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2020 Impact Award Winner: Louise Reed, CPA

June 10, 2021

The VSCPA Impact Award is given each year to a VSCPA member who has made an outstanding impact on the CPA profession in the areas of innovation, learning, the CPA pipeline and/or advocacy.

Want to hear more from Louise? Check out this Q&A with Louise on innovation!

Louise Reed’s most notable innovation is Afloat, a company that utilizes blockchain technology and smart contracts to automate the exchange of state transferable tax credits.

Louise received her master’s degree in physics at Duke. “I like using the power of math to see how the world works today, but being a physicist, you don’t have immediate tangible results.” Transitioning to a career she viewed as more relevant to everyday decisions and people, Louise received her master’s in accounting at UNC-Chapel Hill. After getting her CPA license and working as a sole proprietor, she stumbled upon blockchain at the CCH Connections Conference four years ago.

“Blockchain sparked the physicist in me that hadn’t come alive in 20 years. It was like learning about relativity for the first time.” She wanted to learn more and started by buying bitcoin, which took a few months to acquire. Over the next year, Louise became increasingly knowledgeable about blockchain, cryptocurrencies and smart contracts.

A friend with $500,000 worth of tax credits approached Louise to ask whether she had any clients that may be interested in buying some tax credits, but due to personality conflicts and a lack of trust, the situation became complicated. Louise realized that blockchain could help in this situation. “Because blockchain instills trust through its technology rather than individual people, it can help create a larger and more transparent market for tax credit transfers.” 

In 2018, Louise created Afloat, the blockchain-based tax credit marketplace. The first step was finding the right team. More recently, her team consisted of programmers around the world. However, the pandemic’s economic effects forced her to pivot and begin building an equity-compensated U.S. team.

Afloat enables CPAs to invite their clients, big and small, to buy or sell credits. The process is designed to allow accountants to give amount recommendations. Once within the site, Louise modeled Afloat’s setup after the bid-ask spread of the stock market. Buyers and sellers put in transparent limit orders. The vision, which is currently in beta-testing, is for the blockchain to take care of the rest, such as verifying the credits and ensuring payment. The blockchain will also allow the potential for governments to participate in the database. “My heart is in this, and I believe it will completely transform what we think of finances and how entities connect to each other.”

The current setup gives participating state governments two choices: to authenticate transactions manually on Afloat’s website or to authenticate transactions on a deeper level within the blockchain by becoming a consensus-building node.

Historically, tax credits have been bought at a discount to save money. However, Louise believes there’s an untapped market for the average taxpayer to feel more connected to where their taxes end up. For example, taxpayers are able to support historic land preservation versus ecological land preservation based on the sellers they purchase from. Louise sees a future in which governments create state transferable tax credits and where taxpayers “vote” by using tax dollars to encourage the local cause or causes of their choice.

This blockchain journey has also created opportunities for Louise to be a conduit of information by breaking down a complicated subject for CPAs and those in supporting roles. “I believe my role in this world is to transfer the association of cryptocurrency and blockchain with illegal activity to the mindset of accountability and trust.”

Louise enjoys processing the world through the eyes of Abigail Olson, her 20-year-old daughter, whose book is expected to release in the fall of 2020. In her downtime, you might find Louise going on random novice adventures, including taking an auctioneering class, racing a woolly worm, taking a surfing class and going salsa dancing.