Khosla Ventures Bets $10M on Ian Crosby After Bench Implosion

Ian Crosby, whose previous startup Bench Accounting famously collapsed in 2024 before being acquired at a low price, is now trying again to build a business around automating the tedious work of bookkeeping.

His new venture, Synthetic, aims to create a fully autonomous AI bookkeeper that can produce accrual-based financial statements without direct human involvement. Although the product is still in the design phase—and Crosby acknowledges his vision may not yet be technically feasible—the startup has raised $10 million in a Seed round led by Khosla Ventures, with participation from Basis Set Ventures and Shopify CEO Tobias Lütke.

Most investors would steer clear of a founder facing the kind of challenges Crosby currently faces: the aftermath of his previous business’s collapse and a vision that may outstrip what current foundational models can achieve. But Khosla partner Jon Chu told TechCrunch he sometimes does the opposite: “I tend to lean into 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 initially criticized Conrad, he later founded Rippling, which is now valued at nearly $17 billion.

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

Crosby maintains he wasn’t directly responsible for driving Bench to insolvency. According to Crosby, 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 burning cash, and his executive team reportedly grew 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 acquired 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 gave the entrepreneur ample opportunity to learn from his past mistakes.

Crosby says he is firmly focused on creating a fully AI-driven bookkeeping service, rather than relying on human accountants, as most accounting startups like Xero currently do.

“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 errors. 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.