Khosla Ventures is betting $10M on Ian Crosby, whose last startup, Bench, imploded

Ian Crosby, whose previous startup Bench Accounting famously shut down in 2024 before being bought for scraps, is taking another shot at building a business out of automating the arduous work of bookkeeping.

His new startup, Synthetic, aims to build a fully autonomous AI bookkeeper that can generate accrual-based financials without direct human involvement. Although the product is still in the design phase — and Crosby admits his vision may not yet be technologically possible — the startup has raised $10 million in a seed funding round led by Khosla Ventures, with participation from Basis Set Ventures and Shopify CEO Tobias Lütke.

Most investors would run from a founder facing the kind of challenges Crosby is right now — the fallout of his previous business collapsing and a vision that may exceed the technical feasibility of current foundational models. But Khosla partner Jon Chu told TechCrunch he sometimes does just the opposite: “I tend to run towards controversy a little bit.”

“In controversy, groupthink often shapes the narrative rather than the truth of the story itself,” he said, citing Parker Conrad’s 2016 ousting from Zenefits as an example. While the industry narrative was initially critical of Conrad, he subsequently founded Rippling, which is now valued at nearly $17 billion.

“I believe people have room for growth,” Chu said about his bet on Crosby and Synthetic.

Crosby maintains he wasn’t directly responsible for bringing Bench to the point of insolvency. According to him, he was fired by Bench’s board in 2021, three months after he turned down a $250 million acquisition offer from Brex. The board also disagreed with Crosby’s strategic direction, especially as the business was bleeding cash, and his executive team was reportedly frustrated with his direct leadership style.

“He took a big swing, made a few mistakes. That didn’t go well,” Chu said.

Bench ultimately imploded when its new management proved unable to restore the company to health on its own.

After leaving Bench, Crosby joined Shopify and founded Teal, another accounting startup, which was bought by Mercury 18 months later.  

As part of his due diligence, Chu said he spoke with several executives who worked with Crosby after his departure from Bench, and they all “had fantastic things to say about Ian,” Chu told TechCrunch.

Chu is convinced that the three roles Crosby held after leaving Bench provided the entrepreneur with ample opportunity to learn from his past mistakes.

Crosby says he has his eyes firmly set on creating a fully AI-driven bookkeeping service, rather than relying on human accountants, as most accounting startups such as Xero do now.

“We're not going to release anything that's not fully autonomous,” Crosby told TechCrunch. “It’s that or bust.”

Synthetic plans to serve only AI and other software startups. But Crosby acknowledges that AI models still make significant bookkeeping mistakes. While Synthetic's prototype works for a narrow group of users, he remains uncertain how it will scale for a broader customer base.

Crosby explained with an analogy: “It's like a self-driving car that can drive down one street versus the self-driving car that can drive down any street. We haven't driven down enough streets to know if it's going to crash.”

Still, the founder says he can afford to be patient and wait for foundational models to become more reliable for bookkeeping calculations.

“I've raised years of cash, so we can just wait it out,” Crosby said.

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