Entrepreneurship in the U.S. is thriving, with an average of 430,000 new business applications submitted each month in 2024—a 50% increase from 2019. However, the rising number of startups faces a significant challenge: a dwindling supply of accountants. Nearly three-quarters of certified public accountants (CPAs) are expected to retire within the next decade, and fewer graduates are entering the field, which often lags behind technology and finance in pay.
David Phillips, a seasoned entrepreneur, is addressing this gap through Fondo, his bookkeeping startup launched in 2020. By leveraging software, artificial intelligence, and a team of accounting experts, Fondo offers a platform tailored for startups and small- to medium-sized businesses.
Phillips, who previously founded the coding school Hackbright and sold it to Capella University in 2016, has also invested in over 85 startups, including Rippling and Flexport. Fondo marks his latest venture to disrupt traditional industries with tech-forward solutions.
In its four years of operation, Fondo has attracted approximately 1,200 customers and achieved an annual recurring revenue of $6 million—all while maintaining profitability. Notable customers include ElevenLabs, Karat, PostHog, Campus, and Limitless AI. The company claims to have saved its clients over $75 million in Delaware Franchise Tax and recovered $16 million in tax credits from the IRS.
To build on its momentum, Fondo recently secured $7 million in an oversubscribed seed funding round led by Tokyo-based fintech company Money Forward. Other participants included Y Combinator, Motley Fool Ventures, Next Coast Ventures, and multiple venture funds. The round values Fondo at $66 million.
As new businesses continue to emerge, Fondo aims to mitigate the growing accountant shortage with an accessible and scalable bookkeeping solution powered by AI, bridging the gap for entrepreneurs navigating complex financial requirements.
Featured image courtesy of Fondo
Leave a Reply