Picture this: it’s Monday morning. You sit down with your coffee, open your inbox, and instead of the usual flood of promotions and spam, you see the email. The one that makes your stomach drop faster than a roller coaster at tax season. Bench Accounting – the company you’ve trusted with your books – is shutting down. Effective immediately.

Cue the frantic Googling, the panicked phone calls, and a sudden desire to stress-eat whatever leftover holiday candy you can find.

For thousands of small business owners, this wasn’t just a hypothetical horror story – it was their reality. Bench Accounting, once hailed as the go-to for online bookkeeping, unexpectedly pulled the plug, leaving its clients scrambling to figure out what’s next.

The fallout? Chaos. Confusion. And a whole lot of questions.

In this post, we’re going to dig into what happened, why it happened, and (most importantly) how you can protect your business from finding itself in a similar accounting freefall. Whether you’re one of the many Bench clients left in the lurch or just curious about the broader lessons this shutdown teaches, stick around. This might just save you from a financial headache down the line.

Let’s be honest. Outsourcing your bookkeeping is like hiring a babysitter for your financials. You expect them to care for the books, make sure they’re fed, attended to, and not set the place on fire. When Bench burst onto the scene, it was like hiring Mary Poppins – tech-savvy, affordable, and magically efficient. But now, it feels more like the babysitter left the stove on and bolted.

So, how did we get here? And more importantly, what can we learn from this financial fumble?

First, let’s rewind and get to know the Bench story.

Who Was Bench Accounting?

Before the dramatic exit, Bench wasn’t just another bookkeeping service – it was the bookkeeping service for many small businesses. Founded in 2012, Bench promised to revolutionize how entrepreneurs handled their financials by blending cutting-edge software with human bookkeepers. Think of it as QuickBooks, but with a friendly team of experts doing the heavy lifting for you.

The Origin Story

Bench started out of Vancouver, Canada, as a small startup with big ambitions. The idea? Take the drudgery out of bookkeeping for small businesses that didn’t have the time, expertise, or (let’s be real) the patience to keep their financial records pristine. Over the years, Bench gained traction, thanks in part to slick marketing, intuitive software, and a subscription model that offered predictable pricing.

By 2020, Bench had served over 25,000 businesses, making it one of the largest bookkeeping services in North America. It was known for being particularly popular among freelancers, e-commerce store owners, and other small operators who wanted professional accounting without hiring a full-time bookkeeper.

What Made Bench Stand Out?

Bench wasn’t just about crunching numbers; it was about making accounting accessible. The platform paired each business with a dedicated bookkeeper who handled the month-to-month categorization of expenses, reconciliations, and tax-ready financials. All clients had to do was upload their bank statements and receipts – Bench took care of the rest.

For many entrepreneurs, Bench felt like a financial lifeline. It bridged the gap between DIY accounting software and hiring an expensive CPA firm. The sleek interface, human support, and relatively affordable pricing turned Bench into the darling of the small business world.

The Expansion and Success

As Bench grew, so did its service offerings. From tax support to catch-up bookkeeping for businesses that had fallen behind, Bench positioned itself as a one-stop shop for financial management. Major publications, including Forbes and Entrepreneur, featured the company as a rising star in the fintech space.

Bench raised significant funding over the years, securing tens of millions from investors eager to ride the wave of small business digitization. Its growth trajectory seemed unstoppable.

But as we know, not all that glitters is gold. Despite the success story, cracks were beginning to show beneath the surface.

The Sudden Shutdown – What Happened?

For many, the news of Bench’s closure came like a thunderstorm on a clear day—no obvious warning, just a sudden downpour of bad news. But was it really so sudden?

Early Warning Signs

Hindsight, as they say, is 20/20. Looking back, there were clues that Bench might have been heading for rocky waters. In late 2023, rumors of layoffs began to surface, with reports indicating that approximately 450 employees were let go.

Industry insiders hinted at financial strain, suggesting that scaling a business reliant on both software and human expertise can be a tricky balancing act—one that, for Bench, may have tipped too far in one direction.

Timeline of Events

• December 27, 2024: Bench Accounting abruptly ceased operations, announcing the immediate shutdown of its platform. Clients were informed via email and a notice on the company's website, leaving over 11,000 small business clients without access to their financial data.
• December 30, 2024: In a rapid turn of events, Bench announced its acquisition by Employer.com, an HR technology firm. The acquisition aimed to restore services for Bench's clients, with promises of seamless continuation under new ownership.
• March 7, 2025: Deadline for clients to download their financial data from the Bench platform, as access will be discontinued thereafter. To ensure you retain control over your financial records, it's crucial to log in and export all available data before the deadline. This includes your general ledger, attachments (receipts, etc.), chart of accounts, balance sheets, and profit & loss statements. After exporting your data, consider securing a new bookkeeping service or accounting platform to maintain your financial operations seamlessly. If you encounter any issues accessing your data or need assistance during this transition, it's advisable to contact Employer.com's support team promptly to avoid any disruptions to your business operations.

What Went Wrong?

Bench’s downfall appears to stem from a combination of factors:

• Overexpansion: Rapid growth stretched the company’s resources too thin, leading to operational inefficiencies and financial strain.
• Leadership Changes: The ousting of original founder Ian Crosby by venture capitalists led to strategic misalignments and internal conflicts, potentially contributing to the company's decline.
• Economic Pressures: Broader economic challenges and increased competition in the fintech space may have further strained Bench's business model.

While the exact reasons are still unfolding and no official cause has yet to be revealed, the reality is clear—thousands of small business owners are left scrambling to fill the gap Bench left behind.

The Fallout – What Does It All Mean?

The sudden shutdown sent shockwaves through the small business community, causing widespread disruption at a time when predictability and stability were desperately needed.

Immediate Impact

• Operational Delays – Small businesses relying heavily on Bench for day-to-day financial tasks faced immediate bottlenecks. Incomplete reconciliations, payroll delays, and tax season uncertainty created significant stress.
• Tax Season Rush – With year-end approaching, businesses had to quickly transition to new bookkeeping services or handle accounting in-house to avoid missing critical tax deadlines.
• Scrambling for Data – Clients were given a limited window to download financial records, adding time-sensitive pressure to already overwhelmed business owners.
• Resource Diversion – Many businesses had to pull key team members away from regular duties to focus on finding accounting solutions, causing productivity dips.

Industry-Wide Ripple Effects

• Increased Caution Among Small Businesses – The abrupt closure heightened awareness of the risks involved in relying solely on third-party platforms for essential business functions. Many small businesses are now reassessing their bookkeeping strategies, seeking more stable or diversified service providers to avoid similar disruptions in the future.
• Scrutiny of Fintech Startups – Investors and industry experts have placed greater scrutiny on fintech startups offering hybrid services (software + human expertise). The shutdown has sparked conversations about the scalability and long-term sustainability of such models.
• Opportunities for Competitors – Bench’s sudden departure left a gap in the market that competitors like Pilot, Xero, and QuickBooks quickly sought to fill. This reshuffling presented an opportunity for these companies to attract disillusioned Bench clients by offering seamless migration services or discounts.
• Regulatory Attention – The shutdown drew attention from regulatory bodies concerned about consumer protection in the fintech space. Discussions about the need for stronger oversight and contingency planning for accounting platforms are gaining traction.

Long-Term Impacts on Clients

• Rebuilding Trust – Small businesses that experienced disruption now face the challenge of rebuilding trust with new service providers. Many are taking a more hands-on approach to bookkeeping, adopting hybrid DIY approaches with increased internal oversight.
• Financial Loss and Recovery – Some clients reported financial setbacks due to missed deadlines, payroll mishaps, or tax filing errors. Although Employer.com’s acquisition aimed to mitigate further losses, the transition wasn’t seamless for everyone. Recovery from these setbacks has varied depending on the responsiveness of the new provider and the complexity of each business’s financial situation.
• Lessons in Contingency Planning – The experience has highlighted the importance of backup plans. Small businesses are now more inclined to regularly export financial data, maintain backup copies, and keep secondary accounting solutions on standby.

Why This Matters – The Bigger Picture

The Bench shutdown serves as a stark reminder of the vulnerabilities businesses face when they depend too heavily on external platforms for critical operations. While outsourcing can streamline processes and cut costs, the sudden collapse of a trusted service provider can leave businesses scrambling. This incident underscores the importance of diversification, resilience, and proactive planning.

Key Lessons for Business Owners

• Diversify Your Accounting Tools and Providers
  Relying solely on one platform is convenient, but it’s also risky. Consider using a combination of software tools and accounting services to ensure continuity in case one provider shuts down. For example, pairing automated accounting software like QuickBooks or Xero with a part-time bookkeeper can provide flexibility and stability.
• Maintain Regular Data Backups
  Bench’s shutdown forced clients to scramble to download financial data. To avoid this panic, make it a habit to back up your financial records monthly. Save copies of your general ledger, profit and loss statements, and other essential documents offline or in secure cloud storage. Having accessible backups ensures you can switch providers seamlessly if necessary.
• Vet and Reassess Vendors Regularly
  Don’t just evaluate vendors at the beginning of your relationship—keep an eye on them over time. Regularly assess the financial stability, reputation, and customer reviews of your service providers. Look for red flags like frequent leadership changes, layoffs, or declining service quality, which could indicate underlying issues.
• Develop Contingency Plans
  Create a plan for transitioning your financial management if a provider suddenly shuts down. This might involve identifying backup services in advance or ensuring that your internal team has the skills to manage bookkeeping temporarily. Being proactive can prevent disruptions during critical periods, such as tax season.

Industry Implications

• Greater Demand for Transparency and Accountability
  Fintech companies will face increased pressure from clients to disclose their financial health and contingency strategies. Business owners are now more likely to demand service-level agreements (SLAs) that outline how data will be handled during closures or transitions. This shift could lead to higher industry standards for transparency.
• Opportunities for Competitors and New Entrants
  The void left by Bench opens doors for smaller players and competitors to capture market share. Companies that can demonstrate reliability, offer seamless migration tools, or specialize in serving small businesses will likely thrive. Expect a wave of innovation as fintech firms attempt to differentiate themselves and win over former Bench clients.
• Hybrid Models Under the Microscope
  Bench’s reliance on a hybrid model (combining human bookkeepers with software) highlighted potential pitfalls. Moving forward, businesses may gravitate toward either fully automated solutions or personalized, CAS-focused (Client Accounting Services) approaches that emphasize long-term partnerships and adaptability.

How to Protect Your Business from Service Shutdowns

The abrupt collapse of Bench Accounting left many business owners scrambling, but it also serves as a valuable learning opportunity. While no one can predict when a service provider might shut down, you can take proactive steps to safeguard your business from similar disruptions. Here’s how to fortify your financial operations and minimize the impact of future shutdowns.

1.

Diversify Your Financial Ecosystem

Don’t rely on a single platform for all your accounting needs. Instead, build a diverse ecosystem that spreads responsibility across multiple tools and providers. For example:

• Primary Platform: Use software like QuickBooks or Xero for daily bookkeeping.
• Secondary Support: Hire a part-time bookkeeper or accountant who can step in if needed.
• Supplementary Tools: Incorporate expense management tools (Fyle or Ramp), invoicing platforms (Bill360), and payroll services (Gusto) to reduce reliance on one system.

A multi-platform approach ensures that if one part of your system fails, the rest continues to function smoothly.

2.

Keep Copies of Your Financial Data

Data is your most valuable asset. Make it a habit to download and securely store financial reports, transaction histories, and reconciliations regularly. This ensures you have access to vital information even if a platform suddenly goes offline.

• Monthly Exports: Download balance sheets, profit and loss statements, general ledgers and other essential records at the end of each month.
• Cloud and Local Backups: Store copies both in the cloud and on local drives to prevent data loss.
• Automated Solutions: Use backup services that sync financial data across platforms automatically.

3.

Maintain Internal Bookkeeping Competency

Even if you outsource bookkeeping, ensure someone on your team understands the basics. This prevents a total breakdown if your provider disappears. Encourage staff to take online accounting courses or workshops to stay informed.

• Cross-Training: Rotate bookkeeping responsibilities among staff to distribute knowledge.
• Accounting Software Training: Ensure your team is proficient in at least one leading accounting tool.

4.

Work with CAS Providers

Client Accounting Services (CAS) firms provide a higher level of engagement compared to traditional bookkeeping services. CAS providers offer comprehensive financial management, often integrating strategic advisory services. Because of their focus on long-term client relationships, CAS providers are typically more stable and transparent than mass-market bookkeeping platforms.

• Select Established Firms: Look for CAS providers with a proven track record and client testimonials.
• Scalable Services: Ensure the provider can grow with your business and offer additional services, like tax planning and forecasting.

5.

Review Vendor Stability Regularly

Don’t assume that because a vendor was solid a year ago, they still are today. Conduct regular reviews of your accounting service providers.

• Financial Health: Look for signs of layoffs, restructuring, or poor reviews.
• Client Feedback: Monitor forums, reviews, and social media for warning signs.
• Communication: Engage with vendors directly and ask about long-term plans or changes in services.

6.

Secure Service-Level Agreements (SLAs)

A Service-Level Agreement (SLA) is a formal contract between a service provider and a client that outlines the expected level of service, performance metrics, and responsibilities. It sets clear expectations regarding the quality, availability, and scope of services provided. A solid SLA can protect you in the event of sudden shutdowns. SLAs outline how vendors will manage transitions, provide data exports, and assist during closures.

• Data Transition Clauses: Ensure SLAs include guarantees for accessible data exports and transition support.
• Early Warning Clauses: Push for contractual obligations that notify clients of potential shutdowns ahead of time.

Alternatives to Bench – Where to Go from Here

Whether you’re still recovering from the disruption or looking to prevent future risks, finding a reliable alternative is essential. Fortunately, there are plenty of options that can help bridge the gap, and some may even offer services Bench didn’t.

Client Accounting Services (CAS) Firms

CAS providers offer more than basic bookkeeping. They provide holistic financial management, including strategic advisory, forecasting, and tax planning. Unlike large bookkeeping platforms, CAS firms focus on long-term relationships and personalized services, making them more resilient to economic downturns.

Why Choose CAS?

• Dedicated account managers and personalized service.
• Scalable solutions that grow with your business.
• Focus on long-term partnerships, not just transaction-based services.

Finding a CAS Provider

• Look for CAS firms that specialize in your industry.
• Ask for references and case studies to gauge their expertise.

Full-Service Accounting Software

If you prefer a more hands-on approach, platforms like QuickBooks and Xero allow business owners to manage bookkeeping internally or with limited outside help. Many offer automated features, real-time reporting, and integrations with other business tools.

• QuickBooks Online – Robust features with scalable plans for growing businesses.
• Xero – Intuitive interface and strong integration capabilities, ideal for small to mid-sized businesses.
• Consider a hybrid approach using these softwares and outsourcing the bookkeeping service to a qualified professional.

Virtual Bookkeeping Services

Several virtual bookkeeping providers offer services similar to Bench, pairing accounting software with human bookkeepers. These services handle day-to-day bookkeeping but may lack the advisory component CAS firms provide.

• Pilot – Focuses on tech startups and small businesses, providing bookkeeping and CFO services.
• Paro – Matches businesses with freelance bookkeepers and accountants for customized support.
• Bookkeeper360 – Integrates directly with Xero and QuickBooks for seamless financial management.

DIY with AI-Driven Tools

AI-powered platforms like Finaloop and Zoho Books automate much of the bookkeeping process. These solutions are often more affordable and provide real-time insights, making them an attractive option for tech-savvy business owners.

• Finaloop – E-commerce-friendly bookkeeping that automates reconciliation and categorization.
• Zoho Books – Comprehensive features and affordable pricing, perfect for small businesses wanting more control.

Pro Tip:

When choosing a new provider, prioritize flexibility and data accessibility. Ensure any platform or service allows you to export data easily and frequently to avoid another Bench-like disruption.

Weighing the Pros and Cons

Comparing Bench and similar models to traditional outsourced bookkeeping services can help highlight the strengths and weaknesses of each approach, guiding you toward the best solution for your business.

Pros of Bench Accounting (Pre-Shutdown):

1. Affordability – Bench’s subscription-based pricing was often lower than hiring a dedicated bookkeeper or accountant.
2. Automation with Human Support – Bench combined accounting software with real human bookkeepers, striking a balance between automation and personalization.
3. Ease of Use – Business owners with little accounting knowledge could navigate Bench’s intuitive platform, making financial management simpler.
4. Predictable Costs – Monthly flat rates ensured businesses knew what to expect, avoiding surprise fees.

Cons of Bench Accounting:

1. Limited Customization – Bench’s services often followed a one-size-fits-all approach, limiting flexibility for businesses with unique needs.
2. Lack of Advisory Services – While Bench provided bookkeeping, it lacked deeper financial strategy, tax planning, and CFO-level services that many businesses require.
3. Scalability Issues – As businesses grew and their finances became more complex, Bench’s model struggled to keep pace.
4. Data Dependency – Clients relied heavily on Bench to store and manage their data, making the sudden shutdown particularly disruptive.

Pros of Traditional Outsourced Bookkeeping Services (CAS or Independent Providers):

1. Customization and Flexibility – CAS firms and independent bookkeepers tailor services to fit the specific needs of each business, offering more personalized solutions.
2. Strategic Advisory – Many outsourced services go beyond basic bookkeeping, providing tax strategy, budgeting, and financial forecasting.
3. Scalability – As your business grows, outsourced bookkeepers can expand their services to include payroll, CFO advisory, and more.
4. Long-Term Stability – CAS firms typically have more established client relationships and transparent operations, reducing the risk of sudden service interruptions.

Cons of Traditional Outsourced Bookkeeping:

1. Higher Costs – Customization and advisory services often come at a higher price compared to flat-rate solutions like Bench.
2. Finding the Right Fit – Sourcing a reliable, experienced bookkeeper or CAS firm can take time, and the quality of service can vary.
3. Less Automation – Some traditional providers may not use as much cutting-edge technology as Bench, requiring more manual input.
4. Variable Pricing – Costs can fluctuate depending on the scope of work and the complexity of your financials.

Which Is Right for Your Business?

• Choose Outsourced Bookkeeping (CAS) if your business is growing rapidly, requires financial advisory, or needs customized services.
• Choose Automated Platforms if your bookkeeping needs are simple, predictable, and you prefer a lower-cost, hands-off approach.

A hybrid model—where you use automated software for day-to-day tasks and outsource complex financial needs to a CAS firm—can offer the best of both worlds.

Transitioning to a New Bookkeeping Solution – A Step-by-Step Guide

Whether you’re moving to another automated platform, outsourcing to a CAS provider, or managing books in-house, following a structured approach can ensure a seamless transition.

Step 1: Assess Your Business Needs

Before jumping into a new solution, take a moment to evaluate what your business truly needs. Consider the following:

• Complexity of Financials – Does your business require advanced accounting support or basic bookkeeping?
• Growth Plans – Will your bookkeeping needs expand as your business grows?
• Budget – How much can you allocate toward bookkeeping or accounting services?

Pro Tip: If your business is scaling quickly, consider CAS services to manage growth effectively.

Step 2: Gather and Backup All Financial Data

Ensure you have full access to historical financial data before your current provider shuts down. Export and save:

• Profit & Loss Statements
• Balance Sheets
• Invoices and Receipts
• Bank Reconciliations
• General Ledger

Store these files in both cloud storage and local drives to prevent data loss.

Step 3: Research and Vet New Providers

Don’t rush the decision. Compare various platforms or bookkeeping services, paying close attention to:

• Service Offerings – Do they provide tax planning, payroll, or CFO services?
• User Reviews – Look for client feedback and success stories.
• Scalability – Can the service handle your business’s future growth?
• Data Portability – Ensure you can export data easily, reducing future risks.
• Customer Service and Support - Is support available when you need it? What is the response time?

Step 4: Set Up a Transition Plan

Once you’ve chosen a new provider, create a clear transition timeline. This should include:

• Overlap Period – Run both systems in parallel for a month to ensure no data is missed.
• System Integration – If using multiple tools, integrate invoicing, payroll, and expense tracking systems.
• Training – Ensure your team is trained on the new software or service.

Step 5: Monitor and Adjust

After transitioning, monitor your new system closely for the first few months. Conduct regular reviews to identify potential gaps or errors. Schedule quarterly meetings with your bookkeeper or CAS provider to stay on top of your financials.

By taking a proactive approach, your business can avoid disruptions and improve financial management moving forward.

Building Long-Term Financial Resilience

The Bench Accounting shutdown serves as a powerful reminder that even trusted platforms can face unforeseen challenges. While no business can fully predict the future, building financial resilience ensures your company can weather disruptions without significant setbacks.

Develop In-House Financial Literacy

Even if you outsource bookkeeping or accounting, having a basic understanding of financial processes empowers you to make better decisions.

• Train Key Staff – Invest in training programs to ensure someone on your team can manage books temporarily if needed.
• Understand Key Reports – Familiarize yourself with essential financial reports like cash flow statements, balance sheets, and profit and loss statements.
• Use Accounting Tools – Learn the basics of software like QuickBooks or Xero to stay engaged in your finances.

Diversify Financial Operations

Don’t rely on a single service provider for all accounting needs. Instead, spread responsibilities across multiple platforms or professionals.

• Dual Platforms – Use one platform for bookkeeping and another for invoicing or payroll.
• CAS + Software Model – Combine automated software with advisory services from a CAS provider to gain stability and flexibility.
• Backup Bookkeepers – Maintain relationships with freelance bookkeepers or firms that can step in if needed.

Regular Financial Health Checks

Set aside time each quarter to review your financial systems, processes, and providers.

• Audit Service Providers – Ensure vendors are performing as expected and delivering value.
• Review Data Backups – Confirm your financial data is consistently backed up and accessible.
• Stress-Test Systems – Simulate scenarios where your primary accounting platform goes offline to ensure your team can manage operations.

Establish Emergency Financial Plans

Having a contingency plan in place allows you to respond quickly to disruptions.

• Identify Alternative Providers – Keep a shortlist of alternative bookkeepers or platforms.
• Financial Emergency Fund – Set aside funds specifically for operational disruptions.
• Clear Handoff Processes – Document workflows so that any new provider can seamlessly pick up where the last one left off.

Financial resilience isn’t just about avoiding risk – it’s about positioning your business for growth, even in the face of uncertainty.

The shutdown of Bench Accounting was more than just an industry shake-up — it was a wake-up call for small business owners everywhere. It highlighted the risks of relying too heavily on a single service provider and underscored the importance of building resilient, adaptable financial systems.

But as the dust settles, there’s a silver lining. Moments of disruption create opportunities to reassess, rebuild, and emerge stronger than before. By diversifying your financial tools, nurturing internal accounting knowledge, and developing contingency plans, your business can transform this setback into a catalyst for long-term growth and stability.

Think of it this way:

• A stronger, more diversified financial system protects you from future surprises.
• Investing in Client Accounting Services (CAS) or trusted professionals ensures tailored, scalable support.
• Regularly reviewing your service providers and financial health means staying ahead of the curve.

The businesses that thrive after disruptions aren’t just lucky — they’re prepared. Take this opportunity to fortify your operations, and you’ll be in a better position to weather whatever storms lie ahead.

And hey, if nothing else — at least now you know to download your financial data like it’s the last piece of pie at Thanksgiving. The next time your bookkeeping service sends an email with “Important Update” in the subject line, you’ll be ready with backups, contingency plans, and maybe even a spreadsheet of backup accountants on speed dial.

Disruptions happen, but with the right mindset, you’ll handle them like a pro. If you are looking to transition away from Bench and similar service providers, feel free to give us a call, we’d be happy to discuss your options with you!

Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial advice. Consult with a qualified professional for personalized guidance tailored to your specific needs and situation. Feel free to reach out to The Numbers Agency for a free consultation to see what how we can help!