Digital-first businesses face the challenge of understanding and managing global tax and compliance matters as they grow and scale internationally.
Dublin, Ireland-based Fonoa entered. The startup was founded by three ex-Uber alumni, Davor Tremac, Ivan Ivankovicz and Filip Sturman, and has developed an application programming interface that helps digital companies determine and calculate taxes they should collect on their internet sales.
As more goods and services are sold online, Fonoa has raised a $20.5 million Series A round. Its customers are mostly from the ride-Hailing, Mobility, food delivery, SaaS and e-Commerce industries.
CEO Tremac says that Fonoa's APIs is easy to integrate with customer's existing data so that they don't have to spend hours figuring out tax matters manually. Demand for its automated offering has grown, as the company has surpassed 300 million tax transactions per year. The company has seen 7x revenue growth since December 2020, and has a very healthy margin.
Businesses and their customers transact on a global scale in the digital world. He said that country borders are no longer a limiting factor and that technology drives global trade at an ever-increasing speed. With the increased scrutiny by regulators, dealing with tax matters in a more automated and trusted way has become an ever more pressing issue.
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The image is called "Fonoa."
The COVID-19 epidemic brought online commerce to the area, which accelerated the growth of Fonoa.
More sales happening online means more work for us as each online transaction has to have a tax component.
The Series A financing included participation from Index Venture and Moving Capital. The seed round was not previously announced. Other backers include Kevin Hartz, the founder of Eventbrite, and Prabir Adarkar, the CFO of DoorDash.
It is difficult to calculate and report taxes in the world. They wanted to develop technology that would automate taxes for the internet economy.
Fonoa currently supports tax automation transactions across more than 100 countries and has the goal of expanding to over 140 countries by the end of the year with the help of its new capital. The money will be used to hire. Although it is based in Dublin, Fonoa is remote-first, with a 60-person distributed team working in 15 countries. It is looking to hire 60 people in the U.S., Europe, Asia and LatAm across engineering, product, sales, recruiting and operations. The company plans to use the funds to extend the coverage of current products as well as to build completely new ones.
He said that they were doubling down on growth as the opportunities were massive. We will keep expanding until we cover all relevant use cases.
Hannah Seal believes that Fonoa unlocks growth for companies that operate internationally, and would otherwise bebogged down by the complexity of national tax regimes.
Seal wrote via e-mail that the focus on enabling growth, not simply back-office automation, attracted them to Fonoa. The team has a deep understanding of the challenges of scaling across borders and has developed products that allow companies to add and expand new geographies.
Jambu Palaniappan is the managing partner of OMERS Venture.
He wrote via email that they focused on the full tax stack from validations to real-time reporting and put technology rather than consulting at the core of their product. With governments around the world more concerned than ever about compliance, now is the perfect time for Fonoa to build a globally relevant platform.
