AI Start-Up Basis Raises $34m For Accountancy Agent

Artificial intelligence start-up Basis said it has raised $34 million (£27m) in a Series A funding round for its AI-powered automation agent for accountants, in the latest example of venture funding pouring into emerging AI firms.

Khosla Ventures led the round, with participation from AI-focused fund NFDG, run by Silicon Valley veterans Nat Friedman, Daniel Gross, Larry Summers, Adam D’Angelo and Jeff Dean.

Basis, headquartered in New York City, is building automated agents specifically for accounting firms, which are able to perform tasks similar to those carried out by junior accountants.

The tools, which integrate with popular systems such as QuickBooks and Xero, aim to help accountancy firms address a shortage of accountants, as older professionals retire and the number of younger candidates sitting for the annual certified public accountant (CPA) exam steadily declines.

AI investment

Venture capitalists have focused increasingly on the AI sector since OpenAI’s launch of ChatGPT in November 2022 galvanised the sector, even as wider venture investment continues to sag.

Third-quarter venture funding worldwide totalled $66.5bn, down 16 percent quarter-over-quarter and 15 percent year-on-year, with the decrease led by large, late-stage rounds, Crunchbase said in October.

Late-stage funding for the quarter totalled $34.7bn globally, flat quarter-on-quarter and down almost 25 percent year-on-year as there were fewer deals at or above $500m compared to the same period a year earlier.

At the same time AI start-ups secured $19bn, or 28 percent of the total, Crunchbase found.

That proportion did not include OpenAI’s massive $6.6bn funding round, which valued the start-up at an eye-watering $150bn, as the deal concluded a few days after the end of the quarter.

Earlier this month Elon Musk’s xAI said in a filing it had raised $6bn from unidentified investors amidst expansion plans for the Colossus supercomputer at its Memphis, Tennessee facility.

Venture funding

This week Databricks, one of the most valuable start-ups, said it had concluded a $10bn funding round valuing it at $62bn, up from $43bn last year.

The start-up’s co-founder and chief executive Ali Ghodsi said the round was “substantially oversubscribed”.

Founded in 2013, Databricks pioneered the concept of a data warehouse that also acts as a data lake, allowing organisations to manage and use both structured and unstructured data for business analytics as well as AI workloads.

Its software is available on the cloud platforms of Amazon, Google and Microsoft, who are also competitors.