20 years after meeting in college, these two friends created Leapfin to help businesses use AI instead of Excel spreadsheets to manage money

• 20 years after Raymond Lau and Erik Yao went to college together, they've launched a startup to help companies manage money.
• Leapfin gives companies a way to track and manage their finances in a central place with the help of artificial intelligence. It uses a buzzy new technology called robotic process automation.
• The startup just raised $4.5 million in a seed round of funding led by Bowery Capital to keep growing, and is expecting that to pay off soon. Lau said the company is on track to be profitable by Q3 of next year.
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Raymond Lau wants to solve a big problem that most companies face - managing their money. He has spent years working for finance teams within companies and was shocked at how difficult it was to have an easy way to track company finances and how archaic existing software seemed to be.

It wasn't until Lau spoke to his close friend Erik Yao that he realized he wasn't alone in dealing with this challenge. Lau and Yao have known each other for over 20 years - they went to college together at Cornell and Yao was even Lau's best man at his wedding. Both were working at different companies - Lau at Zynga and Yao at PlayHaven - and running into the same challenges when tracking the company's finances.

Eventually, they both realized there was a need to make an easier, better way for companies to manage their finances, and they could be the ones to do that. That was 2015. In the time since, they've built a product that offers a single place to manage a company's finances and uses an artificial intelligence feature called robotic process automation to make the process easier - it's called Leapfin.

"We kind of call ourselves a unified financial data platform and our mission is to really give finance executives and executives in general the ability to understand what's going on with your revenue and financials," Lau told Business Insider.

Prior to starting Leapfin, Lau was the director of business operations at Zynga. It was there that he realized the need for change. He was shocked at how most of the company's financial planning was done on Excel spreadsheets despite the fact that they were spending money to get enterprise resource planning software from Oracle and IBM.

It was also mind boggling to him that it would take 3 weeks to get a simple question about something like financial projections answered. "That's really the point where we realize, Holy crap, this system is completely broken and executives everywhere literally have no visibility into their financials at all," Lau said.

Leapfin now has a few dozen customers including Flexport, Vimeo, Canva and Dropbox and is looking to keep adding more as it grows and improves the platform. It just raised $4.5 million in a seed round of funding led by Bowery Capital to help do just that.

And, it's expecting that investment to pay off soon. Lau declined to share exact financial figures but said the company is on track to be profitable by Q3 of next year.

Hiring people to do manual tasks for 90% of their job "doesn't really make sense"

The market Leapfin is going after is ripe for disruption, Jonathan Chadwick, one of Leapfin's angel investors told Business Insider. (Chadwick is also on the board of directors for ServiceNow, Zoom, Stripe and a few other companies.) Finance is an area that every company has to deal with, regardless of how big or small they are, or what industry they're in, which presents a huge opportunity, he said.

"They are solving a problem that's not being solved very well today. And that I think presents an opportunity for lots of differentiation," Chadwick said. "A lot of it depends on what additional services they put in."

He said Leapfin is tackling financial management in a way that's not being addressed by legacy players in the space like Oracle and IBM. Companies often have many different places where money is being sent in, but not all of these are connected and easy to track in a central location with the existing software. Leapfin is offering that integration and is able to pull in information from all these different sources to give a full picture of company's finances.

Key to this is that Leapfin uses AI to help make it easier for finance teams to do their jobs, using something called robotic process automation. While that may bring up concerns about job loss, Lau said they're not too worried about that. Their main goal is helping finance teams become more efficient, and reallocating the work. One way to do that is to let humans spend more time doing the parts of the job they are good at, he said.

"It doesn't really make sense when we hire individuals and they're spending 80-90 percent of their time essentially just doing manual, tedious work around data collection, data cleansing, data validation to manually calculating revenue recognition...it doesn't make sense. Well, [what] human brains are great for is analysis and analytics," Lau said.

Chadwick thinks the main challenge the company will face going forward is being able to scale and grow the company, while still making sure their customers are happy.

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