Tax Fintech AnchorZero has announced an $8 million seed round led by Bain Capital Crypto and Spark Capital.
Other investors include Ethereal Ventures, Mischief Capital, Pascal Capital, and Robot Ventures. Angel investor Sarah Meyohas also participated in the round.
AnchorZero is a firm that helps individuals leverage Roth IRAs (retirement accounts) to boost tax savings. The firm aims to simplify the process of transferring early-stage equity into these IRAs, enabling investors to increase tax savings while improving gains.
IRAs have long been used by hedge funds and the very wealthy to shelter investments from taxes. As these assets grow tax-free, taxes may be deferred until any gains are removed from the account. Private securities are a booming sector of finance, especially due to the excessive regulation piled upon public firms by regulators and policymakers. AnchorZero seeks to help more individuals benefit from this strategy.
AnchorZero reports that current customers include founders backed by leading investors such as First Round Capital, General Catalyst, HF0, Lightspeed Venture Partners, and Y Combinator.
To streamline the process, AnchorZero has created its own IRA custodian making Roth investing fast and easy. AnchorZero allows founders to include their shares, angel investments, or exotic assets in their Roth IRAs for significant tax savings and potential growth.
Sunil Abraham, co-founder and CEO of AnchorZero said they are committed to making the strategy available to everyone. If they are successful “every student working out of their garage on a promising new venture will have access to the same tax products as that of a serial entrepreneur.”
Santo Politi, co-founder and General Partner at Spark Capital, said the team has built the first killer app in the category, allowing all founders to use Roth IRAs to purchase their founder shares and see their equity value grow tax-free.
“It is one tax management tool that any founder thinking of starting a company should actively consider.”