Cloud accounting software provider Wave Accounting has secured $12 million in venture capital financing, with plans to establish a physical U.S. presence and enhance the product for its core market of freelancers, entrepreneurs, sole proprietors and small business owners.
Wave claims to have over 250,000 users to the free product since its November 2010 inception, half of which are in the U.S. However, the company up until now has not had a U.S. office and would like to utilize some of the funding to grow its user base, awareness and physical presence here.
“We have for the most part flown under the radar, but are signing more customers in the U.S. every day and it will be a core focus to gain more awareness in U.S. market,” said Wave’s chief executive and co-founder Kirk Simpson. “Every company is about recruiting the best possible talent so we do want to have a bigger presence here in the U.S. and also serve the growing numbers of customers outside the U.S. as well. Most importantly, we want to deliver on the vision of getting the back office stuff out of the way for our core user base so businesses can focus more on their success.”
Simpson recognized the growing competition in cloud accounting, particularly those targeting the 0-9 employee space as Wave does but he claimed it only “validates” the space they are in. He said to expect more product enhancements, particularly around its core bookkeeping engine to come in the next 12 to 18 months as well as growth in its payroll business.
In February the company launched Wave Payroll, which initially targeted Canadian users, with a U.S. version planned later this year. The company plans to grow that business and is also looking into office space for U.S. operations in the San Francisco and Silicon Valley area.
Ultimately, Simpson said he believes that his target market is still underserved and there is potential for Wave to take a lead; especially if the product remains free and easy to use.
“We have a core believe that for our market we are playing in the right space; we focus on simplicity and ease of use and plus it’s a free accounting product,” said Simpson. “You still have 60 percent of companies with nine employees or less using spreadsheets and the fact that they are going to go out and spend $10 to $40 a month on something they don’t like doing is a disconnect. Traditionally, desktop accounting products have been difficult to use, especially for these types of business owners, and we want to use our proceeds to go as deep as we can to get the product to do everything we want it to do for them.”
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