The leaders of Employer.com, an HR tech company, hadn't considered acquiring Bench Accounting, an online bookkeeping services provider, until they heard the fintech was shutting down. Six hours later they were in talks to buy it and four days later — January 1st — they closed the deal.
"I personally had never even heard of the company; the first I heard of it was Saturday around midnight," said Matt Charney, chief marketing officer of Employer.com, a San Francisco-based company that also owns Recruiter.com and Bountyjobs.com.
Jesse Tinsley, CEO and owner of Employer.com, was on vacation with his family in Florida when an industry contact tagged him and Charney with the news and suggested Bench might be worth acquiring. Tinsley immediately got on the phone to inquire about it, according to Charney.
Terms of the deal have not been disclosed. Employer.com is now the sole owner, and none of the previous investors in Bench now have stakes in the business, Charney said.
Employer.com is also finalizing a deal to purchase another recently closed fintech, New York-based Level, a dental and vision benefits technology provider, he said. That proposed deal is for $30 million in cash and stock, according to a source familiar with the negotiations.
Bench, based in Vancouver, British Columbia, was attractive because it provides cross-selling opportunities with Employer.com's services and clients.
"This was a company that we could incorporate into our existing offerings and do so without a lot of heavy lifting," Charney said. Bench collects bookkeeping information from its clients and provides them with bookkeeping, tax-preparation services and a comprehensive financial overview via its own technology and its own human bookkeepers.
The Bench acquisition will also enable Employer.com to expand into the Enterprise Resource Planning realm: software that integrates all the processes needed to run a company, he said. Employer.com's previous acquisitions were in HR technology and payroll services. The company also provides bank accounts and debit cards.
"The ability to offer the accounting and bookkeeping services truly moves us from an HCM (human capital management) play into a larger ERP play," Charney said. "It's exciting for us to not only be able to offer those services to our current customers, but also to be able to have potentially 12,000 new customers for our payroll and some of the HR services that were not included as part of Bench's core offering."
Similarly, the pending acquisition of Level's benefits technology "fits beautifully into our HR business" and its artificial-intelligence-led expense management tech that categorizes expenses and flags inconsistencies would "uplevel the capabilities of Bench," Charney said. Employer.com had been looking to buy a benefits administrator/provider since October, he said.
Employer.com doesn't yet know how many of Bench's 12,000 U.S. customers it will be able to retain, but the new owner has been in contact with the customers and promised that all outstanding contracts and pricing will be honored, Charney said. Employer.com has also reached out to Bench's 600 employees in hopes of retaining them, though the number of employees who remain will depend on how many customers stay.
"Obviously, we're going to undergo some churn and there's been 48 hours where there was some concern on the market," Charney said. "We actually started onboarding their staff prior to the close and obviously we believe that with the relationships that Bench has built with the internal bookkeepers and clients, we understand how important that is."
Several key leaders and staff at Bench, as well as Bain Capital Ventures and iNovia Capital — two of its venture capital investors — helped Employer.com close the transaction, he said.
The angry reaction of Bench's customers to its sudden closing was another reason why Bench was an attractive acquisition target, Charney said. Their venting on social media showed that "they have a very loyal customer base that really loves that product," he said.
Bench had announced on Dec. 27 that its platform was no longer accessible. In addition to the poor timing of the announcement — just days before year end — customers complained that they had had no prior notice that the company was shutting down.
Charney declined to comment about why Bench had shuttered. The company's CEO, Jean-Philippe (J.P.) Durrios, left in November, according to his LinkedIn profile.
Bench had once proclaimed its mission as making "a profound difference in the quality of life of 1 million people" and touted itself as America's largest bookkeeping service for small businesses. In 2021, it raised its last major round of venture capital — $60 million in series C financing — bringing its VC total to about $100 million. At the same time, Bench rolled out a "financial toolkit" for customers that included business bank accounts and debit cards in addition to its bookkeeping, payroll and tax preparation services. Employer.com already offers bank accounts and debit cards, Charney said.
Later in 2021, Bench's CEO and co-founder Ian Crosby was fired, just after the company had just turned down "a highly lucrative acquisition offer," he reported on LinkedIn late last month.
Employer.com's owner, Tinsley, started Job Mobz, a recruiting-as-a-service firm, in 2012 and acquired smaller staffing companies before acquiring Recruiter.com Ventures, a Nasdaq-listed recruiting services tech platform, last year. Later in 2024, he acquired Employer.com — a provider of international payroll, staffing and compliance services — for $450,000.
Employer.com expects to close at least two acquisitions in January, Charney said, and the company will be focused on acquiring more businesses that provide "post-employment" services to companies.
"We will continue to look at any company that has either a better technology offering than we can provide in some of these point solutions, or closes the capability gap, or has employees who fit in with our roadmap," he said. "We're very acquisitive."
