SAN FRANCISCO, Feb. 13, 2023 -- Fondo, a San Francisco-based startup serving as an all-in-one accounting platform, today announced a $3 million pre-seed round. The fundraise includes $1.2 million in equity with participation from Y Combinator, Liquid2 Ventures, Transmedia Capital, GMO Venture Partners and $1.8 million in non-dilutive financing from Capchase. Fondo will use the new funding to invest in product development and grow the team.
Fondo was founded in 2020 to help startups get their taxes filed, close their books, and get cash back from the IRS. Fondo’s intuitive dashboard helps early-stage founders navigate tax compliance with clarity and speed. As a result, Fondo has helped startups get an average of $21,000 back per year.
"We started Fondo to improve the financial health of all startups, because running out of money is one of the top three reasons startups fail,” said David J. Phillips, CEO and founder of Fondo. “Our vision is to help startups get a total of $1 billion back from the IRS by 2025 to enable them to extend their runway and invest in growth during a time when it’s very difficult to bridge any round."
Startups are eligible for up to $500,000 per year in cash-back tax credits, but many early-stage founders are leaving money on the table. Fondo helps companies without an in-house finance team by compiling accurate financial statements, ensuring taxes are filed on time, and claiming tax credits. In today's bearish venture funding environment, finding ways to extend runway until the market improves is crucial. Tax credits and non-dilutive financing offer two complementary paths to fund growth and are not dependent on VCs deploying capital again.
“Fondo's metrics are first-rate, which is a testament of their product market fit,” said Miguel Fernandez, CEO and co-founder at Capchase. “When they connected to the Capchase platform we could see that the projected performance would place Fondo among the best cohort of companies. We are excited to help power Fondo's growth.”
In 2022 Fondo experienced top decile growth, including doubling its team to 54 people and nearly tripling revenue to $3 million in annual recurring revenue. Today, more than 500 startups use Fondo, including Career Karma, Tydo, PostHog, Explo, and Bottomless. Fondo was ranked number one in the fintech category on Product Hunt for the month of August 2022, and secured over $3.5 million in cash back from the IRS in quarter four of 2022 for its customers, helping them extend their runway.
Fondo, a San Francisco-based startup serving as an all-in-one accounting platform, founded in 2020, specializes in helping early-stage companies get their taxes filed, books closed, and cash back from the IRS (the average startup gets back $21,000 per year). Fondo's intuitive dashboard helps founders navigate tax compliance and credits with clarity and speed.