Our Latest Investment: Bringing AI to Professional Service Firms
Today, we are pleased to announce our seed investment in Anduin, a software company improving invoicing, accelerating collections, and modernizing payments for owners and executives in professional services, such as accounting. The Charlotte, NC-based startup is using AI to automate routine tasks, such as scheduling email and SMS reminders for outstanding invoices, and to offer predictive insights to improve the end-to-end payments process.
Imagine running a business where your costs are fixed and you don’t know what you will charge nor when you will get paid. That’s how many professional services firms operate today:
· Partners find the billing process to be painful and put it off, resulting in unnecessarily delayed payments;
· Therefore, firms must keep more cash on hand to offset imprecise billing and slow collections;
· This results in CEOs not knowing how much partners are charging or when their firm will be paid.
This is crazy, unnecessary, and expensive as firms’ most valuable resources (the accountants, lawyers, and other billing partners who generate revenue) waste time preparing bills or hunting down deadbeat clients, while their CFOs are forced to set aside valuable cash to float the businesses operations. The situation was only amplified during the economic downturn of 2020. Many small and medium-sized businesses were concerned they would not be paid by clients who faced bankruptcy or significant volatility. Operating on diminishing cash, businesses owners were concerned for their survival. Not only were they in need of more visibility into their cash flow, but as offices shut down around the country, they were forced to abandon paper-and-pen efforts and adopt digital workflows.
Anduin stepped in to offer a modern payments architecture that was purpose-built to address the pain points experienced in outdated, legacy systems. Justin Adams, founder, and CEO, and his all-star cast of co-founders have developed an “Intelligence-Based Billing” software platform that optimizes every part of professional services firms’ “work-to-cash” workflow. Anduin’s customers deliver a better payments experience to their clients, get more cash in the door faster, eliminate hours of manual invoicing work, and gain AI-generated actionable insights.
Results have been impressive with fast-growing revenue from happy customers who have seen a 3x jump in the number of invoices being paid within seven days, a huge increase in online payments, and a dramatic decrease in the time spent performing the monthly chore of billing. At the end of the day, partners waste less time collecting. Customers can track their bills and pay more easily. And CEOs have more cash on hand and greater visibility into their businesses. Win. Win. Win.
At Revolution Ventures, Anduin continues an investing theme we have pursued for over a decade, focusing on startups that improve business management and accelerate working capital. We were the first investors in LivingSocial (acquired by Groupon), a company that used online marketing to sell vouchers and coupons, which dramatically accelerated revenue collection for small businesses like restaurants and spas. We were the founding investors in Booker (acquired by MindBody), which created a system-of-record and a payments and collection platform for salons and yoga studios, making it much easier to drive and collect incremental revenue for businesses ranging from small mom-and-pops to very large enterprises. As Anduin’s first institutional investor, we are confident that Justin and his team have the right idea and the right platform to do the same thing for professional services firms.
