Collective Raises $100M to Automate Taxes and Payroll for Solo Businesses With AI

Collective, a US-based financial technology startup helping independent entrepreneurs manage their businesses, has raised $100 million in new funding to expand its AI-powered financial platform.

The funding comprises a $40 million Series B and an additional $60 million investment from General Catalyst's Customer Value Fund (CVF). General Catalyst, QED Investors and Gradient Ventures led the Series B, with participation from Intuit Ventures, FT Partners and SemperVirens.

The additional $60 million comes through General Catalyst's Customer Value Fund, a separate investment structure designed to support customer acquisition. The company plans to use the capital to accelerate product development in banking and insurance.

Founded by Hooman Radfar, Ugur Kaner and Bugra Akcay, Collective provides business formation, accounting, invoicing, payroll, tax management, business insurance and health insurance through a single membership.

Building a financial platform for solo entrepreneurs

Collective is targeting independent business owners and solo entrepreneurs who need access to financial and administrative services but may not have the resources to maintain separate teams or hire multiple service providers.

The platform brings several business operations together, including:

• Business formation and setup

• Accounting and bookkeeping

• Invoicing and payroll

• Tax preparation and management

• Business insurance

• Health insurance

The company's approach is built around simplifying financial management for what it describes as a "Business-of-One".

CEO and co-founder Hooman Radfar says advances in AI are making it increasingly possible for individuals to build profitable businesses without needing the infrastructure traditionally associated with larger companies.

According to Collective, the US had nearly 30 million nonemployer businesses generating $1.7 trillion in annual receipts in 2022. The company says the number of these businesses has since grown beyond 30 million.

How the $100 million funding is structured

The latest announcement includes two distinct components.

The first is a $40 million Series B led by General Catalyst, QED Investors and Gradient Ventures. Intuit Ventures, FT Partners and SemperVirens also participated.

The second is a $60 million investment from General Catalyst's Customer Value Fund.

Unlike a conventional equity investment, the Customer Value Fund is designed to finance customer acquisition and growth-related spending. General Catalyst covers certain sales and marketing expenses and receives returns from the revenue generated through those customers.

The structure has previously been used to support companies including Otter.ai, Relay and Finom.

Collective has not disclosed the specific commercial terms of its own $60 million arrangement.

General Catalyst's Pranav Singhvi said the fund focuses on businesses with strong unit economics and large market opportunities. He highlighted solo businesses as an important segment that could expand further as AI makes it easier for individuals to operate businesses.

From AddThis to Collective

Hooman Radfar's entrepreneurial journey began before Collective.

While studying at Carnegie Mellon, Radfar co-founded Clearspring Technologies with classmate Austin Fath. The company later became AddThis, which Oracle acquired in January 2016 for approximately $200 million.

Radfar subsequently became a founding partner at venture firm Expa, where he met Ugur Kaner and recruited Bugra Akcay.

When Collective launched in September 2020, Kaner joined as Chief Product Officer and Akcay as Chief Technology Officer.

The company initially raised an $8.65 million seed round led by General Catalyst and QED Investors. It followed this with a $20 million Series A in May 2021, also led by the two investors.

In July 2023, Collective raised another $50 million in a round led by Gradient Ventures, alongside General Catalyst, QED Investors, Innovius Capital, The General Partnership, Expa and Better Tomorrow Ventures.

Its wider investor network also includes Sound Ventures and individual investors such as Nikesh Arora, Ashton Kutcher, Elad Gil, Dylan Field, Garrett Camp, Gokul Rajaram and Aaron Levie.

Expanding into banking and insurance

Collective has been expanding beyond its original accounting and tax services to offer a broader financial platform.

In April 2026, the company acquired AI accounting startup Open Ledger. In July 2026, it launched its Insurance Centre, partnering with Coverdash for business insurance and Solo Health for major medical insurance.

The latest funding will help accelerate further product development in banking and insurance, two areas that could extend Collective's relationship with its existing members.

The company says its platform is growing 127% year over year and has helped members save $350 million in taxes. It also reports that some of its highest-earning members have saved as much as $40,000 annually.

Collective further claims that its AI handles half of its customer support tickets while maintaining a 4.5-star customer satisfaction rating.

These figures are company-reported and have not been independently verified in the source.

Competition in AI-powered business finance

Collective operates in a competitive market that includes financial platforms, accounting providers and AI-powered business management tools.

Lettuce Financial is one of its direct competitors and raised $28 million in November 2025 in a round led by Zeev Ventures.

The broader accounting technology market is also attracting significant investment. Basis raised $100 million at a $1.15 billion valuation to build AI agents for accounting firms, while Accrual secured $75 million at launch, including a $65 million investment from General Catalyst. Rillet, which develops accounting software for finance teams, reached unicorn status following a $100 million Series C in August 2026.

However, these companies target different parts of the accounting market. Collective focuses on solo entrepreneurs and independent businesses, while several competitors concentrate on accounting firms or finance teams.

The shutdown of Bench in December 2024 also highlighted the importance of continuity and customer trust in financial services. Bench had raised $113 million and served more than 35,000 US customers before its sudden closure left businesses without access to their records.

The next challenge: retaining customers

For Collective, expanding its financial services offering is only part of the challenge. Its long-term opportunity will depend on whether it can retain customers and become an essential part of their business operations.

The structure of General Catalyst's Customer Value Fund investment makes customer acquisition and the revenue generated from those customers particularly relevant to the company's growth strategy.

As Collective expands into banking and insurance, it will need to demonstrate that its integrated platform can deliver lasting value to solo entrepreneurs.

The $100 million funding gives the company additional resources to pursue that ambition, while placing greater importance on customer retention, product adoption and the economics of serving independent businesses at scale.