As Novac/Jutarnji/Bernard Ivezic writes, the Croatian-Irish startup Fonoa, which offers automated tax calculation services on a global level and has Spotify, Remote.com, Uber and Zoom as clients, has received a 60 million euro investment. This is one of the ten largest investments in a startup by Croatian founders so far. The success is all the greater, because this is Fonoa’s second investment round in just six months. In the first, the company collected an impressive 20.5 million dollars.
The investment in the Croatian-Irish startup Fonoa has been led by Coatue, a VC fund started by American billionaire Philippe Laffont, who is among the first investors in TikTok’s parent company Bytedance, followed by Snapchat and Spotify. He was joined by the largest European B2B institutional investor Dawn Capital and one of the most successful European VCs, Index Ventures, as well as OMERS Ventures, FJ Labs and Moving Capital.
The Croatian-Irish startup Fonoa was otherwise the first in the entire world to develop a cloud platform for the automation of tax calculations on a global level. This Croatian-Irish startup was started by the former leaders of Uber in Croatia – Davor Tremac, Filip Sturman and Ivan Ivankovic. Fonoa’s platform allows companies to instantly, by connecting to their cloud platform, gain insight into the exact calculation of taxes in a certain country, and all this is done in real time.
Because of these possibilities, Fonoa promises its users not only speed, but also savings and an increase in the level of compliance with tax rules in a particular country.
Here in Croatia, for example, due to frequent changes in tax rules, as well as very complex tax legislation and accompanying regulations, it is often difficult for companies to enter the market. The Croatian market is small, and it is necessary to invest a lot in following these often cumbersome and frankly ridiculous regulations, so entering the market would not be profitable for some companies and thus would limit their market potential. In such cases, which are sadly commonplace, Fonoa becomes a useful tool.
Davor Tremac, the CEO and co-founder of Fonoa, says that they were helped by the fact that online shopping is booming and has been since the pandemic, so many of those who sell online are looking for the most efficient way to expand their businesses globally.
”Last year, we recorded a sevenfold increase in income. Since taxes are part of almost all online payment transactions, more and more companies are ready to switch to Fonoa’s platform, and the value of online payment transactions is expected to reach 8.5 trillion dollars in 2022,” says Tremac, explaining that with the development of their business, they noticed that a large number of companies wanting to reduce their operating costs and increase their levels of efficiency in the field of indirect tax management.
At the same time, they noticed that countries around the world were passing new regulations related to VAT, which leads to an increased demand for the tax compliance of companies. He emphasises that Fonoa provides the only tax software solution designed for use in the digital age.
”We make sure that companies pay the correct amount of taxes, that they’re paid to the right place and at the right time, and they can devote themselves to their business. We’re extremely glad that Coatue and other investors have supported our vision and are aware of the enormous opportunities that await us this year and in the coming years,” says Tremac.
Lucas Swisher, a partner at Coatue Fund, says that regulatory compliance is essential for companies to expand internationally, and tax management, processing and filing are extremely complex processes.
”When we met Davor, Filip, Ivan and the rest of their team, we were taken aback by the simplicity and efficiency of Fonoa’s platform, which turns an extremely complex process into something very simple and easily feasible. All of us at Coatue are excited to support Fonoa in scaling the platform and meeting the growing demand for solutions that enable tax compliance,” says Swisher.
Hannah Seal, a partner at Index Ventures, says managing taxes is navigating the bureaucratic maze of a country and represents a real nightmare for anyone trying to build a business with customers around the world.
”The Croatian-Irish startup Fonoa makes it all very simple. Companies are aligned with existing regulations and don’t have to deal with increasingly complex international taxes. This platform is an obvious choice for any digital company that operates outside the borders of its country,” says Seal.
”We’re really glad to be able to support the top team which make up Fonoa. I’m looking forward to working with Davor, Filip and Ivan to further attract outstanding talent and deliver technology to companies around the world,” says Mutafchieva. Tremac says that in the next year to a year and a half, Fonoa plans to present some new products in its field of activities.
”In order to achieve this, over the last twelve months, the company has quintupled the number of employees to 140 people of 35 different nationalities in 20 countries around the world and this year it intends to close things with even more employees,” concludes Tremac.
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