Canada’s Top Bookkeeping Platform Bench Calls It Quits

“Success is not final; failure is not fatal: It is the courage to continue that count.” While Winston Churchill might have been onto something, the abrupt closure of Vancouver-based Bench Accounting left more questions than answers for eCommerce brands, small businesses, and over 600 employees. 

But just days after the shocking shutdown, Employer.com announced it is acquiring Bench, offering a lifeline to its customers scrambling to prepare for the 2025 tax season. The acquisition by Employer.com, reported by TechCrunch, has brought some relief after Bench stunned the financial world by ceasing operations on December 27, 2024. Let’s dig into what happened, why it happened, and what this acquisition means for clients and professionals.

The Shocking Shutdown

Bench Accounting, once hailed as North America’s largest small-business bookkeeping service, stunned the financial world by ceasing operations on December 27, 2024. The timing, just days before year-end, couldn’t have been worse for its clients scrambling to close their books and prep for tax season.

Founded in 2012 as 10Sheet Inc. before rebranding as Bench in 2013, the company serviced over 12,000 clients, raised $113 million in funding, and boasted integrations with platforms like Shopify, Stripe, and PayPal. But despite its success on the surface, cracks were forming underneath.

Why Did Bench Close?

The reasons behind Bench’s closure are complex, with a mix of financial missteps, leadership changes, and strategic decisions contributing to its downfall. Speculation suggests Bench may have breached debt covenants (such as DSCR/gross margin/EBITDA margin requirements), requiring immediate loan repayment. Without sufficient cash reserves or profitability, insolvency became inevitable.

Former CEO Ian Crosby, ousted in 2021, publicly criticized the board’s decision to replace him, claiming their strategy would “destroy the company.” Shopify COO Kaz Nejatian echoed this sentiment, blaming “bad investors” for the company’s demise. Closing before year-end may have been a calculated move to minimize obligations and reduce client disruption before tax deadlines. While practical for Bench, the timing added stress for clients during an already hectic period.

Challenges for Bench Clients

Bench’s clients now face a race against the clock to ensure continuity of their financial operations. Here’s what they need to know:

• Data Retrieval: Clients can download their financial records, including year-end reports, receipts, and bank statements, until March 7, 2025, 5:00 PM ET. Bench has pledged to share detailed instructions by December 30, 2024.
• File a Tax Extension: Bench recommends clients file for tax extensions to gain additional time for finding new bookkeepers. This step is critical for businesses relying on Bench’s records for compliance.
• Transition to Alternatives: Rival platforms like Finaloop, Acuity, and Better Bookkeeping have stepped in, offering migration tools, discounts, and specialized services. For Shopify and other eCommerce businesses, choosing a solution with strong integrations and real-time reporting is crucial to avoid disruptions.

Impact on Shopify and eCommerce Brands

The sudden collapse of Bench Accounting highlights vulnerabilities in venture-backed service providers. Bench’s integrations with Shopify, Stripe, and PayPal made it a go-to platform for eCommerce businesses. With its sudden closure, brands are left scrambling to find alternatives that can handle the complexities of online sales, including revenue reconciliation, expense tracking, and sales tax compliance.

Failure to transition quickly could lead to delayed filings, compliance issues, and financial mismanagement, particularly for businesses operating on tight margins. This event also underscores the importance of founder-led vision in startups. Ian Crosby’s ousting and the subsequent fallout have reignited debates over whether replacing founders with professional management is a sound strategy.

An Abrupt Goodbye

The closure left over 600 employees without jobs, many of whom learned about the shutdown through internal memos. As of now, there is no clarity on whether severance packages will be provided. The timing just after the holidays has amplified the emotional toll on employees. For Canada’s tech and financial sectors, this event raises questions about worker protections and government support in the face of abrupt closures. While B.C.’s Minister of Jobs expressed sympathy, no direct assistance has been offered to affected workers.

Lessons for Clients and Businesses

The Bench Accounting shutdown is a wake-up call for businesses relying on third-party financial platforms. Here’s how you can protect yourself:

• Secure Data Immediately: Download and archive financial records well before deadlines to avoid losing access.
• Evaluate Alternatives Thoroughly: Look for platforms offering seamless migration, eCommerce integrations, and strong customer support. Ask tough questions about their financial stability.
• Build Redundancy into Your Operations: Consider maintaining offline backups or working with multiple vendors to safeguard against unexpected disruptions.
• Act Quickly: Filing a tax extension is not just a suggestion—it’s a necessity if your books are incomplete or your data is inaccessible.

The End of Bench

While the closure of Bench Accounting is undeniably disruptive, it also presents an opportunity for clients to reassess their financial systems and find better-suited solutions. The lesson? In the fast-paced world of e-commerce and finance, adaptability isn’t just an advantage, it’s survival. So, grab your popcorn and stay tuned. The Bench fallout is far from over, and the accounting world is already buzzing with the race to fill its shoes. But for now, the priority is clear: act swiftly, plan wisely, and keep your financial operations in check.  Stay informed and inspired—subscribe to our newsletter for fresh insights and updates delivered straight to your inbox!