US equity firm Left Lane Capital has led a $16 million funding round for online accounting service Hnry to scale in both New Zealand and overseas markets.
Hnry co-founder, James Fuller said the business had become “one of NZ's largest accountancies” and revenue was up 500% since June 2020.
“Completing the raise is a great testament to the hard work of the Hnry team, and provides us with a fantastic platform to help more and more Kiwis get the opportunity to earn income independently without excessive stress, hassle or cost,” he said.
The Wellington-based company, founded in 2017, processes and pays self-employed people’s taxes in real-time. Hnry customers are set up with a Hnry bank account into which they pay all their earnings.
The firm’s automated systems then calculate exactly how much tax customers should be deducting and send it straight to IRD. Hnry then pays customers the remaining balance, akin to salary after tax. It takes a 1% plus GST fee, with no additional hidden charges.
The capital raise – which values the startup at more than $100m – was led by Brooklyn-based investor Left Lane Capital and included existing investors EVP, Icehouse Ventures and Angel HQ.
Fuller said he had been introduced to Left Lane about 18-months ago by EVP which had worked with them on some other deals.
“We've been keeping in touch and updating them on growth and then, towards the end of last year, we all thought it was the perfect time to raise some capital,” he said.
Left Lane invests in internet and consumer technology companies and has previously backed digital learning company GoStudent, art investment platform Masterworks, and automated investment platform M1 Finance.
Hnry is the venture firm’s first ever investment in the Australasian market, although it has invested in Europe, Africa and Brazil.
Left Lane was attracted to Hnry’s rapid growth rate, high levels of customer satisfaction and future growth potential, Fuller said.
Fuller said he has a shortlist of seven or eight countries he wants to expand the service to, but the current focus is on Australia and New Zealand.
“We've already got a few countries on the shortlist that we're looking at and assessing at the moment, but there's so much growth potential in those two markets, particularly,” he said.
Having Left Lane, and its managing partner Vinny Pujji, onboard will help the company going forward and the new capital will see their team double to 80 people.
Pujji said he wanted to see Hnry evolve beyond being an accounting platform and also offer payments, insurance, and more.
“When you go off on your own – whether as a marketer, yoga instructor or house painter – you don’t expect you’ll also have to become a full-time accountant,” he said.
Hnry said approximately 15% of New Zealanders earn some or all their income independently, contributing an estimated $30 billion in earnings to the economy.