Austin-based startup Nutiliti was founded in 2020 to help homeowners and businesses streamline utility management.
As the team ramped up, co-founder and CTO Bowden Kelly began building the technical infrastructure for customer billing. Kelly had implemented checkout flows before, but he quickly realized that optimizing SaaS billing processes for compliance has become more technically complex.
“I hadn't done it with all the new nexus laws in place,” says Kelly, referring to the changes in tax codes across the US since 2018’s Wayfair Supreme Court decision.
The nature of Nutiliti’s business adds to the complexity. “We have hundreds of thousands of bills per month that we process all over the United States,” Kelly says. “At that scale, we knew we needed an automated solution, and that we couldn’t solve the problem on our own.”
Using Avalara strained Nutiliti’s time, money, and reputation
After an initial search, Kelly and his team decided to try Avalara, a legacy sales tax tool. But after going through the process of procurement and implementation, they found that the tool failed to meet their most basic functional requirements.
“It just didn’t work as advertised,” Kelly says. “After four months of being on support calls with them, it still didn’t work. It was very frustrating.”
The issues they encountered with Avalara surprised Kelly. He’d anticipated potential roadblocks in the details of managing compliance across states, but thought the core tax calculation technology should work as expected.
“All we really need is for someone to do the math: Here’s an address, here’s an amount,” says Kelly. “But their system calculated and paid the wrong taxes to multiple states.”
These mistakes cost Nutiliti time and money—and put their customer relationships at risk.
“We had to hire a separate accountant to clean up the mistakes, and refund all the customers who’d been charged in error,” Kelly says.
All told, Nutiliti burned through an unnecessary $42,000 because of issues with Avalara.