Friday, December 27, should be the start of a relaxing holiday weekend. But it’s chaos for thousands of small business owners who use Bench, the Canadian accounting and tax startup that raised $113 million from investors like Bain Capital Ventures and Shopify. That morning, he was unable to log into his account as tax season began. Bench’s website is all offline except for news that Bench is dead after 13 years of operation. Hundreds of Bench staff found they were effectively fired immediately without notice or notice, several former employees told TechCrunch. TechCrunch’s email to employees that day bounced back. The move was so sudden that one customer who stored years of data on Bench’s website, and even featured it on the front page before going offline, learned of the shutdown only when TechCrunch called him for a reaction. “I had no idea about it,” said Justin Metros, co-founder of Radiator. “I’ve never seen someone close like that. It’s crazy.” Bench automation struggle describes itself as a tech-forward accounting and tax startup with an intuitive platform that can be used by small or medium-sized businesses. They claim more than 12,000 customers at the time of closing. One of the reasons for the company’s struggle is to embrace AI and automation tools others in recent years, according to some staff. It turns out that it is easier to automate accounting tasks, like classifying expenses, in theory than in practice. One former employee claimed that it was the only way Bench can scale is AI, but the execution is flawed and the tool is not working correctly. Overreliance on this tool, sometimes at the expense of human bookkeepers, causes delays, with books passed around different teams. The delay causes some customers quit. One former employee told TechCrunch some customers are still waiting for 2023 books in September 2024, which is past the main tax deadline. According to former staff, Bench experienced several rounds of layoffs starting in late 2022. By the end of 2024, fewer than 400 people worked for Bench on LinkedIn, compared to nearly 700 in January 2023. coupled with turmoil in Bench’s executive suite. Bench’s first CEO, co-founder Ian Crosby, is leaving in 2021 a few months after Bench raised a $60 million Series C round. Crosby accused an unnamed board member of forcing him to be replaced by a “professional CEO” after disagreements over strategic decisions. “I hope the Bench story continues to serve as a warning to VCs who think they can ‘upgrade’ a company by replacing the founder. It doesn’t work,” Crosby wrote in a LinkedIn post after his sudden death. Bench’s second CEO is Jean-Philippe Durrios, who previously served as CFO. He focused on making the company profitable, according to former staff. Automation could, in theory, make Bench less reliant on expensive human labor to serve a large number of customers. But that gambit has fallen short amid execution problems, customer churn, and declining investor interest in companies unrelated to AI. Bench switched CEOs again in November 2024, bringing in Adam Schlesinger, executive-in-residence at VC firm Inovia Capital, one of Bench’s investors. At that point, the decision was made to sell the company, according to Schlesinger, a former Microsoft executive who also recently became president of the tequila company, Siempre Tequila. “I was pitched by Inovia Capital and then took the company through the process of getting it acquired,” Schlesinger told TechCrunch. “They need someone who can guide the ship through a difficult process.” And the revival is believed This process does not come out. On Dec. 27, Bench suddenly shut down without giving notice or severance pay to employees, many former staff told TechCrunch. This move was forced by the bank to call on the Bench business loan, The Information reported. Bench continued to make sales until the day he died, according to former employees. The closure sparked media attention in the US and Canada. Ironically, it’s the attention that saves Bench, Schlesinger told TechCrunch. “It was only after we closed all the PR, including from you, basically making the world aware that we sold, and we had some great interest after that,” Schlesinger said. “I haven’t slept in 72 hours,” Schlesinger said. The acquirers were unconventional. Jesse Tinsley, CEO of Employer.com, an HR technology company based in San Francisco, was on vacation in Florida when he saw the news about Bench the day after it closed publicly. Tinsley, who runs a host of HR and recruiting businesses, just bought the domain name Employer.com for about $450,000 a month ago, she posted on LinkedIn. Tinsley and his team spent the next 36 hours working on a deal. On Monday morning, Employer.com officially announced plans to acquire Bench for an undisclosed price. “I never officially met anyone on the Bench team until Saturday afternoon,” Tinsley later tweeted, sharing the infamous photo of Elon Musk bringing a sink to Twitter, only with his face and bench Photoshopped into the image. “However, we saved hundreds of jobs and thousands of customers who were left in the lurch.” It’s not always true that Employer.com made big promises about reviving the Bench. To begin with, it again extended job offers to “a large number” of former Bench staff, Bench Chief People Officer Jennifer Bouyoukos told TechCrunch. It also said it would honor customer contracts and fully service accounts, Tinsley said. The Bench’s initial death notice recommended the client file for a six-month extension with the IRS to find a new bookkeeper. Currently, the Bench does not recommend an extension as long as the customer decides to stay. But there is still uncertainty about the Bench’s sustainability, given the last-minute fire sale. Acquisitions usually take months and require a great deal of diligence, which cannot be done during a holiday weekend. Employer.com also had no direct experience in accounting until the acquisition of Bench – instead, it focused on payroll, recruiting, and HR-related fields. If the collapse of the Bench shows anything, it’s that accounting is its own animal. There are also concerns about whether customers will have access to the same quality of service, because all Bench staff were fired suddenly on December 27. Although many staff are being rehired, at least some of them are offered only 30-day contracts. three former employees told TechCrunch. In response, the chief marketing officer of Employer.com, Matt Charney, told TechCrunch that “when the deal happened quickly,” it involved “multiple legal companies” and Employer.com felt “very comfortable” with Bench’s reputation and track record. At Employer.com lacking previous accounting experience, Charney said that Bench was acquired for people, experience, and customers, which could “help us get that expertise very quickly.” Employer.com declined to comment specifically on the 30-day contract at press time.
