An Ottawa company that aims to create salary transparency among chartered professional accountants has closed its first first round of funding and says it will use the money to reach big players in the industry.
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An Ottawa company that aims to create salary transparency among chartered professional accountants has closed its first first round of funding and says it will use the money to reach big players in the industry.
Big4Transparency, a website and online database, allows CPAs to anonymously submit data about their salaries and information about certifications, experience, education and location, as well as personal details such as gender and ethnicity, to provide greater pay transparency within the profession.
The company recently closed a seed round of financing, raising approximately US$100,000 in funding, according to founder Dominic Piscopo.
Hall CPA, which was one the company’s earliest customers, is the lead investor.
“Brandon Hall, the CEO, really liked the product very early on and, despite having no financial incentive whatsoever to do so, he was really promoting it as a really valuable retention tool and a good solution for firms who are struggling on the talent perspective,” said Piscopo.
The database, which has been used by 250,000 CPAs across North America, started as a side project for Piscopo in 2021 and he continued to treat it that way for several years. Earlier this year, he decided to pursue it full time, something the funding will help him achieve.
“I kind of intended to keep this going as a side project; I really like my job at (Ottawa-based) Rewind,” said Piscopo. “But I realized that there was a pretty good opportunity there and a customer of mine actually helped me recognize that.”
While the platform is widely used for free by CPAs looking for information to negotiate their own salaries, Piscopo said he’s been targeting accounting firms that can benefit from the data he’s accumulated.
It’s especially important now, he said, as the accounting industry grapples with an ongoing skill shortage.
“There are other providers in the market, but a lot of those are information exchanges, but that data is not generally very timely,” he said. “The accounting market in general, in both Canada and the U.S., has a huge shortage of accounting professionals. (A recent survey) found that almost all firms say the biggest obstacle they face is access to talent. This is a very large opportunity with firms really struggling to attract and retain talent.”
In addition to building out a team, the funding will be reinvested into the company to improve the product on multiple levels, including revamping its dashboard for subscribing firms, allowing them to view compensation data as well as analyses.
Piscopo said while many of his clients are small and medium-sized accounting firms, the big four companies – Deloitte, Ernst & Young, PwC and KPMG – have also shown interest. The funding will go toward ensuring the product can better suit the needs of larger enterprises.
“One of my early customers was actually a big four firm in Canada, which brought its own challenges because you’re going from a 10-, 50-, 100-employee company to 10,000-plus employees,” he said. “For them, they’re more interested in the raw data offering.
“There’s already been a pretty substantial amount of work done on refining what we’re offering to firms to make it a bit more professional, a bit more buttoned up,” he added. “When we started, I was literally just emailing firms a Google sheet with a bunch of manual analysis. Now it’s a little enterprise-friendly, but there’s a long way to go on that front.”
He added that the funding was procured during a period where the investment landscape faces challenges.
“There’s actually Ottawa folks who are in investing who have been outspoken about this,” he said. “The change to capital gains inclusion rates makes this form of investing a little bit less appealing. In general, startup investing in Canada was very favourable from a tax perspective and (the federal government has) made it less favourable. It did come up in conversations with investors.”
Whether his company decides to pursue another round of funding is still up in the air, but Piscopo said there’s been interest.
“There’s a kind of model of business that’s gaining a lot of traction by fundraising minimally and then trying to operate profitably,” he said. “A lot of companies have gotten burned by raising too much money too fast. I’m taking the opposite approach, raising money as needed to be able to pursue opportunities, but not really pursuing those sequential rounds of raising more and more and more.”
