Kintsugi, a start-up based in San Francisco, has secured $6 million in Series A funding, with a valuation of around $40 million. The company, founded in 2021 by CEO Pujun Bhatnagar, offers software that helps businesses automate their compliance with sales tax regulations, which have become increasingly complex in the US. Failure to comply with these regulations can result in significant penalties and costs, as well as reputational damage. Kintsugi’s technology aims to reduce the time and effort businesses spend on this non-revenue generating activity.
Following a Supreme Court ruling in 2018, even online sellers are now required to collect and remit sales tax to jurisdictions where it is due. This has added to the challenges faced by businesses in relation to sales tax compliance. The current system requires businesses to identify the location of each customer, register to pay sales tax in every jurisdiction where they have customers, and ensure that the taxes collected are remitted to the correct jurisdiction within the specified deadlines. Kintsugi’s software helps automate these processes and ensure businesses remain compliant with the complex rules and regulations.
Kintsugi’s software helps businesses at the point of sale by automatically collecting necessary information to calculate the appropriate sales tax for each transaction. It also enables businesses to connect with the jurisdictions where they need to pay tax and facilitates the registration and payment process. The software, driven by machine learning, updates every 15 minutes to ensure compliance with the latest rules and changes in sales tax regimes in the jurisdictions where businesses operate.
Co-founder Pujun Bhatnagar’s background as a machine learning engineer at Facebook, along with his partners’ experience in finance and technology, led to the creation of Kintsugi. The trio recognized the opportunity to provide support for small and medium-sized businesses struggling with sales tax compliance, especially since many accounting software providers do not offer adequate assistance in this area. Kintsugi’s software has already attracted around 300 customers and processed approximately 800 million transactions, demonstrating its potential in the market.
With the additional funding, Kintsugi plans to expand its operations beyond the US and launch in Canada, the UK, and Europe. The company’s investors believe in its growth potential, as businesses continue to seek solutions for efficiently managing sales tax compliance. Lisa Dolan, managing partner at Link Ventures, praised Kintsugi’s use of AI to automate compliance processes, allowing companies to focus on running their businesses rather than dealing with tax paperwork. The company’s focus on saving time and money for businesses while ensuring compliance aligns with the growing demand for efficient solutions in the area of sales tax management.
