Accounting
How a once-hot accounting fintech’s bet on AI led to bankruptcy
Bench Accounting, like many fintech startups, had ambitions to shake up a boring but important corner of finance — in this case, bookkeeping for small businesses.
It racked up more than 10,000 clients in a little over a decade and seemed well on its way. Yet that wasn’t fast enough to make it the hot fintech it aspired to be when it raised over $100 million in venture financing. In a final push to improve its business, Bench turned to tech’s favorite new go-to: AI. It laid off staff and introduced new automation programs, including a bot named BenchGPT.
It all culminated in nothing short of a disaster, punctuated by a troubled 2023 tax season when the company needed to request extensions for many of its clients, according to former employees. The next year was no better. As 2024 ended, Bench told clients it couldn’t handle their books. This January, the company
“It’s literally days before year-end and I don’t know what my books look like,” former Bench client Sam Plester, chief executive officer and founder of Mission Brands Consulting in Madison, Wisconsin, said during an interview in December, adding that he had to pay a different firm to redo his books.
Bench’s downfall is a cautionary tale for companies in a hurry to use AI to transform their business. The episode capped a year of
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This account of Bench’s challenges is based on interviews with more than a dozen current and former executives, employees and investors in the company who asked not to be named discussing its internal affairs, as well as documents provided by them.
Internal challenges
By late 2021, former Bench executives say the company was garnering $35 million in revenue and growing 40% annually. Yet, it still wasn’t profitable; its automation efforts required investment, and the small business segment is marked by
Despite this, Ian Crosby, co-founder and former CEO of Bench, was in talks that year to receive an acquisition offer valued between $200 million and $300 million from business banking startup Brex, technology publication Newcomer
With fresh cash in the bank, Bench tripled the size of its engineering, product and design team to build the next iteration of the business. It began burning through that cash — spending about $1.5 million per month at its peak, according to a former executive. A few months after the 2021 funding round closed, board members approached Crosby with concerns, according to people familiar with the discussions. Instead of straying too far from the core bookkeeping business by expanding into banking services, board members thought Bench should use the new funding to focus on achieving profitability. The board insisted the goal should be slashing one of the company’s biggest expenses: bookkeepers, the same people said.
In the months following the June funding round, Crosby and board members clashed over whether to continue gradually automating processes, bet big on automation or move ahead with the expansion into banking services, according to former executives. On Dec. 1, 2021, Crosby was removed as the company’s CEO, according to people close to the discussions. He declined offers to stay on the board or take a different executive position and exited the company, they said.
In August 2022, Bench Chief Financial Officer Jean-Philippe Durrios was promoted to CEO. By this point, a significant portion of the $30 million in series C equity funding had been spent, according to people familiar with the company’s operations. Durrios did not respond to requests for comment.
AI rollout
Durrios’ tenure was defined by an intense focus on profitability, according to former executives. In the first two years under his leadership, Bench’s 613-person staff underwent multiple rounds of layoffs. By the time it filed for bankruptcy, Bench had 413 employees.
In mid-2023, Durrios implemented a strategy designed to increase the efficiency of the bookkeepers by splitting them into specialized teams and arming them with AI tools. Under the new model, associates took over client communications despite no longer performing the bulk of the bookkeeping services themselves. The number of clients they were responsible for swelled from the 70 or so they handled completely, to roughly 200 for which they only fielded questions, according to former employees. Shortly after the reorganization, about 40 bookkeepers were laid off, a former executive said, adding strain to the implementation.
Bench hired outsourcing firm HJS Accountants and promised that upcoming AI product launches would make everything run smoothly. One of these new programs was called BenchGPT, an internal tool for employees to ask questions about client needs. The tool proved to be unreliable, according to a former employee. Bench launched a similar chatbot tool for clients designed to help with expense categorization, but it was often inaccurate and its entries needed to be manually fixed, two employees said. HJS Accountants did not respond to a request for comment.
As with most AI product launches, the tools gradually improved, but weren’t live in time to support the pared-down bookkeeping team for the 2023 tax season, according to former employees. For that year, Bench was unable to meet filing deadlines and requested extensions for a significant portion of its clients, the same people said. The company needed to rehire bookkeepers, adding additional financial pressure.
Meanwhile, people familiar with the company’s operations say Bench was frequently facing cash shortages and leaned on bridge rounds of venture funding and debt to continue operating. During Durrios’ tenure, Bench paid off its debt from Bank of Montreal and obtained an increased credit line from National Bank of Canada, the same people said.
Last fall, Durrios told the board that the business needed money again. They responded with additional funding and sent Adam Schlesinger from Inovia Capital to evaluate the state of the business. In October, Schlesinger was appointed to replace Durrios as CEO while the board searched for a buyer for Bench. However, Bench had breached terms attached to its line of credit, according to people who were present and asked not to be named discussing confidential information.
On Dec. 27, Bench posted to its website that it was closed for business and recommended clients turn to a competitor, Kick. In January, Bench Accounting Inc. and 10Sheet Services Inc., which operated as a consolidated business, filed for bankruptcy with an accumulated deficit of $135 million, according to a report by the trustee, KSV. National Bank of Canada did not respond to requests for comment. Bank of Montreal declined to comment.
Accounting
Developing future leaders in accounting: the new imperative in an AI and automation driven era
As technology continues to automate routine tasks, the role of finance professionals is evolving, demanding deeper capabilities in critical thinking, communication and business acumen.
Many of PrimeGlobal’s North American firms are focused on cultivating these skills in their future leaders. Carla McCall, managing partner at AAFCPAs, Randy Nail, CEO of HoganTaylor, and Grassi managing partner Louis Grassi shared their views with PrimeGlobal CEO Steve Heathcote on the need for future leaders to balance technological proficiency with human-centered skills to thrive.
AI is transforming the sector by streamlining workflows, automating data analysis and reducing manual processes. However, rather than replacing accountants, AI is reshaping their roles, enabling them to focus on higher-value tasks. In the words of Louis Grassi, AI can be seen as a strategic partner, freeing accountants from routine tasks, enabling deeper engagement with clients, more thoughtful analysis, and ultimately better decision-making.
Nail emphasized the importance of embracing AI, warning that those who fail to adapt risk being replaced by professionals who leverage the technology more effectively. HoganTaylor’s “innovation sprint” generated over 100 ideas for AI integration, underscoring why a proactive approach to adopting new technologies is so necessary and valuable.
McCall advocates for an educational shift that equips professionals with the skills to interpret AI-generated insights. She stressed that accounting curricula of the future must evolve to incorporate advanced technology training, ensuring future accountants are well-versed in AI tools and data analytics. Moreover, simulation-based learning is becoming increasingly crucial as traditional methods of education become obsolete in the face of automation.
Talent development and leadership growth
As AI reshapes the profession, firms must rethink how they develop and nurture their future leaders. To attract and retain top talent, firms need to prioritize personalized development plans that align with individual career goals.
HoganTaylor’s approach to talent development integrates technical expertise with leadership and communication training. These initiatives ensure professionals are not only proficient in accounting principles but also equipped to lead teams and navigate complex client interactions.
Nail underscored the growing importance of writing and presentation skills, as AI will handle routine tasks, leaving professionals to focus on higher-level analytical and decision-making responsibilities.
Soft skills are the success skills
While technical proficiency remains vital, future leaders must also cultivate critical thinking, communication and adaptability — skills McCall refers to as the “success skills.” McCall highlights the necessity of business acumen and analytical communication, essential for interpreting data, advising clients and making strategic decisions.
Recognizing teamwork and collaboration remain crucial in the hybrid work environment, McCall explained in detail how AAFCPA fosters collaboration through structured remote engagement strategies such as “intentional office time,” alcove sessions and stand-up meetings. Similarly, HoganTaylor supports remote teams by offering training for career advisors to ensure effective mentorship and engagement in a dispersed workforce.
McCall emphasized why global experience can be valuable in leadership development. Exposure to diverse markets and accounting practices enhances professionals’ adaptability and broadens their perspectives, preparing them for leadership roles in an increasingly interconnected world.
Grassi reminded us that an often-overlooked leadership skill is curiosity. In his view the most effective leaders of tomorrow will be inherently curious — not just about emerging technologies but about clients, market shifts and global trends. Encouraging curiosity and continuous learning within our firms will distinguish the true industry leaders from those simply reacting to change.
A balanced future
What’s clear from speaking to our leaders is PrimeGlobal’s role in fostering trust, community and knowledge sharing. McCall recommended member-driven panels to discuss AI implementation and automation strategies and share best practice. Nail, on the other hand, valued PrimeGlobal’s focus on addressing critical industry issues and encouraged continuous evolution to meet professionals’ changing needs.
The future of leadership in the accountancy profession hinges on a balanced approach, leveraging AI to enhance efficiency while cultivating essential human skills that technology cannot replicate, which Grassi highlights skills including leadership and building client trust.
As McCall and Nail advocate, the next generation of accountants must be agile thinkers, skilled communicators and strategic decision-makers. Firms that invest in these competencies will not only stay competitive but will also shape the future of the industry by developing well-rounded leaders prepared for the challenges ahead.
By investing in both AI capabilities and essential human skills, firms can not only future proof their leadership but also shape a resilient and forward-thinking profession ready to meet the challenges of the future.
As Grassi concluded, while technical skills provide the foundation, leadership in accounting increasingly demands emotional intelligence, empathy and adaptability. AI will change how we perform our work, but human connection, trust and nuanced judgment are irreplaceable. Investing in these human-centric skills today is critical for firms aiming to build resilient leaders of tomorrow. To remain relevant and thrive, professionals must prioritize developing strong success skills that will define the leaders of tomorrow.
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Employment rose by a stronger than expected 228,000 jobs in March, although the unemployment rate inched up one-tenth of a point to 4.2%, the U.S. Bureau of Labor Statistics reported Friday.
Despite the mostly upbeat jobs report, the stock markets nevertheless plunged amid widespread concern over the
The professional and business services sector added 3,000 jobs, but lost 700 jobs in accounting, tax preparation, payroll and bookkeeping services. The biggest job gains occurred in health care, social assistance, transportation and warehousing. Employment also grew in the retail trade industry, in part due to the return of workers from a strike in the food and beverage industry. But federal government employment declined by 4,000 in March, after a loss of 10,000 in February, amid job cuts ordered by the Elon Musk-led Department of Government Efficiency. However, the Internal Revenue Service is
Average hourly earnings rose in March by 9 cents, or 0.3%, to $36.00. Over the past 12 months, average hourly earnings have increased 3.8%.
Trump boasted about the jobs report in an all-caps
Congressional Democrats disagreed. “Unemployment is rising, and this seems to be the last report buoyed by Democrats’ blockbuster job creation,” said House Ways and Means Committee ranking member Richard Neal, D-Massachusetts, in a statement. “Recession odds are getting higher by the day as Trump plagues our economy with the largest tax hike in decades. Wages would need to skyrocket for the people to weather Trump’s higher prices and needless uncertainty. This report doesn’t yet reflect the dangerous firings of thousands of public servants or the layoffs that started hours after he announced the Trump Tariff Tax. This administration is ruling through the lens of billionaires — sacrificing workers’ paychecks, destroying trillions of dollars in savings and retirement wealth, readying
Economists are predicting fallout from the historic tariff increases announced by Trump. “We now have more clarity on the trade policy following ‘Liberation Day’ on April 2,” wrote Appcast chief economist Andrew Flowers. “The average effective tariff rate is now above the level set by the Smoot-Hawley tariffs in 1930. This is one of the largest changes to economic and global trade policy since President Nixon’s decision to move away from the gold standard more than 50 years ago. The impending fallout from retaliatory tariffs from our trading partners across Europe and Asia will radically shift employment growth across manufacturing, retail and construction as consumer goods prices rise.”
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