Madrid’s TaxDown on April 22nd announced a €4 million investment from Bonsai Partners to help the company accelerate its operations in Mexico as well as strengthen its use of AI.
Also based in Madrid, Bonsai Partners is a VC fund with a track record of supporting some of the most successful startups in the Spanish tech ecosystem such as Idealista, Wallapop, Glovo, among others.
Since its launch in 2019 by founders Alvaro Falcones Muñoz, Enrique García Moreno, and Joaquin Fernandez, TaxDown has helped Spaniards file their tax returns digitally and efficiently.
Its model combines proprietary technology, artificial intelligence (AI) and personalised attention from experts.
According to the company, it is already the platform that processes more income tax returns in Spain than any other private tool or traditional consultancy. Its success at home led the company to expand into Latin America in 2022 with its launch in Mexico. TaxDown has managed to begin to consolidate itself as a useful tool for millions of Mexican taxpayers, democratising access to fairer taxation and facilitating the recovery of more than 680 million pesos.
The company was recently named the second fastest growing scale-up in Spain, according to El Referente, after reaching a turnover of more than 10 million euros, which shows its potential as an innovative solution that can lead the future of taxation.
In a press release shared with Novobrief, TaxDown said the investment will allow the company to boost its artificial intelligence strategy, both in Spain and Mexico, and consolidate a growth model based on operational efficiency, proprietary technology, and a solid financial structure without the need to raise large amounts of capital.
“We do not believe in mega-rounds as a synonym for success. Our model demonstrates that you can operate efficiently, scale with AI, and achieve profitability without having to raise hundreds of millions,” said Enrique Garcia, CEO and co-founder of TaxDown.
A push to develop new AI tools
AI not only has the potential to transform the way taxes are filed, but also the way companies are built.
In this context, the company said it will allocate the new funds to bolster the AI team and accelerate the development of functionality that improves people’s lives: from further automating the tax process to personalising the service with a virtual advisor that helps TaxDown’s tax experts, multiplying their capacity and reducing errors.
This plan complements the platform’s current strategy, which already uses AI as the heart of the TaxDown model. Its tax engine has simulated more than 2 million personal income tax returns. As well as maximising savings, AI can detect errors, ensure compliance, and speed up response times.
The company also says that tax advisors working with technology support from TaxDown can be up to 200 times more efficient in resolving queries or reviewing returns because AI helps with repetitive tasks such as filtering documents, extracting relevant data, drafting responses, automating communications, and updating the team with daily tax updates.
In its communique, TaxDown also made clear that its other investors remain committed to the project, including Base10 (Silicon Valley), JME Ventures, and 4Founders.
In Mexico, the company faces competition from digital tax filing companies like Simplo, Simmple, and others.
