Materia, a new AI platform designed specifically for public accounting firms, has emerged from stealth mode with a substantial $6.3 million in funding. The startup, which aims to streamline tedious accounting tasks using artificial intelligence, announced its launch Thursday.
The funding round was led by Spark Capital, with additional investments from Haystack Ventures, Thomson Reuters Ventures, Exponential Founders Capital, and the Allen Institute for AI.
Founded by Kevin Merlini, CEO and Lucas Adams, CTO, both former Facebook employees, Materia was born out of Merlini’s firsthand experience with the mundane aspects of accounting during his time at KPMG. The idea was incubated at the Allen Institute for AI in late 2022, predating the launch of ChatGPT.
The startup enters the market at a critical time for the accounting industry. With 75% of CPAs set to retire in the next 15 years and new CPA numbers declining by 33%, the sector faces a significant workforce shortage. Materia aims to address this gap by automating time-consuming tasks, allowing accountants to focus on higher-value work.
“Accounting firms across the US are struggling with teams wasting valuable hours on low-value, tedious tasks that can be shifted to AI-powered workflows, freeing up accounting and auditing teams to focus on the highest-risk elements of an audit,” said Kevin Merlini, CEO and co-founder at Materia.
Materia’s platform consolidates firms’ internal knowledge into a secure Knowledge Hub and uses AI to assist with various accounting tasks. The company emphasizes quick implementation, SOC2 certification, and a focus on responsible AI use.
Early adopters have praised the platform’s effectiveness. Matt Sutorius, Partner at Clark Nuber, stated, “Materia has been an easy adoption for the audit practice. It’s AI that actually works and that our staff understands how to use intuitively.”
Natalie Sandman, a General Partner at Spark Capital, expressed enthusiasm about the investment: “We believe that Materia’s AI solution will transform the accounting industry, speeding up accounting professionals’ routine tasks and empowering them to provide higher quality services more efficiently to their clients.”
As Materia exits stealth mode, it’s already working with top national firms and positioning itself to become a major player in the AI-driven transformation of the accounting industry.
