H&R Block Acquires Wave Financial

H&R Block announced that it entered into a definitive agreement to acquire Wave Financial, a Canadian financial solutions platform helping small business owners manage their finances, for $405m in cash. The transaction is expected to close within the next few months, subject to regulatory approval and customary closing conditions. Based on the expected timing of closing, H&R Block estimates that the transaction will generate $40 to $45 million of revenue for fiscal 2020.

Founded in 2010, Wave offers free accounting, invoicing, and receipt-tracking solutions while generating revenue by offering payment processing, payroll services, and bookkeeping services. The company raised ~$79.5m and is used by over 400k small businesses globally every month.

“I’m extremely excited to welcome Wave, an innovative company with an outstanding team, to H&R Block. Bookkeeping and cash flow management are significant pain points for small business owners and essential to successful annual tax preparation. Wave addresses these concerns by delivering financial solutions and a simple user experience on a single platform. Wave provides us the opportunity to accelerate our small business strategy and is a great strategic fit, as both companies can leverage each other’s capabilities to bring tax and financial solutions to small business owners, serving more clients in more ways.” – President and CEO of H&R Block Jeff Jones.

“Given the complementary strengths of these two great companies and our shared vision of providing financial help to people who need it, we’re delighted to be joining the H&R Block team. We are excited to work together to deliver additional value to small businesses to help them succeed.” – Wave’s cofounder and CEO Kirk Simpson.

Bottom Line: We’re living in a digital world of diminishing boundaries.