Employer.com Acquires Mainstreet.com

Employer.com has completed the acquisition of MainStreet.com, with the financial terms of the deal remaining undisclosed. This represents the latest instance of a fintech startup being integrated into the workforce management company’s portfolio.

Merger Rationale

Jesse Tinsley, chairman and co-founder of Employer.com, announced on X (formerly Twitter) that the two organizations are “combining their strengths to streamline business administrative solutions into a single, robust platform.” Mr. Tinsley further validated the acquisition to TechCrunch.

MainStreet’s Background

Founded in 2019 and headquartered in San Jose, California, MainStreet specialized in assisting startups with identifying and claiming research and development (R&D) tax credits.

The company’s revenue model involved receiving a percentage of the tax credits secured for its clients. MainStreet experienced early success, achieving a $1 million Annual Recurring Revenue (ARR) within its first year and enabling clients to realize average savings of $51,000.

By 2021, MainStreet’s revenue had surpassed $15 million, as reported by the industry publication Not Boring.

Recent Challenges

However, indications of potential difficulties emerged in 2022 when MainStreet implemented a workforce reduction affecting approximately 30% of its employees, attributing the decision to “a particularly challenging market environment.”

At its peak valuation in 2021, MainStreet was assessed at $500 million. Subsequent financing in 2022 reportedly occurred at a $200 million valuation.

Financial Details and Investment

The specifics of MainStreet’s financial standing immediately before the acquisition are not fully public. However, Tinsley indicated to TechCrunch that the company was operating profitably.

Throughout its existence, MainStreet secured roughly $75 million in venture capital funding from investors including SignalFire, Tusk Ventures, Shrug, Moxxie Ventures, Weekend Fund, Gradient Ventures, Sound, and SV Angels.

Integration and Valuation

The introduction between MainStreet and Employer.com was facilitated by one of MainStreet’s existing investors, according to Tinsley.

As part of the acquisition, MainStreet’s team of 15 professionals will be integrated into Employer.com, which currently employs around 500 individuals across all its holdings.

Following this acquisition, Employer.com’s valuation is estimated to be slightly above $700 million, as stated by Tinsley.

Recent Acquisition Activity

Employer.com has been actively pursuing acquisitions in recent times.

In late 2024, the company announced its intention to acquire Bench, a venture-backed accounting startup that experienced a sudden closure, leaving numerous customers unable to access their accounts. Bench recently underwent a substantial round of layoffs.

Furthermore, in January, Employer.com made an offer to acquire Level, another fintech startup that ceased operations after failing to secure a buyer, but this deal ultimately did not materialize.

Strategic Alignment

“Our initial vision with Employer.com, and subsequently with the purchase of Bench, has consistently centered on developing a fully automated, end-to-end platform for managing the business back office – essentially a ‘G Suite’ for businesses,” Tinsley explained to TechCrunch.

He added that the acquisition of MainStreet aligns directly with this overarching objective.

TikTok Bid

In late January, reports surfaced indicating that Tinsley and Employer.com were collaborating with YouTuber MrBeast and others to potentially acquire TikTok, submitting an all-cash bid for the application, as reported by Bloomberg.

The status of this alleged acquisition attempt remains unclear, although Tinsley publicly confirmed in March his involvement in the $30 billion bid.

This article has been updated to reflect the correct funding amount for MainStreet.