Vic.ai, a four-year-old enterprise accounting software company that uses AI to intelligently learn from user inputs and a customer’s historical accounting data, has secured another $50 million in Series B funding from its investors.
The latest cash infusion will be used to grow its customer base for its enterprise product and add new capabilities for U.S. and European customers, the company announced on Sept. 1 (Wednesday). The $50 million round brings the company’s total funding so far to $63 million.
Vic.ai brings AI, computer vision and autonomous approval flows to a customer’s back-office financial operations, without using predefined rules or templates like traditional accounting applications, according to the company. The Vic.ai platform intelligently learns from historical data and existing processes to deliver what it calls an “Autopilot” for invoice processing and other functions, leading to significant reductions in time spent on tasks by humans, fewer errors, elimination of duplicates and improved integrations with other systems and process flows.
“The essence of the core AI engine is that accounting transactions require accounting decision-making to be accurately posted into the ledger,” Alexander Hagerup, the CEO and co-founder of Vic.ai, told EnterpriseAI. “The AI is great at making non-deterministic decisions. The AI sits in there and it is able to understand documents and transactions, make accounting decisions and create journal entries.”
Those are tasks that are traditionally done by accounting teams, but the application frees them up for more important business tasks, he said. “Our whole business is based around the core AI capabilities we have, which is actually prediction algorithms.”
Hagerup said the company began its development work about five years ago with a massive data set of documents and their corresponding journal entries to begin creating its vision. “The only thing we did for nearly three years was data science and create machine learning algorithms, and we just tried to get them to work before we even thought about any commercialization of our technology,” he said.
Human interactions are not completely removed, though, he added. There are times when human accountants must be brought in to straighten things out.
“For certain transactions, there are still humans in the loop, we have not invented something that just eradicates accountants from the Earth,” said Hagerup. “Our AI knows when to plug in a human when it is uncertain.”
Enterprise customers include Swedish real-estate management company, HSB, Intercom Inc. and HireQuest, as well as accounting firms like KPMG, PwC, BDO, and Armanino LLP.
Hagerup said that Vic.ai’s technology is fundamentally different from more traditional accounting software applications.
“Everything else out there is legacy … and rules-based,” he said. “That is largely what is in use today and we do compete with all of that. We have tons of competitors, the accounts payable vendors, the invoice processing or workflow automation applications. They fundamentally rely on rules and templates and workflow systems while we fundamentally rely on our AI, which is able to mimic human decision-making using AI technology, so it is very different and more effective.”
By doing this work for CFOs, controllers, accounts payable teams, finance and accounting teams and others, they can be freed up from time-intensive invoice processing to dive into more critical functions such as spend intelligence, benchmarking and cost optimization, said Hagerup. The software also helps reduce human errors.
The company’s name has a bit of a story. Vic is short for Victor or Victoria, and the company’s long-term hope is that customers will eventually be able to use voice commands to “talk” to the software. The idea is that in the future customers might be able to ask the application simple questions, such as “Hey, Vic or Victoria, what’s the total of that invoice?” according to a spokesman. That possibility led to the choice of its corporate name.
Vic.ai’s autonomous invoice processing replaces legacy OCR and rules-based methods, while invoices can automatically be ingested into the system from a variety of sources, including electronic file formats and EDIs, e-mail, PDFs, direct connections and more.
Once extracted, the invoice data is reviewed by the AI which then matches and processes all relevant invoice information including vendor, dates, numbers, cost accounts, dimensions, assets and purchase orders. The software is designed to work across one or multiple ERP systems and the integration can be set up using the company’s API or flat-file support.
Rob Enderle, principal analyst with Enderle Group, told EnterpriseAI that business accounting is a good natural fit for integrating AI.
“Using AI for accounting would seem ideal to assure accounting accuracy and flag potential insider theft or fraud in real-time,” said Enderle. “AI makes a great deal of sense for accounting, given accounting is numbers-based and that AI is generally more competent than humans in anything that is numbers-focused.”
Accounting is probably one of the first places where AI should have been considered for use, he added.
“It’s a place where it should not require a lot of training, particularly unique training, to make the AI function as needed,” said Enderle. “Accounting rules, unlike most other business functions, have well-defined rules that are company independent, making spooling up a competent AI in the segment relatively easy and inexpensive.”
As summer nears its end, the number of AI funding announcements have continued to climb. August 2021 has been a busy month of healthy venture capital funding round announcements for startups in fields from robotics to AI-powered applications to autonomous military aircraft flying systems.