AI is an imperfect technology, but one task it excels at is identifying patterns in vast amounts of data. Perhaps this is why several start-ups have emerged in recent years offering AI-powered products aimed at automating accounting tasks, such as drafting sensitive information on paperwork and filing forms across different departments. Simply put, it’s low-hanging fruit.
That’s not to suggest that accounting-focused AI isn’t profitable, quite the contrary. As something of a case in point, vic.aiwhich bills itself as an accounting automation platform, announced today that it has raised $52 million in a Series C funding round led by GGV Capital and ICONIQ Growth with participation from Cowboy Ventures and Costanoa Ventures.
The new cash brings Vic.ai’s total raised to $115 million, which CEO Alexander Hagerup says is going toward customer acquisition in North America and adds purchase order matching, payment execution and “intelligence” capabilities. of expenses” to the Vic.ai platform.
“In this next stage of growth, Vic.ai will capitalize on the urgent market need to automate other elements of finance by expanding its AI solution to manage and analyze all of these tasks,” Hagerup told TechCrunch in an interview by email. “’AI’ has been a hot concept for many years, but large companies are only now getting to the point where they’re ready to adopt at scale, and they’re doing so with a focus on specific functions like accounting and finance. .”
Vic.ai was founded in 2017 by Hagerup and Kristoffer Roil, both Norwegian entrepreneurs. Before co-launching Vic.ai, Hagerup founded the Online Backup Company, a European provider of backup and disaster recovery services. Roil spearheaded the founding of Telipol, a wireless operator in Norway that was later acquired by the Hudya Group, a Nordic fintech company.
Hagerup and Roil say they built the first iteration of Vic.ai by training the platform on historical accounting data and processes from tens of thousands of public companies. The training dataset contained accounting documents and corresponding journal entries that were reviewed by accountants at consulting firms, including PricewaterhouseCoopers. This “live use” helped train Vic.ai’s machine learning algorithms over time, according to Hagerup, allowing it to provide almost “complete autonomy” for transaction processing.
Vic.ai primarily handles invoice processing, leveraging the aforementioned algorithms to select invoices and expenses that meet a certain confidence threshold and automatically send them to approvers. The platform also determines the number of steps in an invoice approval process and automatically decides which employee should review each step.
Hagerup says that Vic.ai uses the invoices it processes for clients to improve the performance of its algorithms. Data on the platform is retained for seven years, but Vic.ai maintains a “strict separation” of US and EU data to comply with the GDPR and strives to screen out personally identifiable information, he says. .
Unlike some AI vendors, Vic.ai is lucky to occupy an industry that is beginning to embrace automation. A 2021 survey of roughly 200 businesses and financial institutions found that while management priorities and IT availability remain top barriers to automated workflows, just over a third of respondents said they planned to spend.” more or significantly more” in accounts payable automation technology. within the next two years.
Vic.ai’s customer base reflects this. According to Hagerup, the company now has 60 enterprise customers, including HSB, Intercom and Armanino, with an active user base growing 280% compared to 2021. Vic.ai’s contracted annual recurring revenue tripled in 2022 compared to 2021 (5 million dollars). he added.
“As a true AI company, Vic.ai is transforming accounts payable automation into true autonomy. While some of our competitors offer rule- and template-based solutions, our unique approach sets us apart from the status quo,” Hagerup said. “Moving routine manual on-premises operations via email or spreadsheet to a cloud-based solution with audit trails and compliance features is favorable for IT C-level managers… We are well positioned for an economic recession.
Vic.ai competes with providers like upflow, collect AI and owned by Quadient YayPay in the accounts receivable management and automation space. (For context, the accounts payable automation market alone is estimated to grow from $1.9 billion in 2019 to $3.1 billion by 2024, according to MarketsandMarkets.) Tipalti is perhaps the most formidable, as it has raised $270 million at a valuation of $8.3 billion last December.
To beat out rivals, New York-based Vic.ai has expanded rapidly — it tripled its headcount to 106 employees this year — and invested in developing its AI-powered purchase order matching technology, which it sees as a differentiator. key code.