Since the official implementation of the Golden Tax Phase IV, the tax field has started to focus on digitalization as the core, and "governing with data" has become the main direction for the development of the fiscal and tax market, with the market size of fiscal and tax digitalization continuously increasing.
According to data from Gongyan Industry Consulting, in 2022, the market size of China's fiscal and tax digitalization was 43.62 billion yuan, a year-on-year increase of 17.07%, and the market size of fiscal and tax digitalization is expected to reach 51.79 billion yuan in 2023. In addition, public data shows that the total scale is expected to reach 70.2 billion yuan by 2025, with a growth rate of 16.2%.
At the same time, the dividends of fiscal and tax digitalization have enriched many powerful fiscal and tax SaaS companies. Industry leaders such as Hui Suan Zhang and Bai Wang Yun have successively submitted IPO applications, trying to expand their scale and strengthen their strength through listing.
In June 2023, Hui Suan Zhang officially submitted a prospectus to the Hong Kong Stock Exchange, planning to use the net proceeds from the IPO mainly for business expansion; optimizing fiscal and tax solutions; enhancing technical capabilities; strategic investments and acquisitions, and for operational funds and other general corporate purposes.
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Similarly, in February 2024, Bai Wang Yun submitted a listing application to the main board of the Hong Kong Stock Exchange, planning to use the funds raised this time for upgrading existing solutions and service functions; launching new solutions to meet customers' demand for diversified solutions and services; and enhancing R&D capabilities, etc.
It can be seen that both Hui Suan Zhang and Bai Wang Yun mentioned in their listing plans that they will vigorously enhance their technical R&D capabilities in the future, and technology has become a new focus for fiscal and tax SaaS companies.
Hui Suan Zhang uses AI to stabilize the basic plate.
Hui Suan Zhang was established in 2015, with its main business being to provide fiscal and tax solutions to small and micro enterprises, relying on its SATP system (Intelligent Fiscal and Tax Program System) to help small and micro enterprises achieve full compliance, and improve efficiency and save costs in business operations and performance analysis.
At that time, the concept of "mass entrepreneurship and innovation" was very popular, and the public's enthusiasm for entrepreneurship was high. Small and micro start-ups emerged like mushrooms after rain, creating a huge demand for fiscal and tax services, providing growth space and opportunities for sustainable development for Hui Suan Zhang.After years of research and development, Hui Suan Zhang has established competitive barriers and has gained a certain position in the financial and tax SaaS field. According to Frost & Sullivan data, Hui Suan Zhang's annual revenue has consistently grown from 2020 to 2022. As of December 31, 2020, 2021, and 2022, its revenues were 275 million yuan, 347 million yuan, and 516 million yuan, respectively, with a compound annual growth rate (CAGR) of 36.9%. During the same three-year period, its gross profits were 123 million yuan, 171 million yuan, and 268 million yuan, respectively, with a CAGR of 47.9%.
Hui Suan Zhang's financial performance is robust, thanks to a solid foundation and the development of new business increments. In terms of the foundation, Hui Suan Zhang's SaaS solutions of the SATP system, as well as non-subscription professional services including consulting services and matchmaking traffic services, have shown steady performance, with an increasingly strengthened coverage of service outlets.
Data from Hui Suan Zhang's prospectus shows that from 2020 to 2022, the revenue proportion from the direct sales model targeting small and medium-sized enterprises (SMEs) has increased from 67.4% to 76.3%. As of the last practicable date, Hui Suan Zhang's direct service network has expanded to 92 service outlets in 46 cities across China.
Currently, AI is being widely implemented across various industries. To meet market demands, Hui Suan Zhang has also begun to increase its use of AI, handing over some non-core tasks that do not require accounting and tax expertise to AI. This can be summarized as: using AI to enhance service quality, contribute to increments, and consolidate the foundation.
On one hand, Hui Suan Zhang uses its own machine learning models to build the accounting engine of the financial and tax SaaS tools (SATP system), thereby better tapping into the data value accumulated from a large user base. It is understood that Hui Suan Zhang has accumulated about 262 million multi-dimensional model parameters related to the business and financial and tax processes of SMEs from over 224 million bills, forming the largest parameter set in the industry.
On the other hand, Hui Suan Zhang continues to integrate AI technology into its products, enabling them to improve accuracy and enhance customer experience, thereby expanding its customer base and increasing customer loyalty. Hui Suan Zhang's R&D investment has shown an increasing trend year by year, reaching 50.789 million yuan, 69.878 million yuan, and 85.824 million yuan in 2020, 2021, and 2022, respectively.
In summary, as we enter the AI era, using AI to reshape service quality has become the focus of competition among financial and tax SaaS players. Hui Suan Zhang will go further and further on the "AI + Finance and Tax" path.
Baiwang Cloud Leverages AI to Drive High-Quality Growth
Baiwang Cloud platform focuses on providing SaaS financial and tax digitalization and data-driven intelligent solutions, mainly offering smart solutions and invoice cloud ecosystem services in five major areas: "Smart Procurement, Smart Chain, Smart Invoice, Smart Tax, and Smart Data" for enterprises. Its revenue mainly comes from digital and intelligent solutions.
At the beginning of its establishment, Baiwang Cloud assisted Taobao in building the "Alibaba Invoice Platform," which won Baiwang Cloud a good reputation and credibility, and achieved great success. Subsequently, Baiwang Cloud launched the "Baiwang Electronic Invoice Solution" based on WeChat, further expanding its influence in the financial and tax field.Correspondingly, Baiwang Cloud's revenue has been rising, and its profitability has been enhanced. The prospectus shows that in the recent three years (ending September 2020-2023), Baiwang Cloud achieved revenues of 291 million yuan, 454 million yuan, 526 million yuan, and 468 million yuan, respectively; during the same period, the company's gross profits reached 134 million yuan, 216 million yuan, 214 million yuan, and 136 million yuan, respectively.
Although Baiwang Cloud has performed well in overall revenue in recent years, it is not difficult to see that the revenue growth rate has slowed down. In order to maintain revenue growth, Baiwang Cloud has increased its investment in data-driven intelligent solution businesses, making the income from data-driven intelligent solutions gradually become the pillar of revenue.
At the same time, Baiwang Cloud has intensified its exploration of "large models + financial and tax SaaS."
In 2023, Baiwang Cloud launched the industry, finance, and tax integration Copilot, based on large models and generative AI technology, introducing the Bai Xiaowang AI intelligent assistant, aiming to use AI technology to create a full-process digital service, and help enterprises upgrade their digital and intelligent capabilities in the fields of professional dialogue, efficiency improvement, and intelligent decision-making.
For traditional enterprises, the industry, finance, and tax integration Copilot is a powerful tool for reducing operational costs, improving financial management levels, optimizing tax planning, and helping enterprises achieve sustainable development. For Baiwang Cloud, the competition in the financial and tax SaaS market is becoming increasingly fierce. To maintain competitiveness, it is necessary to continuously improve its own innovation capabilities, and the introduction of AI technology is an important way to stimulate internal momentum and drive high and stable growth.
Baiwang Cloud's launch of the industry, finance, and tax integration Copilot deeply binds large models with SaaS applications, providing AI intelligent assistant services in six major scenarios: intelligent transaction management, intelligent business insight, intelligent procurement, intelligent risk control, intelligent marketing, and intelligent expenditure management. This move demonstrates the efficiency and practicality of large models in actual operations, highlights the advanced technology of Baiwang Cloud, and its strong capabilities in helping enterprises achieve risk prevention and business optimization.
It has to be said that Baiwang Cloud plays an important role in promoting the integration of financial and tax SaaS with large models, and it is also achieving continuous growth in this transformation.
Shuiyou Shares amplifies the value of quality and efficiency improvement with AI
Like Baiwang Cloud, in order to achieve sustainable growth, Shuiyou Shares has increased its investment in the research and development of artificial intelligence and large language models,
and has fully launched the construction of financial and tax large models in vertical fields, achieving certain results.According to the financial report data of Shuiyou Shares, the ARPU (Average Revenue Per User) of small and medium-sized enterprise (SME) customers of Shuiyou Shares has been steadily increasing, and there has been a large-scale growth in paying users of the financial and tax agency customer group. The active user base of the YeeQiWin Digital Tax and Financial Service Cloud Platform has reached 8.2 million households, a 16.3% increase from the beginning of the year, and the paying users have reached 5.68 million households, a 29.1% increase from the beginning of the year.
Clearly, Shuiyou Shares has accelerated the deep integration of large models with financial and tax SaaS, which has greatly enhanced the digital transformation and upgrading, as well as the quality and efficiency improvement of small and medium-sized enterprises, while also enhancing the platform's value.
In terms of products, Shuiyou Shares has driven a comprehensive upgrade of the product value system based on AIGC technology.
The enhancement of Shuiyou Shares' product value is mainly reflected in two aspects: First, it enhances the intelligence level of SaaS products and improves the efficiency of product services. The digital financial and tax cloud SaaS products created by Shuiyou Shares have functions such as intelligent collection of bills, automatic generation of ledgers, AI intelligent accounting, intelligent review of vouchers, dynamic analysis of tax burdens, intelligent generation of declaration forms, and cloud storage of electronic archives.
Second, it creates a compliant tax optimization product that combines expert advisory capabilities with AIGC technology, shaping a "financial and tax expert authority." It is reported that the product can deeply integrate enterprise bill and tax data assets with industry financial and tax policies, intelligently identify and generate enterprise financial and tax risks, financial and tax health levels, and intelligently generate personalized solutions and service plans.
In terms of research and development, in order to achieve new strategic goals, Shuiyou Shares has correspondingly increased R&D investment to support the company's strategic transformation and sustainable development.
With the changes in the market environment and the needs of enterprise development, Shuiyou Shares has adjusted its development strategy and made R&D one of the important development directions. Data shows that the company's R&D expenditure in 2023 was 485 million yuan, a significant increase of 53.517 million yuan compared to the same period last year, an increase of 12.42% compared to the same period last year; R&D investment accounted for 29.62% of revenue.
In the future, Shuiyou Shares will use AIGC technology to continuously upgrade product intelligence capabilities, which can enhance the value and competitiveness of products, improve the efficiency and accuracy of business processes, and may obtain more business opportunities and sources of income.
Breaking through the "difficult points" of technology and unblocking the "bottlenecks" of application, as the penetration rate of financial and tax digital construction in Chinese enterprises continues to increase, the overall market space continues to expand. Leveraging AI to create a differentiated competitive advantage will become one of the important engines for the continuous growth of financial and tax SaaS enterprise performance.Firstly, AI large models have significant applications and development potential in the field of finance and taxation. The development and application of large models for finance and taxation by SaaS companies such as Hui Suan Zhang, Bai Wang Cloud, and Tax Friend Shares have confirmed this. For instance, during the tax filing process, AI large models can analyze users' financial data and tax regulations, automatically identify potential risks and opportunities for optimization, and provide corresponding recommendations and operation guides.
Secondly, the complexity of the finance and taxation field and the vast amount of data make the application of AI large models an inevitable trend. The financial management process is complex and data-intensive, and traditional manual processing is often inefficient and prone to errors. In contrast, AI large models can learn and process large-scale data automatically, quickly and accurately completing complex financial and tax tasks, thereby improving work efficiency and reducing the error rate.
Furthermore, the application of AI large models can enhance the data analysis and forecasting capabilities in the field of finance and taxation. By learning and analyzing historical financial and tax data, AI large models can summarize patterns and predict future financial and tax situations and trends. This can help businesses and individuals make more accurate financial and tax decisions, improving operational benefits and risk management capabilities.
Of course, as finance and tax SaaS companies explore the "large model + finance and tax SaaS" model, they still need to overcome technical challenges and address application bottlenecks.
Firstly, finance and tax large models require a large amount of data for training and improvement, and during this process, finance and tax SaaS companies must ensure data security and privacy. Secondly, finance and tax large models need to be combined with more financial and tax business scenarios to solve practical problems, and scaling up is not something that can be achieved overnight. Thirdly, as technology continues to innovate and upgrade, finance and tax SaaS companies need to enhance their computing and storage capabilities to support the training and application of AI large models.
In summary, "finance and tax SaaS + AI large models" is the trend of the times. Standing in the torrent of technological innovation, finance and tax SaaS companies must seek change. Hui Suan Zhang, Bai Wang Cloud, and Tax Friend Shares are gradually mapping out their strategies, aiming to gain a favorable position in the fierce market competition. This is destined to be a protracted battle.