Segtax founders Gregory DiNardo (left) and Joe Acanfora.
Less than a year after its launch, local real estate accounting startup Segtax is growing its team and capital base.
The company, which offers cost segregation study software to assist calculate depreciation on a property, recently closed on a roughly $750,000 capital raise, co-founder Gregory DiNardo notified BizSense this week.
Segtax launched raising the round last year, having closed the first tranche in May. The entire round closed in November.
Participants in the round included local investor Michael Jarvis and his network of angel investors, as well as Virginia Innovation Partnership Corp. and Williamsburg-based venture capital firm ShockVentures.
“It was a really good group of investors, mostly local,” DiNardo stated. “Pretty much all of it was Virginia-based.”
Segtax publicly launched last June. The startup utilizes a software tool to automate cost segregation studies, which assist CPAs, real estate owners and investors calculate depreciation, specifically in the contents of a building like cabinetest, furniture and flooring.
Historically, a civil engineer would visit a property and manually measure its contents to create a cost segregation study. Segtax automates much of this process utilizing things like 3D scans of a property.
Once scans are completed, Segtax runs them through its software and gives customers a report for review. DiNardo notified BizSense last June that for a real estate investor wanting a study on a single-family home or a tiny multifamily property, one of Segtax’s studies costs around $2,000-$3,000. For larger multifamily buildings, the cost is $3,000-$4,000. DiNardo stated this week that the startup has grown its capabilities to create studies for larger, commercial-utilize buildings too.
With the new funding in tow, DiNardo stated the company will see to “remain capital efficient” while considering additional real estate tax services, potentially working with homeowners beyond the acquisition of their homes.
“I consider there’s opportunities to insert ourselves deeper into the tax world throughout the ownership cycle. … There’s tax opportunities at the launchning, tax opportunities while you own and tax opportunities at the selling point,” he stated. “We really want to be able to assist real estate owners throughout their entire real estate journey.”
SegTax is utilizing an automated process and a 3D model, pictured here, for cost segregation studies. (Photos courtesy Segtax)
Since its launch, Segtax has completed more than 200 cost segregation studies, DiNardo stated this week.
He stated although the company early on focutilized heavily on 3D scans to create reports, it has also begun utilizing other forms of data, such as a property’s settlement statements, surveys, appraisals and floor plans, to inform its reports.
DiNardo added that while the startup previously focutilized only on existing homes and other structures, it has opened its studies to new construction projects, too.
“And if it’s a new construction project, it’s seeing at AIA construction documents, if there’s modify orders, floor plans, all that, ingesting all of that kind of data,” DiNardo stated. “(While previously) it was focutilized on one source of data … it’s a lot more flexible. We can basically support any property type.”
He added that though Segtax started out working with real estate investors, it has also begun working more directly with CPAs, a goal he spoke of upon the startup’s launch in June.
“They understand the taxpayers’ complete situation, and we want to create sure we’re working parallel with tax professionals,” he stated.
He added that Segtax is offering white label studies branded under various CPA firms. That offering could grow further in the future.
DiNardo stated the company has grown from just him and co-founder Joe Acanfora at its founding to eight full-time employees and two contractors, spanning from new software engineers to new cost segregation specialists.
And with tax season ramping up over the next few months, DiNardo stated Segtax is hoping to increase the number of cost segregation studies and to potentially add other real estate tax services in the future.
“Ideally we’ll stay really focutilized on this real estate tax space,” he stated. “There’s a lot of potential avenues we can go down.”
He added that Segtax will likely see to another capital raise sometime this summer but declined to comment on how much it might seek to raise.
Segtax is not currently profitable, with DiNardo declareing the startup is currently “right around breakeven” and focutilized on further growth.
Segtax is based out of incubator Startup Virginia at 1717 E. Cary St. It relocated there from Scott’s Addition coworking space Venture X late last year.
DiNardo is originally from Maryland and started his career as a CPA at RSM before relocating into the software world. He co-founded market research and competitive innotifyigence company Arbit, later acquired by New York-based Ceros in 2019. He relocated full-time to Richmond in 2020.
Acanfora is from upstate New York and relocated to Richmond soon after his 2015 Virginia Tech graduation. He’s held positions as a software engineer at the likes of UZURV, Mission Lane and most recently Meta.
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