Employer.com, an emerging leader in the dynamic fintech space has revealed that it has acquired San Jose-based startup MainStreet.com. Founded in 2019, MainStreet hit the ground running and quickly established a niche. It works wonders for startups to spot R&D tax credits, having great success in its initial years. The acquisition is in keeping with Employer.com’s long term strategy of automating business back office solutions.
MainStreet achieved significant milestones since its inception. By year two, the professional services firm was already over the $1 million annual recurring revenue (ARR) mark. This success resulted in an average savings of $51,000 per client. By 2021, MainStreet’s revenue jumped over $15 million, justifying its rising power in the fintech scene. In 2023, that same startup had a remarkable purported peak valuation at $500 million. It attracted about $75 million in venture capital from the likes of SignalFire, Tusk Ventures, Shrug, Moxxie Ventures, Weekend Fund, Gradient Ventures, Sound and SV Angels.
Though it had achieved much success in its short tenure, 2022 proved to be a challenging year for MainStreet. The market in all fairness took a beating, causing the company’s valuation to drop to $200 million post-money following a down round. On top of that, it axed roughly 30% of its staff amid what it called “a truly terrible market.”
With the acquisition finalized, MainStreet’s 15-person team will join Employer.com, which employs around 500 individuals across its portfolio of companies. This acquisition is a watershed opportunity for Employer.com. Beyond these new features, the organization is looking to better integrate and centralize its platform offerings and increase its business back office services.
Jesse Tinsley, an Employer.com representative, confirmed the acquisition, citing a strong strategic fit between the two companies. He expressed that the merger aims to “simplify business back office solutions into one powerhouse platform.”
The connection between Employer.com and MainStreet was made possible by one of MainStreet’s investors, who connected the two companies. This latest acquisition comes on the heels of another failed attempt by Employer.com to purchase Level, another upstart fintech. On top of that, Employer.com recently purchased Bench, a VC-backed accounting startup, in a fire sale after Bench, for reasons undisclosed, folded its tent.
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