Bench, the Canadian accounting startup that abruptly shut down over the holidays, has filed for bankruptcy, revealing a staggering $65.4 million in liabilities, according to documents obtained by TechCrunch. The filings, which include one for Bench and another for its original name, 10Sheet, show that the company had only $2.8 million in cash on hand by the end of its life.

Founded in 2012, Bench had raised a significant $113 million from investors, including Shopify and Bain Capital Ventures. However, the company's financial struggles ultimately led to its downfall. The majority of Bench's debt, $50 million, is owed to the National Bank of Canada, one of Canada's largest commercial banks. Notably, over 85% of this debt is unsecured, meaning the bank has little collateral to claim against the loan now that Bench has defaulted.

The bankruptcy filings also reveal financial obligations to Bench's venture capital investors, including convertible notes and direct shareholder loans. The company owes $1.3 million to Bain Capital Ventures, $1.2 million to Inovia Capital, $750,000 to Contour Venture Partners, and $777,000 to Altos Ventures. All of this VC-related debt is unsecured, according to the filings.

In addition to its debts to investors, Bench also owes $1.8 million in severance pay to former employees, who were suddenly let go on December 27 with no notice or severance provided. The company's former executives, including CEO Jean-Philippe Durios, CRO Todd Daum, and CFO Mor Lakritz, are also listed in the filings as being owed tens of thousands of dollars in severance pay.

Bench also owes $4 million in unpaid rent to Canadian real estate agency Morguard, likely for its office space. At its peak, the company employed over 600 people. The filings do not provide a clear picture of how the rest of the money was spent, leaving many questions unanswered.

As Bench navigates its way through bankruptcy, it is also in the process of being acquired by San Francisco-based HR tech company Employer.com. However, this acquisition has raised concerns among customers, who have been told that they must turn their data over to Employer.com or risk losing it. Gary Levin, head of corporate development for Employer.com, emphasized that the Canadian court is overseeing Bench's insolvency proceedings and will supervise the distribution of proceeds to creditors. He also highlighted Employer.com's strong balance sheet, which will allow the company to invest significantly in Bench moving forward.

The bankruptcy filing and acquisition by Employer.com raise important questions about the future of Bench's customers and employees. As the situation unfolds, it will be crucial to monitor how the company's assets are distributed and how its stakeholders are affected. The collapse of Bench serves as a cautionary tale for startups and investors alike, highlighting the importance of prudent financial management and responsible growth strategies.