news 
Failed fintech startup Bench racked up over $65 million in debt, documents reveal
In a stunning turn of events, accounting startup Bench has revealed in recent bankruptcy filings that it accumulated an astonishing $65.4 million in liabilities before its sudden shutdown and sale to HR tech company Employer.com.
The alarming figure comes despite the fact that the startup had reportedly raised a substantial $113 million from investors such as Shopify and Bain Capital Ventures since its founding in 2012. The majority of this debt, amounting to $50 million, is owed to the National Bank of Canada, one of the country’s largest commercial banks.
According to documents seen by TechCrunch, Bench had only $2.8 million in assets at the time of its bankruptcy filing, leaving a significant shortfall in its ability to pay off outstanding debts. The company’s rapid descent into insolvency is all the more surprising given its reportedly robust annual recurring revenue of $50 million.
As Benchmark navigates the complex process of liquidation, it is also expected to transfer valuable assets and intellectual property to Employer.com, which will oversee the distribution of proceeds to creditors once the proceedings are complete. Gary Levin, head of corporate development at Employer.com, emphasized in a statement that his company’s strong balance sheet allows for significant investment in Bench moving forward.
The startup’s dramatic collapse serves as a stark reminder of the risks and challenges inherent in the fintech sector, particularly when it comes to accounting and financial services.
Source: techcrunch.com
