Bench, a popular accounting platform startup, acquired by Employer.com 3 days after abrupt shutdown

Popular accounting startup Bench abruptly shut down on Friday, marking a dramatic end for a company that had once been a favorite among small businesses and startups across North America. The closure comes just a few years after venture capitalists on the board ousted the original founder, Ian Crosby, claiming they could steer the company in the “right direction.” That direction, it seems, led straight to its downfall.

Crosby, who co-founded Bench in 2012, says the shutdown was predictable after the VCs fired him and took the company in what he describes as a poorly conceived new direction. Before its closure, Bench had raised over $100 million in total funding as of December 2024.

“The Vancouver, British Columbia–based startup said it was shutting down services for customers, effective immediately. MacBride found she couldn’t access her company’s financial information, including loan statements and tax returns, through Bench’s website,” The Information reported.

The sudden announcement left Bench’s 12,000 customers scrambling to find alternatives for their accounting and tax needs. Other accounting startups like Pilot and Kick seized the moment, offering discounts to lure displaced customers, according to their founders. Meanwhile, Bench informed its staff that the company was insolvent, deepening the sense of crisis.

Elizabeth MacBride, an author and small business owner, shared her frustration with the abrupt shutdown. She had been enjoying a belated Christmas celebration when an email from Bench landed in her inbox, notifying her that services would be discontinued immediately. MacBride found herself locked out of critical financial documents, including loan statements and tax returns, as the company’s website became inaccessible.

Bench’s journey began in 2012 under the name “10sheet Inc.” and quickly gained traction after being accepted into the TechStars NYC accelerator program. The startup rebranded to Bench and expanded its services to help over 35,000 U.S. businesses with bookkeeping and tax preparation. Backed by high-profile investors such as Shopify and Bain Capital Ventures, the company raised a total of $113 million over several funding rounds.

Starting with a $2 million seed round in 2013, Bench raised $7 million in Series A funding in 2015, led by Altos Ventures and Contour Venture Partners. Subsequent rounds included $16 million in Series B funding in 2016, $18 million in Series B-1 funding in 2018, and $60 million in Series C funding in 2021, with the latter enabling the company to introduce integrated banking services. By the end of 2024, Bench employed approximately 650 people in Vancouver.

The downfall came swiftly. On December 27, 2024, Bench sent customers a blunt message:

“We regret to inform you that as of December 27, 2024, the Bench platform will no longer be accessible.”

In plain terms: “We’re done. You’re on your own with your taxes.”

The company suggested users file a six-month IRS extension and transfer their data to a competitor, Kick. But for many, that advice came far too late, leaving them scrambling to salvage their financial records.

Bench’s collapse is a stark reminder of the risks that come with VC involvement. Once a lifeline for thousands of small businesses, the startup’s sudden closure has left customers angry and disillusioned. It’s another cautionary tale about the challenges of scaling too fast without maintaining focus on sustainable growth.

Employer.com Acquired Beach Accounting

December 30 Update:

Yesterday, the Vancouver, Canada-based Bench announced on its website that it has been acquired by California-based HR tech company Employer.com. The acquisition includes  Beach’s workforce of over 600 employees. Employer.com stated that it has been collaborating with Bench customers behind the scenes to ensure a smooth transition. According to the company, customers will retain their in-house bookkeepers, and all data remains intact, secure, and protected, CBC reported.

“Employer.com, a leader in workforce management and business support solutions, is thrilled to announce the acquisition of Bench Accounting, a premier provider of bookkeeping services and financial solutions for small businesses,” Beach said in a news release.