Kintsugi Raises $18 Million to Automate Sales Tax Compliance with AI

Kintsugi, a Silicon Valley-based startup founded in 2023, is revolutionizing sales tax compliance by leveraging artificial intelligence to automate tax calculations and filings. The company recently secured $18 million in funding led by Vertex, a global leader in indirect tax technology solutions, to expand its AI-enabled platform targeted at small and medium-sized businesses (SMBs).

The surge in e-commerce and cross-border trade, combined with increasingly complex tax regulations worldwide, has created a strong demand for automated tax compliance solutions. Kintsugi’s software integrates seamlessly with popular revenue platforms such as Shopify, Stripe, Chargebee, QuickBooks, and custom APIs, providing businesses with a comprehensive 360-degree view of their revenue streams. This integration enables instant tax calculations and streamlines the filing process.

Kintsugi’s CEO, Pujun Bhatnagar, envisions the company as a transformative force in tax compliance, similar to how Uber and Stripe disrupted their respective industries. The startup offers a user-friendly solution that allows businesses to calculate their sales tax liability for free and file taxes efficiently, reducing dependency on costly CPAs. With just a few clicks, users can install the app and manage tax filings in under three minutes monthly.

The startup has demonstrated impressive growth, generating $3 million in annual revenue last year and targeting $10 million by 2025. It maintains a remarkably low churn rate of 0.1% and serves a diverse customer base ranging from pre-revenue startups to companies with revenues up to $500 million. Kintsugi’s high profit margins exceeding 93% underscore its operational efficiency.

Vertex’s investment includes a $15 million minority stake and a commercial partnership based on revenue sharing, along with intellectual property sharing to accelerate AI integration. This collaboration complements Vertex’s focus on large enterprises by enabling Kintsugi to scale its specialized services for SMBs globally. Plans are underway to expand into South America, Africa, India, China, and other emerging markets.

Kintsugi’s approach addresses a critical need in the evolving tax landscape shaped by the 2018 Supreme Court ruling that empowered states to require online sellers to collect sales tax regardless of physical presence. By automating compliance across 171 countries, Kintsugi reduces complexity and cost for businesses navigating multi-jurisdictional tax obligations.

Implications for Businesses and the Tax Technology Industry

For businesses, especially SMBs, Kintsugi’s AI-driven platform offers a scalable, cost-effective solution to manage increasingly complex sales tax requirements. By integrating directly with revenue systems, companies gain real-time visibility into tax liabilities, reducing errors and compliance risks. This automation frees up resources and accelerates filing processes, enabling businesses to focus on growth and customer engagement.

From an industry perspective, Kintsugi’s success highlights the growing importance of AI in tax technology. The partnership with Vertex exemplifies how collaboration between innovative startups and established players can accelerate adoption of advanced compliance tools. As global e-commerce expands, demand for automated, AI-powered tax solutions will continue to rise, driving further innovation and market growth.

In summary, Kintsugi’s AI-enabled sales tax automation platform is poised to transform compliance for SMBs worldwide. With strong financial backing, strategic partnerships, and a clear vision, the startup is well-positioned to address the complexities of modern tax regulations and support businesses in navigating the evolving digital economy.