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Until six year ago , many e - commerce and SaaS businesses could have avoided paying sales tax to states where they had customer , but no physical presence . But as on-line shopping grew , states realized they were losing out on tax taxation .
The era of free - equitation for online retailers terminate in 2018 when South Dakota took Wayfair to court over sale tax collection . The Supreme Court at last side with South Dakota .
Now , on-line storage and SaaS companies have to collect sales revenue enhancement from their customers wherever it ’s required , which is not an easy chore given that tax lawsvary significantlyby city , county and state .
Rohit Bhadange , who worked in venture capital and individual fairness , identified sales tax compliance as a major pain point for e - DoC and SaaS businesses . So , about 18 months ago , he launchedZamp , a inauguration whose software program can automatically calculate and file sales taxes for businesses of all size of it .
Since then , Zamp has grow its client base to over 400 ship’s company and attain annual recurring revenue in the mid - one thousand thousand , concord to Bhadange . The fast increment captivated investors .
On Thursday , Zamp announced a $ 10 million Series A led by Valor Equity Partners with participation from Venus Williams , Day One Ventures and other investor .
In summation to spread out its e - commercialism and SaaS client base , Zamp has get to partner with accounting firms cope with a natural endowment dearth due to declining interest in the profession . The troupe ’s method of accounting firm clients includetop 25 U.S. accounting firmsBaker Tilly and Withum .
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Accounting firms are under increased atmospheric pressure to wait on client with sale revenue enhancement compliance , particularly as states intensify their taxation audit , Bhadange said . “ You have this perfect storm where enforcement is increasing ; taxation obligingness is increasing , [ but the number of ] accountant is decreasing . ”
To run across that demand , Zamp is introduce a unexampled mathematical product calledZ - tax , which helps accountant and bookkeeper supply sales tax services without increase their headcount .
“ We want them to focalise on high value advisory service while we manage the intact sales tax process on the back end , ” Bhadange said .
Zamp is not alone in the food market for sales tax obligingness solutions for startup , particularly SaaS businesses . Its primary competitor is Anrok , backed by Khosla Ventures and Sequoia . Anrok , base four years ago , may be slightly old and larger — having latterly evoke a $ 30 million Series B — but Zamp ’s rapid growth indicates there is room for multiple players in this space .
