Dublin-based TriNet Group Inc. (NYSE: TNET), a publicly traded HR outsourcing firm, has acquired Clarus R&D Solutions LLC, a financial technology firm that bootstrapped its way to become one of Central Ohio's fastest-growing private companies.
TriNet, citing a shared focus on serving small and medium businesses, plans to continue growing the Clarus' office in Grandview Heights, Ohio, as a wholly owned subsidiary to automate the cumbersome filing for an R&D tax credit. Terms were not disclosed.
"It’s a great testament for Columbus – to be able to create a team and grow a business to be nationally recognized, and build a technology platform recognized as the best in this industry," said Chris Winslow, who joined Clarus as CEO in spring. "This is a great catalyst for our business going forward. I’m thrilled they wanted me to stay on board."
Winslow joins TriNet as a vice president to lead its newly created Tax Credits Business Unit, reporting to Samantha Wellington, executive vice president of business affairs, chief legal officer and secretary. Other Clarus leaders maintain similar roles under the new leadership, as does the entire 50-person staff.
"I believe the Clarus R+D team is a great fit with TriNet," Wellington said in the release. "Importantly, we both place SMBs at the center of everything we do. ... We are excited by this opportunity to unlock possibilities for our customers."
TriNet, with $2.4 billion in sales through the first six months of this year, approached Clarus shortly after Winslow started. Its much larger customer base exposes the tax credit software to a wider audience.
Clarus, founded in 2016 and spun out of an accounting firm that was later acquired, created TurboTax-like software to automate the process of claiming a payroll tax credit for R&D expenses – a boon for startups that aren't yet profitable and thus can't apply the credit to income taxes.
The credit was capped at $250,000 the past six years – which doubled to $500,000 with this year's Inflation Reduction Act. It's a significant source of capital without giving up equity – yet many small businesses either don't know about it or lack the resources to go through the paperwork-heavy filing process.
Revenue, projected at "tens of millions" this year, has doubled every year since it was founded in 2015. Clarus was No. 5 in Columbus Business First's Fast 50 awards last year based on growth from 2018-20, and just made this fall's list. Rankings will be released in October.
A veteran of Central Ohio tech companies and the former TechColumbus before it reorganized as Rev1 Ventures, Winslow for the past decade has worked for a Silicon Valley cloud infrastructure firm and Austin logistics tech company. The whole time he kept his family in Central Ohio, flying home on weekends.
Clarus was co-founded by Brent Johnson, an accountant who saw the possibilities of the credit, and Jeff Haskett, a serial tech entrepreneur who was CEO until tapping Winslow this spring.
The startup raised less than $1 million from friends and family, but grew through revenue since. Haskett, Johnson and close affiliates had been majority owners.
"We were thrilled we were able to come to a deal that worked out well for our employees, customers and shareholders," Winslow said.
