Dublin-headquartered API-first global tax automation service Fonoa has raised $25 million in order to support its ambition of adding 40+ more countries to its compliance list within the next 43 days. Additionally, the capital will power international expansion goals and job creation across all areas of the business.
If the pandemic showed (is showing?) us nothing else, global commerce is here to stay. While it might be great for digital-first businesses, it isn’t so great for the accounting department, as they’re required to understand, manage, and comply with global tax obligations. What’s true for sales in one country might not be the same for another. Shift that to another continent, and you’re dealing with perhaps an entirely different set of rules. Existing automation options are scarce, with a whole lotta manual labour being exerted into the process.
And you just know that governments aren’t going to be shifting the explanation of their taxation systems to suit the economy anytime soon. To serve the people, right?
This is where Fonoa steps in and assists marketplaces, digital service providers, micromobility operators, gig economy platforms, and subscription-based companies in managing their compliance, transforming a costly and labour-intensive process into an automated and seamless one.
“In the digital world, businesses and customers transact on a global scale. Country borders are no longer a limiting factor, and technology drives global trade at an ever-increasing speed,” explains CEO and co-founder Davor Tremac (ex-uber). “Combined with the increased scrutiny by regulators, dealing with tax matters in a more automated and trusted way has become an ever-more pressing issue. We built a one-stop solution that handles the complexities of tax globally, allowing digital businesses to focus on growing their core business.”
Fonoa’s services incorporate tax compliance in over 100 countries, and client list includes some heavy hitters including Lime, GoStudent, Teachable, Uber, and Zoom, and uses a relatively simple API solution that plugs into existing workflows. Laying in the background, Fonoa verifies the tax status of a buyer and a seller, calculates the correct tax to charge, and outputs a locally compliant invoice post-sale. Currently, the company is seeing more than 300 million tax transactions per year pass through its doors
Fonoa’s funding was provided by Index Ventures, OMERS Ventures, FJ Labs, and Moving Capital. Angel investors include Gautam Gupta (former COO and CFO at Opendoor and Uber), Kevin Hartz (founder at Eventbrite), Prabir Adarkar (CFO at Doordash), Carlos Gonzalez-Cadenas (former COO at GoCardless), Allison Barr Allen (COO at Fast), and others.
On the investment, Index Ventures’ Hannah Seal commented, “The Fonoa team has identified and solved a genuine problem for businesses, with a product that enables businesses to manage their tax obligations seamlessly through one API. There's a whole category of modern payment solutions which have become the norm, but the innovation and caliber of software solutions around tax have been nowhere near the same standard. Fonoa plans to change all of that.”