself through its technology

and the availability of its localized service and support. Clients indicate that when piloted against other RPA

software, i-Search’s video recording and log functionality helped provide critical visibility into

troubleshooting unattended bot performance. It currently has implemented iS-RPA with more than 25

clients, with at least one scaling upwards of 100 bots.

The firm is headquartered in Shanghai; its research and development center is in Nanjing, and various

offices are spread throughout the country. While the company has a sales and services team throughout

China, it is also cultivating regional partnerships to support sales, implementation, maintenance and

support, and training services. These partners are greatly expanding i-Search’s sales and implementation

footprint and forming a powerful network to provide local support to clients.

Continued investment has been a critical component of growth. In 2014, Tongding Group, a Chinese

conglomerate with a strong research and development focus, proffered an initial round of investment that

5 © 2019, HFS Research Ltd.

was seminal in getting its UEBA product off the ground. It also helped propel i-Search’s 2016 addition to

China’s over the counter (OTC) market, National Equities Exchange and Quotations (NEEQ), which is also

known as the "new third board.” i-Search received two more funding rounds from other investors, both in

2017. These funds have been used to expand product development and launch its automation products as

a complement to its UEBA. Its current valuation is purported to be about 550 million Chinese yuan (~$80

million). The company has plans to launch its initial public offering (IPO) in 2020.

HFS’ take

HFS designated i-Search as a Hot Vendor due to its role in offering the value and benefit of RPA software

and services to the underserved, high-potential regional market of China. While the bulk of RPA uptake has

been in North America and Europe, Chinese enterprises, like their western brethren, are wildly interested in

reaping the cost and productivity benefits available through RPA. Reference customers interviewed for this

profile indicated that the familiar objectives of achieving lower cost and higher efficiency of business

operations and improving the quality of work through eliminating repetitive and mundane tasks are their

primary drivers for embracing RPA.

However, competing effectively against established and leading RPA software providers is hard to do. The

only real avenues for this are through offering differentiated technology, such as layering in intelligence

through elements of AI, or through a targeted regional strategy that capitalizes on localization. i-Search is

trying to do both, but its localization strategy is ultimately what will make the company successful.

While iS-RPA is a relatively new tool, i-Search is doing an effective job of riding the hype curve of RPA—

selling into its existing client base in financial services and telecommunications and expanding its partner

network to gain new clients. i-Search is winning in head-to-head competition against the established RPA

software players. Its reference clients cite satisfaction with their tool functionality, particularly around its

screen recording and querying capability to help diagnose issues with unattended bots, their R&D

capabilities and tie-ups with local academia, and the local availability of service, support, and training

resources as key reasons for selecting iS-RPA. This localization is critical as it enables i-Search to support its

clients onsite and in near real-time. The availability of training is also crucial to help clients cultivate RPA

expertise in-house. A recent HFS study on RPA talent found that the lack of local RPA resources contributes

to the inability to scale automation programs.

While i-Search aspires to expand beyond China and has initiated operations in Hong Kong, HFS recommends

that it give a higher priority to first establishing a strong foothold in China. It needs to increase the adoption

6 © 2019, HFS Research Ltd.

of its iS-RPA tool, which was only launched in early 2018. This includes not only increasing the number of

implementations but also ensuring its clients are achieving the desired business benefits post-

implementation. It also needs to ensure it can fulfil its localization claim; being physically present in China is

only part of the success equation. i-Search needs to ensure that not only is it developing strong RPA talent

but that it’s also training and developing the resources of its partner network so that its client base has

access to experienced resources. i-Search should also take a leadership role in China and educate the local

market on best practices for making RPA and automation successful.

i-Search can support its desire for expansion beyond China by proving itself with multinational corporations

that may offer international opportunities. It should also ensure that its expanding partner network

includes the Chinese partner firms of global consultancies.

Vendor factsheet

● Founded in 2011

● i-Search has created a footprint through China with its headquarters in Shanghai, its R&D center in

Nanjing, and branches in Beijing, Guangzhou, Shenzhen, Chengdu, Wuhan, Jinan, Nanjing, and

other cities

● The company was founded by Tang Qisong (Daniel Tang), who is the current chairman and general

manager of the company

● Number of employees: ~150

● Financial backing by investors: Tongding Group initially invested in the company in 2014. Two

additional rounds with other investors followed in 2017. In 2016 i-Search was listed on China’s over

the counter (OTC) market, National Equities Exchange and Quotations (NEEQ), which is also known

as the "new third board.” The company plans to pursue its IPO in 2020.

● Clients: 300+ across all product lines, including approximately 25 for its RPA product. Notable RPA

clients include Pudong Development Bank, China Guangfa Bank, Industrial and Commercial Bank

(Hong Kong), Haitong Securities, China Pacific Insurance, China UnionPay, Sinopec, China Mobile,

and China Telecom.

Industry coverage

i-Search’s RPA toolset is applicable across sectors, but its greatest depth of experience is with the financial

services industry (banking, securities) and telecommunication operators.

7 © 2019, HFS Research Ltd.

Solution portfolio

i-Search offers four product lines and associated services:

• Counter Service Monitor

• User and Entity Behavior Analytics (UEBA)

• User Behavior Assistant Intelligence (UBAI)

• Robotic Process Automation: Its UEBA technology, including screen recording, is integrated into the

iS-RPA toolset. The product suite consists of the following three components:

o Designer: The Python-based designer for designing processes includes various pre-defined

elements for business users and an expert mode for technical resources.

o Control Center: Overarching control center including managing and pushing processes out

to bots, real-time monitoring, log management and playback, and dashboards.

o Robot: Terminal used to deploy and execute assigned tasks.

Partnerships

• Sales and delivery partners: i-Search has developed more than 100 sales and delivery partners

throughout China. The partners are responsible for developing the local market, project

implementation, maintenance, and training.

• Consulting partners: The company has also established industry partnerships with PwC, Deloitte,

EY, Grant Thornton, and other domestic and foreign consulting companies, mainly responsible for

the promotion and implementation of RPA products in the financial services and tax fields.

• Academia: i-Search works with the School of Artificial Intelligence of Nanjing University, where it is

jointly developing the next generation products of RPA+AI.

8 © 2019, HFS Research Ltd.

HFS Hot Vendors Assessment Methodology HFS Hot Vendors undergo a straightforward but rigorous five-step assessment:

1. Pre-selection. We do not consider a player a potential Hot Vendor if it qualifies for any of our

Blueprint Reports. Our Blueprint Reports feature the major and established players across every

dimension of the Digital OneOffice.

2. Analyst briefing. The process starts with a briefing during which we ask vendors to share their story

with our analysts. We typically ask questions around value proposition, potential distinctiveness,

solution details, financial position, and client impact.

3. Client reference. If the HFS analyst sees potential after the briefing, we ask the vendor for a couple

of client references so that we can speak directly with clients. The client conversations help us

understand what is real and what is just marketing spiel. Note that we do not divulge any client details

and these calls are kept strictly confidential.

4. HFS selection. HFS analysts recommend their potential Hot Vendor to the selection committee

(comprising CEO Phil Fersht, Chief Strategy Office Saurabh Gupta, and Chief Data Officer Jamie

Snowdon), which determines if the vendor brings forth a differentiated value proposition for the

Digital OneOffice. We publish the selected vendors on our website.

5. We expect some of the HFS Hot Vendors to progress over time to get featured in Top 10 Reports, be

acquired, or change strategic direction. Consequently, we award the HFS Hot Vendor designation for

one year and follow the same process for renewing a vendor’s place on the HFS Hot Vendor list.

If you think you deserve to be an HFS Hot Vendor, please click here to schedule a briefing.

9 © 2019, HFS Research Ltd.

HFS Research authors

Elena Christopher | Research VP, HFS Research Elena Christopher is Research Vice President, Industry Research and Robotic Process Automation (RPA) at HFS. Elena is responsible for driving the industry-specific research agenda for HFS, digging into the major trends impacting each in-scope industry and the implications for business process and IT services.

Melissa O’Brien | Research VP, HFS Research Melissa O'Brien is Research Vice President, Customer Engagement, Retail and Travel Strategies at HFS Research. Melissa leads HFS’ research initiatives for digital front office services, including customer engagement operations, digital marketing, cognitive agents and CX design and consulting.

Reetika Fleming | Research VP, HFS Research

Reetika Fleming is Research Director, Insurance & Smart Analytics at HFS Research. Her research extends into defining future business operations for property and casualty, life and annuities and reinsurance companies. She studies the broad use of data and analytics within enterprises, with a new research focus on machine learning and AI techniques to improve business decision making.

Madhurparna Banerjee | Knowledge Analyst, HFS Research

Madhuparna Banerjee is a Knowledge Analyst at HFS Research, supporting the business process services. Her responsibilities include collecting and analysing data and information and to create POVs and custom reports. Additionally, she provides insights and analysis for solving client problems.

10 © 2019, HFS Research Ltd.

About HFS Research: Defining future business operations

The HFS mission is to provide visionary insight into major

innovations impacting business operations, including:

automation, artificial intelligence, blockchain, Internet of

things, digital business models, and smart analytics.

HFS defines and visualizes the future of business operations

across key industries with our Digital OneOffice™ Framework.

HFS influences the strategies of enterprise customers to help

them develop OneOffice backbones to be competitive and to

partner with capable services providers, technology suppliers,

and third-party advisors.

Read more about HFS and our initiatives on

www.HFSresearch.com or follow @HFSResearch.