Summary:
Numeric raised a $28 million Series A led by Menlo Ventures after previously securing $10 million in seed funding.
The software automates parts of the book-closing process, significantly reducing time spent by accounting teams.
AI identifies changes in accounts and provides explanations, streamlining the flux analysis process.
Concerns about AI hallucinations are mitigated by providing verification links for accountants.
Numeric competes with BlackLine and FloQast, but its complex model sets it apart in the market.
Transforming Accounting with AI
Accountants typically dread month-end and quarter-end closings due to the manual, error-prone, and time-consuming nature of finalizing financial records. In 2020, Parker Gilbert, frustrated with these challenges at an early-stage startup, co-founded Numeric, an innovative accounting software aimed at automating parts of the book-closing process.
With the recent advancements in generative AI, Numeric has significantly enhanced its capabilities, now serving the accounting departments of notable companies like Brex, OpenAI, Plaid, and Wealthfront.
Rapid Growth and Investment
In just a year, Numeric's revenue has soared fourfold to single-digit millions. Following a $10 million seed round just five months ago, the company has successfully raised a $28 million Series A led by Menlo Ventures, with participation from IVP, Socii, and previous backers like Founders Fund and 8VC.
Streamlining Book-Closing Processes
Numeric allows accounting teams to reduce their monthly book-closing time significantly. The software aggregates and reconciles data from various accounting systems and Excel spreadsheets, overlaying it with an AI agent that identifies changes month-over-month. If outliers or unexpected variations are detected, the AI explains why these changes occurred, saving accountants valuable time that would otherwise be spent on flux analysis.
For instance, if legal expenses rise, the AI might state, “Your legal expenses went up this month because you paid Wilson Sonsini $X amount more for your funding.”
Addressing AI Concerns
While concerns about AI hallucinations in the flux analysis commentary exist, Gilbert assures that Numeric provides links for accountants to verify the AI's work at any time. While generative AI does not currently perform the calculations, Gilbert believes it will soon be capable of doing so accurately, as large language models (LLMs) continue to improve.
Competitive Landscape
Croom Beatty of Menlo Ventures highlights Numeric's unique position, noting that it combines complex workflow with intricate data in an underserved market. He anticipates future product expansions into areas like financial planning and analysis.
Numeric competes with established players like BlackLine and FloQast, but Beatty emphasizes that Numeric's approach is complex and not easily replicable, which sets it apart in the accounting software landscape.
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