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Tracking R&D tax credits is manual, tedious, and time-consuming, and companies typically don’t keep track of which employee did what and for how long, co-founder and chairman of Boast.ai Lloyed Lobo Crunchbase News said. In 2019, more than an estimate $ 18 billion in R&D credits were reported by companies, according to a financial advisory firm BDO.
“Companies incur R&D expenses throughout the year, but see no financial benefit for 16 months or more, because they cannot claim the credits until they have filed taxes,” Lobo said. “We automate data collection to identify, categorize and track eligible projects over time, which gives an estimate of the time spent in R&D. You use your R&D to grow without giving up your equity.
The $ 100 million credit facility will allow Boast.ai to give money to businesses so they don’t have to wait for tax credits. In return, the borrowing company repays the loans with interest.
Rather than having to pay multiple times a year to use the platform and return the credits, Boast.ai will create an all-encompassing royalty that the company will pay. These fees will usually be lower than taking out a loan or paying an accounting firm to compile the data, Lobo said.
The new funding follows a $ 23 million Series A fundraising round in December, led by Capital in radians, bringing the company’s total funding to $ 123 million since its inception in 2012, according to data from Crunchbase. Before that, the company was primed, Lobo said.
Douglas monticciolo, co-founder and CEO of Brevet Capital, said in a written statement that R&D tax credits are an “untapped resource for companies looking to invest and accelerate innovation.”
“R&D tax credits are a valuable form of capital, but delays can be extremely difficult for start-ups,” Monticciolo said. “Boast.ai’s AI-powered funding platform eliminates these delays and allows startups to focus on creating new solutions and products while immediately reaping the benefits of their hard-earned R&D efforts. “
Boast.ai claims to have worked with over 1,000 companies to recover R&D costs from the US and Canadian governments, streamlining the process and reducing the risk of costly audits.
The company claims to have doubled its turnover from one year to the next. If all of his customers use Boast.ai’s new cash advance offering, Lobo expects to use up $ 100 million this year. He hopes he can expand the facility to $ 500 million.
“The next steps are scaling and growth,” Lobo added. “We will almost triple our operations in the next few days. Our goal is to reach 5,000 customers, which will bring us to $ 100 million in sales. “
Drawing: Li-Anne Dias
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