The round was led with $300,000 from Cincinnati-based CincyTech after the Sqrl team completed the summer round of the city’s Brandery business accelerator. Other investors include Hyde Park Venture Partners and Vine Street Ventures.
Sqrl, which started life last year as Accrew LLC, was founded by Ryan Watson, Ryan Baker and Craig Baldwin.
The product does a seemingly simple task – gather information and financial documents from clients – over which accountants have been tearing their hair out.
John Venturella, chairman of tax services at Dayton-based Clark Schaefer Hackett & Co., explained via email: “In accounting firms, influencing the flow of client information – how and when it comes in – is called managing ‘the front door.’ And the front door is paramount to efficiency. The traditional way for an accounting professional to respond to trickling-in information is by manually tracking each item’s arrival, then repeatedly following up with the client to gauge how and when the rest will arrive. Minding the front door is time-consuming and inefficient.”
Clark Schaefer hasn’t seen another product that tries to solve the problem all at once, he said, so it’s among the testers.
Here’s how the product was born:
The three founders all left corporate accounting jobs in 2012 to form Upsourced Accounting, targeting millenials who are starting businesses and are comfortable working with technology and a virtual presence. The firm grew to 50 clients within 10 months.
“As we were having all that growth, we weren’t as profitable as we should have been,” Watson said.
They were spending twice as much time on unbillable work – gathering basic client information and documents – as they were accounting. Finding no available solution off the shelf or in other accounting firms, they built a product and spun off Accrew a year ago.
Going through the four-month Brandery program completely changed the product and the brand. Where Accrew was a platform both accountant and client had to log into, Sqrl just sends clients emails and automates reminders and tracking receipt of info.
The brand conveys an electronic hunter-gatherer.
“We really redefined our value proposition,” Watson said.
Baker still runs Upsourced Accounting, while Watson and Baldwin focus more on Sqrl. To comply with Brandery requirements, they incorporated the spinoff in Cincinnati and Baldwin moved there, but Watson and the guts of the business remain in Upsourced’s Short North office.
For now, clients are getting the product for free. The company will roll out premium subscription features in coming months. The investment gives it 18 months of runway while the company markets itself and adds clients. After that, they founders may seek a Series A funding round.
Watson projects up to $50,000 in monthly revenue by year’s end.
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