Billion Dollar Unicorn: Avalara Delivers A Strong IPO

Earlier last month, financial technology Billion Dollar Unicorn Avalara (NYSE: AVLR) went public. While it has been a very short run so far, the stock has done rather well. The company estimates its US addressable market alone at $8 billion. Avalara has just scratched the surface here and has a lot of potential. But first the numbers.

Avalara’s Offerings

Seattle, Washington-based Avalara was founded in 2004 by Jared Vogt, Rory Rawlings, and Scott McFarlane with a mission to help business of all sizes manage tax compliance easily and efficiently. It operates on the motto of “Tax compliance done right.” It delivers on this through its cloud-based solutions that help in simplifying and automating the processes of determining taxability, identifying applicable tax rates, determining and collecting taxes, preparing and filing returns, remitting taxes, maintaining tax records, and managing compliance documents. In 2017, its platform was processing more than 16 million tax determinations per day.

While automated tax filing is not new, Avalara’s offerings focus on automating the processes surrounding transaction tax calculation, compliance and filing. Avalara covers these transaction taxes including sales and use tax, excise tax, value-added tax (VAT), goods and services tax (GST), lodging taxes, and communication taxes. It has been built with the digital world in mind and it offers a multi-channel approach that helps businesses manage their online sales that can traverse multiple jurisdictions ranging from the local state tax laws in the US to international tax laws.

The Avalara Compliance Cloud integrates an advanced database of an up-to-date tax content with technology for executing on the taxation process. It has partnered with the invoice providers themselves as a go-to-market strategy. That has helped Avalara build more than 600 prebuilt integrations including those with Adobe’s Magento, Oracle, SAP Hybris, and Stripe. The integrations are useful in picking up the transactions conducted by the business and identifying the taxation rules that apply on those transactions.

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Sramana Mitra is the founder of One Million by One Million (1M/1M), a global virtual incubator that aims to help one million entrepreneurs ...

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