Numeric Secures $28M Series A to Revolutionize Accounting with AI
Month-end and quarter-end financial closings are often daunting for accountants, as they involve labor-intensive, error-prone manual tasks. In 2020, Parker Gilbert, frustrated by these inefficiencies while managing finance and accounting at a startup, co-founded Numeric to address this challenge. Numeric is an innovative accounting software that automates significant portions of the book-closing process. With the integration of generative AI, Numeric has enhanced its capabilities, gaining traction among major companies such as Brex, OpenAI, Plaid, and Wealthfront.
Over the past year, Numeric has experienced rapid growth, with revenues increasing fourfold to reach several million dollars. The company has also attracted substantial investor interest. Only five months after securing a $10 million seed round, Numeric has raised $28 million in a Series A led by Menlo Ventures, with additional investments from IVP, Socii, and existing backers like Founders Fund, Long Journey, 8VC, Friends & Family Capital, and Fifth Down.
Numeric’s platform helps accounting teams cut down on the time required for monthly book closings by aggregating and reconciling data from various systems, including Excel. It employs an AI agent to monitor changes in line items month-over-month. If it detects anomalies, it provides explanations, saving accountants valuable time they would otherwise spend on variance analysis, also known as flux analysis.
Gilbert shared a practical example: If Numeric’s AI notices a spike in legal expenses from one month to the next, it might provide an explanation like, “Your legal expenses increased this month due to a higher payment of $X to Wilson Sonsini for funding activities.” This automation enhances efficiency while allowing accountants to verify AI-generated insights through provided links.
Concerns about AI hallucinations in the flux analysis are addressed by Gilbert, who assures that Numeric includes verification links to allow accountants to review the AI’s findings.
Though Numeric currently doesn’t use generative AI for calculations and reconciliations, Gilbert expects their model will soon handle these tasks accurately. He believes that large language models (LLMs) are adept at synthesizing large datasets and will only improve over time.
Croom Beatty, a partner at Menlo Ventures, expressed his enthusiasm for Numeric, describing the startup as one of the first in the field to capture his attention. He emphasized that Numeric has a distinct advantage in the market by integrating complex workflows with intricate data, in a field that tech companies have underserved. Beatty foresees Numeric expanding its product line to include financial planning and analysis features, potentially competing with industry leaders like Anaplan.
Numeric is up against established players like BlackLine and FloQast, with the latter valued at $1.6 billion following its recent Series E. However, Beatty suggests that Numeric’s innovative approach and complexity make it challenging for others to replicate.
With this new capital infusion, Numeric plans to refine its offerings and strengthen its competitive edge within the AI-driven accounting software market.
Source: https://techcrunch.com/2024/10/10/numeric-grabs-28m-series-a-for-automating-accounting-with-ai/
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