Today, local governments around the world collect billions of dollars in sales tax on software and digital products each year. But believe it or not, it was only about five years ago that legislators started applying sales tax to goods sold digitally: first, and famously, with remote e-commerce sellers.
With governments worldwide increasingly mandating and enforcing tax collection on all kinds of digital products including software, streaming services, video games, and now AI, more companies are faced with a real and unavoidable challenge.
Software companies are global from day one. Monitoring where your customers are, tracking different tax laws and rate changes, and reporting to governments is complex and burdensome. It’s what led my co-founder Kannan and I to start Anrok in 2020.
Today, we’re announcing our $30 million Series B funding round, led by Khosla Ventures with participation from Sequoia Capital, Index Ventures, and others including Karen Peacock, former CEO of Intercom, David Faugno, former CFO of Qualtrics and current President of 1Password, and Alex Estevez, former CFO of Atlassian.
“Anrok is an essential part of the financial stack of the world’s best SaaS and AI companies. We’re thrilled to support Anrok’s mission of simplifying and automating sales tax compliance for software companies and digital services.”
—Ethan Choi, Partner at Khosla Ventures
Anrok managed sales tax compliance for over $7 billion of revenue last year on behalf of our customers. We’re proud that innovative tech companies like Notion, Vanta, and Anthropic rely on Anrok to manage compliance worldwide and protect their bottom line.
Over the past year, we’ve expanded the platform by adding a reconciliation tool, advanced exemption certificate management, and support for VAT and GST compliance in every country that taxes remote sellers of software or digital products.
“As a fast-growing software company, Gem’s customers are spread across the globe. We thought getting to compliance would be a long and expensive journey, but with Anrok, the path was simple. Anrok helps us manage risk more effectively, and avoid surprise hits to our bottom line."
—Temi Vasco, Controller at Gem
With this new funding, we’ll grow our team and continue to invest in building the best product experience for the modern-day finance leader.
Thank you to our customers and to the Anrok team for making us the leading sales tax and VAT platform for software companies. I’m so grateful to be on this journey with you.
And if you’re interested in what we’re doing, come join us for this next phase of expansion—we’re hiring.
