Bench to be acquired after abruptly shutting down | Hacker News Reader

Bench to be acquired after abruptly shutting down

techcrunch.com

107 pointsNelkins80 comments

Seems like a last second deal. Doesn't inspire confidence. For context: https://news.ycombinator.com/item?id=42523061

And former CEO's post: https://x.com/ianwcrosby/status/1872724231999381790

It's very possible it has been a deal long time in the making.

When you're in an acquisition process, the acquirer will often prey on your weaknesses to get a better deal. If Employer.com had already been in talks prior to the shutdown, then they already knew the financial condition, they may have surprised Bench with a dramatic decrease in the purchase price at the 11th hour in an effort to get a better deal knowing Bench's only other alternative would be to shut down. Maybe Bench called their bluff, called off the deal and shut down. (The only rational reason to do that would be if they think they could successfully sue the acquirer or get the original deal back on the table)

Pure speculation, but typically acquisitions take many months to come together. Even a firesale acquisition doesn't happen in a week.

This might not even be worthy of being called a firesale acquisition. It might just be selling the customer contracts locked in with Capchase.

Lousy behavior all the way around. And with SMB accounting on the last days of the year.

Yup. Though also, the time of maximum leverage probably?

> It's very possible it has been a deal long time in the making.

No.

From the acquirer:

“It fits our product roadmap. It was super serendipitous…I saw that news. I was like, ‘This is perfect.’ It checks a lot of boxes for us. It was just a really good synergistic opportunity, so we went for it.”

https://multitudes.weisser.io/p/how-employercom-acquired-ben...

Now with a list of Board of Directors

https://x.com/amasad/status/1873018020895047744

The lust for a simple good guy vs bad guy narrative is insatiable.

People are spoiling for a fight.

You can’t fight against a vague idea. You can’t fight against something which you’re complicit in. You can’t fight against ‘the good guys’ without being a ‘bad guy’.

So eventually, either we stop spoiling for a fight…. Or someone gives us this kind of fight.

For Bench customers that want to look elsewhere, Pilot is doing free migrations from Bench to QBO, even if you don't want to use Pilot. (So you can even take advantage of it if you want to instead DIY or work with some local firm.)

https://pilot.com/bench-qbo-migration

(Disclaimer is that I'm one of Pilot's founders.)

Your free BOI filing (even if you don't want to use Pilot) is why I use Pilot.

BOI filing isn’t that hard? Takes 5 minutes to DIY each entity on the FINCEN portal.

Honestly, love to hear this :)

Would you trust Employer when their "About" page looks like this? https://www.employer.com/about

"Our Story There are many variations of passages of available, but the majority have suffered alteration in some form, by injected humour, or randomised words which don't look even..."

They've secured investments from Logoipsum, Logoipsum, Logoipsum and Logoipsum so they must be legit.

Ha!

Sounds like they are not afraid to use AI already, which will give them an unbeatable edge when the LLMs improve.

Source: YC investment thesis

Yeahhhh I wonder if this is a new shell company spun up to either take on the old one as a way to restructure financially and get rid of some debt (I have no idea how this would work) or to give them enough time to wind down. Or something else? Who knows but definitely weird.

Employer.com is a new "brand" from long-established Recruiter.com. My guess is that Recruiter.com planned to launch Employer.com in the near-term, and they saw the Bench.co shutdown as the perfect opportunity so they've sped up their plans and "launched" employer.com.

edit: after reading Recruiter.com's investor filings (as they're a public company) the acquisition of Bench is going to kill them. The founder has gone hog wild on acquisitions despite having barely enough income to support them. It's a tale as old as time: a medium successful company goes public and starts issuing shares to fund acquisitions at a rate far outpacing the business growth and suddenly, one day, the music stops and everything comes crashing down.

I am not doubting you, but where did you hear this abut recruiter.com?

there is a link on the page that links to "bountyjobs.com" -- which says on that page "a recruiter.com company"

The article of this post

The process you describe above is highly vulnerable as Ponzi scheme. The goal would be to raise total revenues, to paint a certain financial picture to meet targets for cashing out before the high debt load and interest payments sink the ship.

As soon as there is insufficient cashflow for several consecutive periods, the whole thing comes crashing down. This is a strategy for cashing out, rather than building a long term sustainable book of companies for steady, organic growth which has the cash to payout dividends and reward loyal investors.

> The process you describe above is highly vulnerable as Ponzi scheme. The goal would be to raise total revenues, to paint a certain financial picture to meet targets for cashing out before the high debt load and interest payments sink the ship.

You have just described almost every modern VC backed company….

As well as:

What’s the mission behind Strivo?

If you are going to use a passage of text, you need to be sure there isn't anything. There are many variations of passages of available, but the majority have suffered alteration in some form, by injected humour, or randomised words.

I searched the phrase "What's the mission behind Strivo?" because that felt like a rather specific question in the middle of a bunch of placeholder text. This template came up in the results, and it's a lol to see how little was changed from the template...including some of the photos

https://strivo.framer.website/about

According to the founder, he just bought the domain a month ago: https://x.com/JesseTinsley/status/1861243509006848065

Probably not finished but acquired Bench anyways.

Amazing how this company that barely existed 5 minutes ago is already trusted by Google, Chipotle, Robinhood, HubSpot, X, Chime and Anthropic per their landing page. I wonder if that's also news to those companies.

Someone visited the website from their IP ranges how much more trust do you want?

In the world of crazy valuation ~$450k for that domain seems pretty good deal.

Is that a form of lorem ipsum or ... what even is that?

looks like they "fixed" it by removing all content save for the title

Screenshot would have been nice ;)

An hour after the parent post, the about page https://www.employer.com/about now redirects to the home page https://www.employer.com/ — must have been an error that the webmaster has corrected.

They also left https://www.employer.com/terms showing the license for the template they bought.

"By accessing and placing an order with UXTheme, you confirm that you are in agreement with and bound by the terms and conditions contained in the Terms Of Use outlined below. "

Has anyone figured out how to download your data from Bench? In the original email they sent out that announced they were shutting down, they said data would be available to download from http://data.bench.co. But right now, this domain appears to be inactive. When I logged back in, they gave me the option to: give employer.com permission to access my data, or download my data. I selected the former option so that I could access the dashboard, but I'd still like to download my data in case it turns out I would like to migrate to a competing service.

I'm in this same boat. I started the onboarding with kick.com over the weekend. Yesterday clicked the "Opt Out Download Data" button and still haven't seen any data.

Former Bench user here - I selected to opt-out and download my financial data over an hour ago. I still haven't received it and am getting concerned. Has anyone actually received their data from Bench yet?

Hello, I was wondering if you ever got the email with the download link? Thanks so much.

Let's wait and see. This is a case study in how not to shut down a company. I, like many business owners, will have already started looking at alternatives. With an estimated 35,000 businesses you would have thought Bench would have some acquisition offers on the table before they chose to close.

It's possible that they explored all acquisition possibilities they could find without the world knowing about their situation, and that the only company or companies who could reach acceptable terms to acquire them didn't have the network links to find out that Bench was acquirable until the news broke that they were shutting down.

Obviously not an ideal situation, both parties (if an acquisition is indeed happening) would prefer to have been able to do it before Bench's announcement, but there's simply no way to let every single person & company in the world who might consider acquiring them know what's on the table without the information being public knowledge too.

NDR (Net Dollar Retention) in a business like this is the key metric for determining whether there's a business or customer base worth acquiring here. With Bench's rumored churn in recent years, their existing investors which includes top funds like Bain and reputable ones like Inovia (which is top Canada) would've had the opportunity to invest first. Clearly they didn't.

With a rumored 2024 revenue of $54.9m in 2024, and peak valuation at $230m+ (4x Rev which isn't unreasonable to pay even for a tech-enabled services business), churn would've been really bad for this deal to end up here.

I was commenting on how acquisitions happen, not asking to be spammed by an accounting company masquerading as a relevant comment.

I'd suggest deleting it and not continuing this strategy, as I suspect I'm not the only HN reader who will react to your comment by making a mental note that 'Digits' is a company with annoying marketing.

Hey that's good feedback. I'll leave the first part since I was also commenting on how acquisitions happen. Note though that the OP is an affected bench customer looking for a transition but I'll respect your part of this thread. Have a great rest of 2024.

As someone who was affected by this, I opted to go ahead and try and get my money's worth (although I have another service doing this in parallel). Also they were supposed to file an S Corp election for me, so hopefully I'll be able to find out the latest status of that. This whole thing is such a mess.

A bit of research yields this guy as this owner of employer.com: https://x.com/JesseTinsley

At the end of his bio:

> Acquiring companies DM me

did it immediately let you proceed to your existing data

Yes. I'm able to log into the platform. You need to navigate to https://app.bench.co. I actually don't remember if they provided that URL, or if I just typed it into my browser out of habit. It may work for everyone who was on the platform.

It's never that smooth.

In fact 2M requests arrived on December 23rd from Claude alone for a single site.

Average 25qps is definitely an issue, these are all long tail dynamic pages.

Curious what your robots.txt looked like, if you have a link?

have you found anyway to export this year's data? I've logged in but now I'm worried that somehow opts out of getting the export data

Same. The situation is clear as mud.

When was your S corp election supposed to be effective for? Are you registered with the state as a corp or an LLC? In the meantime, behave as if you ARE an S-corp (payroll, tax filings, etc.). That allows you to get late election relief if you find they messed up.

I created a subreddit in case any current/former Bench users would like to continue talking to one another and compare notes: https://www.reddit.com/r/BenchUsers

Thank you!

lol, well, the companies who have already started a migration away from Bench are probably not going to stop their migration. Ouch.

Especially when the Bench competitors offering those migrations have a deadline of the 31st to do 2024 books/taxes.

https://news.ycombinator.com/item?id=42523061 "bench accounting services shutting down". 3 days ago, 300 comments

(We changed the URL from https://www.bench.co/ to an article that gives more background.)

In addition to all the other weirdness about this, their email announcing this had a fascinating bug in it:

I received an email with subject "Bench is Back — Here’s What You Need to Know". The contents looked like a copy of the previous mail: "We regret to inform you that we will be shutting down Bench services. Effective immediately, [...]".

On a hunch, I checked the HTML version rather than the plain text. "<p>Bench has been acquired by Employer.com and we’re thrilled to share with you that as of today, December 30, 2024, we’re back in action.<br /><br /></p> [...]"

Somehow, they managed to send out an HTML mail that has the plain-text of a completely different mail. How does that even happen? What possible steps would lead to sending such a mail?

-----

For anyone curious about the complete contents of the mail sent to Bench customers (the HTML one they seem to have actually intended to send):

Dear Bench customer,

We wanted to get in touch with you to give you an update on Bench Accounting.

Bench has been acquired by Employer.com and we’re thrilled to share with you that as of today, December 30, 2024, we’re back in action.

What You Should Know

Is anything changing?

No, you will continue to work with the same great team, platform, and service. We’re preparing to wrap up your year-end financials and get you set for a smooth tax season in Q1 2025.

Who will be doing my books?

The same great Bench team will continue to be supporting you with your books using the Bench.co platform, ensuring that you have a seamless experience moving forward.

Next Steps

To continue working with the Bench team and platform, simply login to your account, and click “I Consent.”

This gives us the permission to continue supporting your account, and transfers your data ownership from Bench to Employer.com

If you do not wish to provide consent, you will have the option to opt out. Please note that once opted out, we cannot reverse the action nor can we provide any refunds.

We know the sudden shutdown of Bench disrupted things, and for that, we’re truly sorry. This acquisition is about turning things around and making sure your bookkeeping needs are met — better than ever. We look forward to working with you for a successful tax season ahead.

Thank you for your patience and understanding, and please reach out if you have any questions.

The Bench Team

What a comedy of errors. So they screw over their paying customers without any notice and now suddenly they are acquired ? I love capitalism but the way Bench handled this is a disaster and left so many customers unsure of what to do. Especially at year end when accounting becomes even more critical. Shameful.

There's not really an economic philosophy that can protect people from bad decisions. In the middle of year end accounting though, this was a train wreck.

There is a right way to do this and a wrong way and they picked the wrong way. The right way is to say "we will do 2024 and work with you to transition for 2025".

Where does the money come from to pay for that? As an employee, would you want to work for 6mo, for no promotions, bonuses, stock?

Seems like they could have had huge layoffs, to try to maintain, but maybe they thought the sale would go through before the shutdown, meaning no one gets laid off.

But the buyer waited until after the shutdown to grab it

From the fees the customers are paying for the bookwork.

If they were profitable, then they wouldn’t have shut down…

Presumably, their cost to serve was higher than what their customers were collectively paying.

There was barely enough money to pay for the last week of wages, would you expect employees to volunteer to achieve that?

I'm not defending what they did, but doing the work even one more week was not an option afaik. At best they could have wrapped up earlier?

A business should know approximately when it will run out of money. Ethically, they should have warned their customers that their financial situation was poor and thus they might close.

They should have done that months ago... Maybe they would have been acquired without all the drama...

Problem is, if they thought that there was any chance of making it, telling people “we might have to shut down soon” will ensure that they do shut down.

The vulture capitalists just bought a whole bunch of data.

In disrupting the staid, predictable world of accounting, one must move fast and break things.

I wish the trend of moving fast and breaking thing would go out of fashion already. I guess being kind and fixing things doesn't make any money so why would anyone want that /s

Recent and related:

Bench accounting services shutting down - https://news.ycombinator.com/item?id=42523061 - Dec 2024 (304 comments)

how long does it take for you to get the secure link that has your data from Bench when you opt out of Employer.com

> Your service will continue seamlessly with the platform you’ve always trusted.

Uh, I think that trust may be a bit compromised until they explain what the hell happened.

Now with your quote, I'm curious how many times they've changed this lander...

> Welcome Back [...] More information on how to continue your services will be available soon.

The new Bench site asks us to click a button saying we "consent to continue using Bench as part of employer.com." Has anyone clicked that? I'm hesitant, since it does not state clearly what I am "consenting" to.

[flagged]

Especially when the service the last couple years has been bad...

Reply on news.ycombinator.com