BY LAURA LOREK
Founder of Silicon Hills News
They worked on the popular tax filing software TurboTax, but they quit in late 2013 to form their own startup to provide a better tax filing solution for simple tax filers.
“Simple tax filers, which are two thirds of the people out there, don’t have a good solution to file their taxes,” said Bill Hendricks, CEO and co-founder of Common Form, a Techstars Austin company. The other co-founders are Charles Logston and Austin Marron.
Common Form’s founders all relocated to Austin for the three month long Techstars program but they plan to return to San Diego. The company’s founders have family and roots there and it’s a good place to hire employees in the online tax software industry, Hendricks said.
Logston left his wife with their toddler and infant in San Diego so he could participate in the program. It’s been a sacrifice but it’s been worth it, Logston said. He has only flown home once to visit them over Fourth of July weekend.
“It’s a privilege to be here,” Logston said. “People come from all over the world to participate in this program.”
The three built their Common Form product in 100 days and launched on Feb. 28th and began to process peoples’ taxes, Hendricks said. Then they got accepted into the Techstars program, which has allowed them to develop it further.
“We allow people with simple finances to file their taxes in five minutes from their phone or tablet,” Hendricks said.
That’s because Common Form doesn’t ask a lot of complicated questions. It focuses on people who file the 1040EZ form, the 1040 A form and even 1040 long form filers who don’t have deductions.
Common Form wants to create a native mobile app that will let a person take a picture of their W-2 form, as well as import data from social media and let people file their taxes quickly and easily, Hendricks said.
TurboTax is the number one tax software in the country, followed by Tax Act, H&R Block, Tax Slayer, Hendricks said. In the assisted space, H&R Block is the leader followed by Jackson Hewitt and Liberty, he said.
But those programs are too expensive and complicated for the simple tax filer, Hendricks said.
“This is the first significant innovation in tax software,” he said.
The company has been using Google Ad words as well as Search Engine Optimization strategies to get customers, Hendricks said. Its also marketing through social media and word of mouth referrals, he said. And it’s looking to partner with banks and other financial institutions, he said.
In its first year, Common Form provided a completely free product while the company proved its hypothesis, Hendricks said. The company plans to charge about $20 for federal tax preparation.
“We want to be the white knight of the industry,” Hendricks said. “We want to offer a fair and transparent price.”
Common Form has bootstrapped the company to get it off the ground. They got $18,000 in a pre-seed investment and a $100,000 convertible note for participating in the Techstars program in exchange for an equity stake in the company. Now it’s raising a seed stage investment round.
“We’re excited about Common Form,” Marron said. “Taxes aren’t a historically hip startup area. But there’s huge opportunity here. Doing your taxes suck. We basically want to make all of the complexity go away and take the pain out of the process.”
The Techstars program has helped Common Form a lot, Marron said.
“We had technical experience and industry experience, what we didn’t have was a lot of startup experience,” he said. “It was great to immerse ourselves into a good startup community.”