Avalara, a tax compliance automation software, was founded on a small island in the state of Washington. Rory Rawlings and Jared Vogt, co-founders, had an idea to take geospatial information and combine it with rates, source, and taxability rules into a single engine. To bring their vision to the market, Rory and Jared brought on Scott McFarlane as CEO of Avalara. Avalara can calculate in one sub-second, store the information, then report on that information, create a return for the right jurisdiction, and remit the money.
With Rory’s idea and engineering capabilities, tech-savvy Jared Vogt, and Scott McFarlane’s ability to lead and business mind, the threesome set out on a journey that has surpassed all they thought it would be.
Jeff Roth, VP of Strategic Alliances, answered our top questions about Avalara.
How has Avalara evolved since its inception?
Avalara has grown exponentially to downtown Seattle, next to Century Link Stadium in Avalara Hawk Tower, where hundreds of Avalarians come to work every day. During the early days, Scott and the team went to Microsoft’s Convergence trade show to introduce Microsoft users to Avalara. Microsoft is still one of Avalara’s strategic partners today. They wanted to stand out from the crowd being new, so they wore bright orange shirts, built a tiki design booth, complete with a margarita machine. This instance truly embodied Avalara’s original tagline of “Making Sales Tax Less Taxing, More Relaxing.”
Whenever sales tax was mentioned to attendees, the response was the same. Everyone hated it, too complicated, the list goes on. Unfortunately, sales tax compliance is a necessary evil, but Avalara is here to help. The sales team started a tradition in the office of ringing a bell every time a deal closed and called it a “ding.” Nowadays, every employee gets a “ding” email when a deal closes. The color orange is huge for Avalara culture, and Scott will tell you, “we’ll always stay true to the orange!”. It’s a bright, noticeable, unique color that stands out, which is what Avalara is all about.
What kind of feedback have you heard from your clients?
Clients are relieved they no longer have to spend hours on a non-generating activity like tax compliance. Avalara customer, Jean Treimanis, CFO of JL Marine, says, “It really has made the whole process more manageable. I don’t even have to think about it. I feel confident with what we can provide to any state auditor who comes in; And we can do it remotely because they can access my information easily over the Internet.”
What are the most common questions that you hear from potential and current clients?
Generally, when it comes to ecommerce or remote sellers, clients are concerned about sales tax in their multiple sales channels. Some of the most common questions are:
- Does AvaTax integrate with my current shopping cart and/or ERP?
- Can I access my data any time, anywhere?
- How do you handle marketplace selling?
- Does the tax engine take drop shipping into consideration?
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What does an ideal client look like?
The beauty of Avalara is that anyone can use these products. We offer a volume-based subscription model for everyone from mom and pop small shops to large enterprise, international clients. Because you pay for your usage and type of integration, the options are endless.
What makes Avalara unique?
Avalara is unique in many ways. Avalara is truly cloud-based, no hardware to install, with over 700+ integrations into ERPs, shopping carts, POS systems, and even offers an API for homegrown systems. Avalara is international and in almost every country, with tax compliance ranging from value-added tax (VAT) to communications, lodging, alcohol—the list goes on. Avalara offers an end-to-end tax compliance solution that includes calculation, returns filing, and exemption certificate management.
Where do you see Avalara in five years?
Avalara is unique, where the only constant at the company is change. The company is consistently growing, adding features and data to assist omnichannel clients make tax compliance an automated system that works in the background while clients build their business. In 5 years, Avalara will add more content, efficiency, and will be well on the way to Scott McFarlane’s goal of being a part of every tax transaction in the world.
What are you most excited about for the future of Avalara?
Avalara is excited to continue efforts to supply excellent product and customer service to all clients with the ever-changing tax landscape. As legislature continues to become more and more complex, i.e. economic nexus, Avalara will be there for clients as a trusted advisor. The company is ecstatic to add more and more content, making the product robust, efficient, and effective. The future of Avalara is exciting and racing full speed ahead.
What are examples of how brands and retailers are leveraging Avalara?
Berkshire Blanket was managing their tax compliance manually, but once they opened their online retail shop, things got a little hairy. Berkshire was grateful for Avalara’s “set it and forget it” implementation and continued service.
“We have some very audacious growth plans,” says Emily Pfeiffer, VP of Marketing & Digital at Berkshire Blanket. “The kind of volume we’re planning will rely one hundred percent on Avalara’s ability to help us scale. I can honestly say that having Avalara will enable that kind of growth, because we know we’re covered.”
Dylan’s Candy Bar
Dylan’s was dealing with a number of challenges that Avalara addressed, including new product lines, distribution channels, and more complicated nexus requirements. As the company grew, complexity increased, and so did their tax exposure. As Dylan’s Candy Bar continues to expand, Avalara is working in the background to mitigate their tax risk.
With AvaTax, Avalara Returns, and CertCapture, Lois Browne (VP of Finance) and her team no longer spend energy on calculating and collecting taxes, filing across multiple jurisdictions, and complying with exemption requirements. Instead, the team has been liberated to focus on other automation priorities that help Dylan’s pursue its aggressive growth goals. The team no longer lives in fear of the auditors, as well.
Hickory Farms needed a technology infrastructure that would enable their growth, as opposed to preventing it. The company was able to deploy Avalara with their multi-channel sales approach including retail stores, point of sale operations, and their online store. One platform for tax compliance for all channels.
Matt James, COO, says, “It’s complicated enough to get the sales tax correct at the local store level for cash-and-carry transactions,” Matt laughs. “Now we’re adding the complexity of shipping to someone in another jurisdiction. But we believe it will be an exciting, new customer experience, and AvaTax will handle the tax calculations at the point of sale.”