Tech-native accounting startup Benford has raised €5m (£4.2m) in pre-seed funding to build a vertically integrated statutory financial audit firm.
Venture capital firm Firstminute Capital led the round, supported by Global Founders Capital, Sondo and angel investors from Pennylane, Qonto, HSO and Amesto.
The 20-person firm holds a local audit licence in Norway, where its proprietary engine AuditOS operates live client engagements. The technology integrates directly with client operational software, subledgers and bank accounts to automate routine data collection and initial test work.
Unlike software vendors that sell tools to existing accountancies, Benford operates as a regulated practice. Systems perform the underlying data gathering, while qualified human auditors retain responsibility for scoping engagements, assessing exceptions and signing statutory opinions.
Benford said it planned to use the funding to hire engineers and auditors in London and Oslo and test the economics of delivering audits. It aims to prove its operating model before seeking regulatory approval in Sweden and other European countries.
Market interest builds as mid-tier businesses face rising audit fees amid a contraction of coverage by major accountancy firms. However, the firm must demonstrate that tech-driven efficiency gains offset the high overheads and regulatory liabilities of running an end-to-end audit practice.
Thibault Mallion, co-founder and co-CEO of Benford, said: “Audit is one of the few services where the customer experience has got worse every year while the bill has gone up. We are not changing what an audit is. We are changing how it is delivered.”
Michael Stothard, partner at Firstminute Capital, added: “For 20 years, innovation in audit has meant selling tools to auditors and most audits are still done the old way. Audit is a huge, structurally overlooked market that nobody has tried to rebuild from first principles.”
