The first technology platform purpose-built to combat the shadow economy, announced it has closed a $13 million seed funding round, led by Team8 with participation from Citi Ventures, Cardumen Capital and private investors, including former CEO of Citi, Vikram Pandit, and former CEO of Thomson Reuters, Tom Glocer.
The company’s AI-powered technology closes the tax gap by automatically scanning and analyzing public data sources and then combining them with internal data from tax authorities for a complete picture, delivering 98% accuracy. (The accuracy of the entity matching is 98%-100% while the accuracy of identifying tax evasion in a case is 71-92%).
Having both a SaaS and on-prem offering, the technology is ultra-fast and offers accurate findings in a matter of hours – rather than months, and the AI-engine distinguishes minor from major cases so tax authorities can focus on scale infringement.
Global tax evasion is around $20 trillion annually, resulting in $6 trillion annually in lost revenue. IVIX closes the tax gap by enabling tax authorities around the world to reduce widespread evasion effectively. The company develops tailored technologies that automatically analyze public data sources to identify in-scale tax evasion. This allows tax authorities to use their resources more efficiently, increase collection, and promote deterrence.
Matan Fattal, CEO and co-founder of IVIX, said in a statement: “Clients across different geographies have told us time and again that the IVIX platform is a game-changer. Our ability to scale combined with our accuracy rate that exceeds 98% is transforming authorities’ ability to deter tax evasion, increase compliance and level the playing field.”
The seed financing will allow IVIX to grow exponentially, mainly in the areas of sales and marketing. The IVIX platform offers a powerful alternative to the manual processes, limited in-house tools and non-specialist vendor solutions in use today. Its AI-driven platform can efficiently analyze tax authorities’ internal data and scour publicly available information to identify tax evasion and fraud. The technology can be used to target large-scale fraud, for example, and satisfies stringent global fiscal standards in relation to security, confidentiality and privacy.
Already deployed in several OECD countries, IVIX has allowed authorities to quickly and accurately identify a significant number of tax infringements, including verticals where nearly 50% of businesses were not reporting income.
Ornit Shinar, head of External Innovation and Ventures Investments in Citi Israel, said in a statement: “IVIX’s technology and approach supports governments’ efforts to identify tax evasion and fraud and we see significant opportunity in the space. We have worked with the co founders and their team in the past, investing in their development of groundbreaking technologies and look forward to working with them once again.”
Don Fort, director of Investigations at Kostelanetz & Fink, LLP,immediate past chief of the Internal Revenue Service’s Criminal Investigation (CI) Division and advisor to IVIX, said in a statement: “IVIX is filling a necessary gap in tax administration data collection and analytics. Using public information to specifically hone in on the shadow economy is an essential element of using data analytics to combat tax non-compliance at the federal, state, local and international level. The flexibility and adaptability of this product will likely yield a quick return on investment.”
IVIX is a graduate of the AI for Good acceleration program led by Microsoft for Startups in Israel, which aims to help purpose-driven ventures advance their AI solutions to create positive social transformation. The AI for Good acceleration program is part of the global MS AI for Good initiative, a $165 million commitment.