XU Magazine - Issue 01 - Digital Edition - Preview by XU Magazine

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XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

XU magazine The independent magazine for Xero users, by Xero users Issue 01, Aug - Oct 2014 Co-Founders: David Hassall, Wesley Cornell Editor: Wesley Cornell Contributing Writers: Michael Wood, Steven Renwick, Alexander Kohl, Matt Wilkinson, Guy Letts, Heather Smith, Jonathan Clarke, Dan Fairbairn, Doug Sleeter, Richard Francis, Hannah McIntyre, Amy Harris, Craig Baldwin, Nathan Carter, Peter M. Vessenes, Jared Armstrong, Colin Hewitt, David Tuck Front Cover: Pictured: Hannah McIntyre and Amy Harris Photographer: Igor Burbela of Venture Photography Leicester, UK Ambassadors: Heather Smith (AU), Gayle Buchanan (NZ), Jonathan Gaunt (UK), Kirsten Barrie (US), Carol-Ann Brouwer (CA) Editorial/News Submissions: In the first instance, please send editorial, news stories, requests and enquiries via your country’s ambassador (email addresses overleaf ). For general submissions, please email: editorial@xumagazine.com Advertising: advertising@xumagazine.com T: +44 (0)116 298 60 80 E: hello@xumagazine.com W: www.xumagazine.com

‘Xero’ is a trademark of Xero Limited (New Zealand). XU Magazine is collaboratively produced by an independent group of Xero users and is not affiliated in any way with Xero. All other trademarks are the property of their respective owners. © XU Magazine Ltd 2014. All rights reserved. No part of this magazine may be used or reproduced without the written permission of the publisher. XU Magazine is published by XU Magazine Ltd (08811842), registered in England and Wales. Registered office: 198 Welford Road, Leicester, LE2 6BD. All information contained in this magazine is for information only and is, as far as we are aware, correct at the time of going to press. XU Magazine cannot accept any responsibility for errors or inaccuracies in such information. If you submit unsolicited material to us, you automatically grant XU Magazine a licence to publish your submission in whole or in part in all/any editions of the magazine, including in any physical or digital format, throughout the world. Any material you submit is sent at your risk and, although every care is taken, neither XU Magazine nor its employees, agents or subcontractors shall be liable for loss or damage. The views expressed in XU Magazine are not necessarily the views of XU Magazine Ltd, its editors or its contributors.

WELCOME TO ISSUE 01 ‘Twas the night before Christmas’ 2013 (literally!) when the idea came to us... our vision was to make an independent magazine for our fellow Xero users: business owners, advisors, integrators, developers, accountants and bookkeepers.

IN THIS ISSUE:

Only a few months ago, we set about raising funds to bring to fruition our vision of a magazine for the ever growing community of over 334,000 Xero users worldwide. Our aim was to raise US$25,000 to cover the initial costs of making the magazine. After launching our campaign in late March on Indiegogo, one of the world’s largest crowd-funding websites, it took only a week for us to achieve over 50% of our target. We were encouraged by Xero users globally, who have supported us on this journey. We are continually grateful.

At the end of the 22 day campaign, we not only achieved, but exceeded our initial funding goal. This was due to the overwhelming support and generosity of the Xero user community, our advertisers, contributors, and founding supporters (see overleaf ). Right from the start, we opened ourselves up to suggestions, and encouraged you to get involved with the magazine. With so many people wanting to help us out in any way they could, and to alleviate the time zone differences, we decided to put in place our country ambassadors. So many of you have provided editorial, news stories, images... and words of wisdom! Thank you to everyone who has stuck with us on this journey. We could not have done it without you. Months of planning and hard work have gone into this magazine and as I am currently writing I notice that I am burning the midnight oil again. A holiday is a lovely thought but next on the agenda is to pack for XeroCon Sydney where we are launching this very magazine. Without further ado, we present to you our inaugural edition.

+ much more

Wesley Wesley Cornell - Editor

Used with permission: diyaccounts.com

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Introducing:

XU Magazine’s Ambassadors To cope with the immense number of submissions that have been sent in from fellow Xero users (and to get around the time-zone differences!), we appointed five country Ambassadors*. Please send in any editorial, news stories, enquiries and requests via your country’s Ambassador.

Our US Ambassador is Kirsten Barrie. With over 10 years of experience in the financial world, Kirsten is a Xero-Certified Financial Advisor. She is the Owner and Chief Cloud Integrator at Verte Consulting, based in San Francisco where she and her team expertly integrate several Add-ons with Xero. To contact Kirsten, email us@xumagazine.com

Heather Smith from Australia is the author of the Xero for Dummies series, host of the Cloud-Stories.com Podcast, a Xero Advisor and Chartered Certified Accountant. She provides remote Xero Set-Up, Support and Training, and loves any opportunity she has to write. You can get in touch with Heather by email at au@xumagazine.com

Gayle Buchanan is well-known amongst Xero users through her activity in the Xero Community Forums. She is the founder of Number Nurses, cloud integrators who specialise in helping business owners and accountants to master applications like Xero, Xero Add-ons and the Google-Suite. For those of you in New Zealand, get in touch with Gayle at nz@xumagazine.com

Jonathan Gaunt is the XU Magazine Ambassador for the UK. After working in ‘big’ businesses, Jonathan made a move over to working with small businesses, primarily in the creative and technology sector. He is the founder of FD Works, based in Bristol, UK, and an enthusiastic fan of Xero and it’s Add-ons. Contact Jonathan at uk@xumagazine.com

Most recently, we appointed CarolAnn Brouwer as our Canadian Ambassador. Carol-Ann is a global certified Xero trainer, professional speaker and successful entrepreneur. Inspired by Xero, she founded Accounting AnyWhere, committed to moving businesses over to the Cloud. Welcome Carol-Ann by writing to ca@xumagazine.com

* Ambassadors are rotated on a yearly basis

Founding Supporters: XU Magazine’s Patrons

Funded on:

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

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Andrew Whyte

Andrew Whyte Landscape Design

Issue 01 / 5

X E RO B2B IS DEAD

IT’S TIME FOR H2H! Words: Staff writer

TimeCamp is time tracking software created for businesses to make them more profitable and easy to run. Their clients are mostly software houses, internal teams as well as digital, creative and advertising agencies.

XU Magazine discovered TimeCamp’s blog and felt an affinity with their approach to bringing back the premium tool in the box: relationships. When we got in touch, we learnt... The team at TimeCamp wanted to bring a different approach to business networking, influenced by the marketing book, “Human to Human: H2H” by Bryan Kramer. Inspiration came from the concept that the most valuable tool in any business is, “an underlying relationship with a person, or people, at your brand that makes them feel uniquely special”. Here was born the idea through which TimeCamp would show that their integration with Xero wasn’t just about software, but about a more human connection being made. TimeCamp staff made personalised cards (see images) for 120 Xero employees and then organised a photoshoot where they had pictures taken, holding up

6 / Issue 01

the messages. These were sent to the individuals working at Xero… So how were these received? TimeCamp said, “The success of the campaign was beyond what we expected. Xero’s feedback shocked us with it’s positive energy. We received dozens of kind and appreciative emails saying that what we did was a fantastic idea. Moreover, messages came also from Xero Partners who wanted to learn more about our software!” The innovation that TimeCamp used to come up with a simple but effective way of establishing contact with Xero created the same sense of community that lies at the heart of XU Magazine.

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

Software is eating the world Imagine that you are standing on a ladder, and the bottom of the ladder is on fire... The ladder is made of wood and the flames are licking up ever higher. It is getting uncomfortably hot. If you stand still you will get burnt, but if you keep climbing up you will be fine. This is a good way to think about technology in your business - standing still isn’t an option. But why? We all interact every day with businesses that are decades old; why is standing still not an option? It is not as though all our clients are clamouring for us to change... In Silicon Valley, they talk about how “software is eating the world”. What they mean by this is that software will play an ever greater role in our lives and in our businesses. Most businesses first used software products made by Microsoft, then they saw the value in using Google, then Twitter, WordPress, Salesforce etc. This growth occurs because popular

software does at least one of three things: it does something we already do for less cost (e.g. a Skype call over a telephone call), it does something we already do in less time (e.g. an email over a letter) or it does something completely new (e.g. search for and read millions of articles about the Titanic). These huge, powerful advantages mean that software has a gravity: if a task can be done by software then it will be done by software. This has been evident in the impact that the Internet has had on newspapers, bookshops, the music industry, etc. But we can also show its impact with a simple example: Imagine a lemonade stand. A nice simple business; it only requires five tasks: sourcing lemons, sourcing sugar, sourcing water, making lemonade, selling lemonade. Now, let’s say that people are buying lemonade at $1 per cup and let’s say our owner/manager - Sarah - needs to make 50c per cup in order to stay in business. To keep the maths easy let’s say that each one of the five tasks cost 10c each. Simple. Now let’s say a new technology emerges that can reduce the price of sourcing lemons from 10c to 5c. Sarah can stand

still - she doesn’t have to use the new technology and she can keep doing what she is doing. However it is inevitable that one of her competitors will use the new technology and they will either use it to increase their margins - to 55c per cup - or they will use it to decrease the price of lemonade to 95c per cup. Either one is bad news for Sarah. Either her competitor now has lower prices or they have a greater margin that they may use for hiring better staff, increased marketing, etc. This is exactly what has happened in the accounting and bookkeeping world. Online accounting is a very significant new technology - it is software that does something we already do in less time. This means that it confers an advantage onto the business that is using it. But Xero is not ordinary online accounting software. Xero is significant because it actually encompasses four distinct technological leaps: 1. 2. 3. 4.

online accounting / one ledger bank feeds easy-to-use (beautiful) User Interface an open API with an ecosystem of Add-ons

Each one of the first three of these is a significant development that enables the user to do something the business is already doing in less time. Number four may do this but it may also allow the user to do something completely new.

Words: Michael Wood of Receipt Bank Michael Wood is the Co-Founder of the #1 Xero Add-on Receipt Bank. Before founding Receipt Bank, Michael built and helped to build a number of different businesses including an accountancy practice. Michael’s views and opinions on technology have been featured in The Wall Street Journal, The Financial Times, Newsweek and other leading publications around the world.

Receipt Bank is the award-winning Xero Add-on that turns your invoices, bills and receipts into Xero data. Receipt Bank is used by more than 1,000 Xero accounting and bookkeeping firms around the world and thousands of small businesses. Receipt Bank is currently the Xero ‘Add-on of the Year’ in the UK and Australia and has a 5* rating in the Xero Community.

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Issue 01 / 7

To date, the firms that were early to adopt Xero have been rewarded by winning clients who were eager to move to the cloud (and claim these advantages for themselves). Now we are beginning to see the emergence of the firms who utilised this new technology and are approaching the market with either lower prices or greater margins. And we are seeing those that stood still feeling the heat.

In January, The Economist did a special feature on the future of jobs. They evaluated which industries were most susceptible to new technology: accountants and auditors were rated as one of the most at risk with only a 6% chance that computerisation wouldn’t lead to job losses. These job losses will occur but they will not be evenly spread across the industry. They will disproportionately hit those who have stood still. Those who have not adopted new technologies to reduce costs, to reduce their time requirements or to do something new.

Know your money Track your fundamental business metrics

“...by adopting Xero (and reading this magazine), you now have a competitive advantage over the majority of your peers.”

Subscribe for free to read the full magazine But an article about technology should not be gloomy - there are too many opportunities for that.

Make better business decisions

Emerging Business CFO

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Although Xero is wildly popular, the majority of accountants and bookkeepers aren’t yet using it. That means that by adopting Xero (and reading this magazine), you now have a competitive advantage over the majority of your peers. For some, that advantage may be something that can be leveraged in the job market, for others it is an asset for your business. But don’t stop there. Xero is a fantastic gateway to new technology for accountants, bookkeepers and small business owners. But there is more that technology can do for you…

Have you tried Zendesk? It can allow you to measure how quickly your team responds to customer emails. Have you tried Trello? It gives you powerful project management without the need for Gantt charts. Have you tried Pipedrive? Finally a way to manage your customer data that is a delight to use.

xumagazine.com/

The people who work in Silicon Valley are some of the smartest people in the world, and they are right - software is eating the world. This is a trend that is both a threat and an opportunity. Something that is both scary and exciting. The only way to take advantage of it? To keep climbing.

would you fish for a whale from a kayak?

sometimes

the obvious isn’t that obvious!

from a kayak?

think we

we have all the answers! www.kendons.co.nz Further Reading: Software is Eating the World - Wall Street Journal http://tinyurl.com/ng8zwut

8 / Issue 01

oh and ALL that old school stuff too ... Financial Reporting  Business Strategy Taxation  Audits and Reviews  Valuations Software Solutions

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

AN INTERVIEW WITH:

RODDRURY

Rod Drury explains that we’re coming to the end of the initial introduction of cloud technology. “What we’ve been doing is taking boring accounting as it’s been done before and putting it into a cloud environment, which means you are getting the normal cloud benefits of no backups, any time, any device, and also the collaboration benefits. That’s just the inherent advantage of moving accounting into a cloud-type environment.” He goes on to say, “Now what we’re excited about is the next phase where you get the benefit of being in the network, but utilising other data sets that we can connect to on behalf of all customers. For example, you log into your iPad and you’re seeing this window into your business and all this other stuff is just flying around and doing things for you overnight. Has this supplier gone out of business? Is there a financial risk working with them? The systems are checking your metrics, and alerting you to the things that you need to know about. The software is watching your back and proactively telling you when you should be doing actions that will drive opportunities to you.” He further explains, “The first phase was getting the data into the cloud, and we’ve already seen the compelling benefits of that. The next phase is when the service does other work for you proactively. I think we’re not that far away from that. We’re investing a lot in this already.” Xero revolutionised the accounting industry when they were instrumental in pushing bank feeds into accounting solutions used by the end user. “What we realised was that the some of the pain around small business processes is the interface between the banking industry and accounting software. We’ve already seen the benefit of getting those things together.” Now that the Xero ecosystem has some size and momentum behind it, Xero are able to encourage the banks “to make their systems more open so we can do more on behalf of accountants and bookkeepers.”

XU Magazine sat down with CEO and Co-Founder of Xero, Rod Drury, and this is what he shared with us…

Interview by: Kirsten Barrie Words: Staff writer Image: Used with permission We want to hear from you! Get in touch - email: hello@xumagazine.com

Believing accountants and bookkeepers are the key to small business productivity, Drury says, “As we look at it through that lens, we can see a model of agency into banking systems, where accountants can be granted access to some functions in Internet banking that we’re actually now getting”. This is the beginning of the concept coined Banking 2.0, the idea that banks open up their APIs and allow business applications to connect to banking services. He goes on to outline what Banking

Issue 01 / 9

2.0 could look like: “We’re now getting better electronic connectivity between application software and the banks, and we’re also getting them to think about having accountant and bookkeeper interfaces”.

services out to the UK and we’ve had some US partners that are helping some of the Add-on providers in Australia and New Zealand to get into the US.” Drury’s old fashioned reference to Mad Men does not go unnoticed. Via his prolific twitter account @RodDrury he shares his love of popular culture, frequently mentioning shows he’s currently watching; Mad Men, Broadchurch, House of Cards and pictures of ramps he’d like to skate or waves he’d like to wind surf on.

According to Drury the US and Australian banking sector are looking at the journey the major New Zealand banks are benefitting from with Xero. He’s excited to be having conversations with all of the major Australian banks, developing relationships with Citi and First National, As a business, Xero is expanding and expects further US bank rapidly. In the last year Xero has announcements over the next doubled their workforce, and few months. “Smaller tripled their development countries get to scale capability shifting from faster and you can use “...having the a centralised team, that to really drive patience to wait eight into a fully distributed things forward”. years to have the right development team. This From his travels, and to do the cool stuff is has come with growing pains; “There’s quite discussions with Xero excruciating.” a lot of trauma of going advisors and staff, Drury through that jump. You go finds it fascinating that from having very few product Xero has opened up the managers to having a team of opportunity to work with people 10+ product managers running distributed all over the world. He explains “We are teams. It may have appeared that we building these global businesses now, and slowed down a little bit for the last year as building a community of people that we we go through that transition, but we’re really enjoy hanging out and spending time through it now so you’ll see our cadence with, with no borders. To me, this is the fun increase with a whole lot of new innovation part of the job, getting to know people all going across the board.” over the world”. Drury goes on to share his observations of attitude change towards the export evolution of the services industries. “We love seeing service businesses starting to export. This is really important for smaller countries. The smaller countries, especially a country like New Zealand, have a very small market and most of the exporting that is done is manufactured goods. Most of the smaller economies are service-based economies. With technology like Skype, Fuze and GoToMeeting you can now have services businesses that export as well.”

“The problem with horizontal accounting software is that there is a massive amount to do. Not only have we been building the small business side of accounting. We also knew that in parallel we had to build the accountant side of accounting, because in the cloud they have to come together too. Why would an accountant recommend small business accounting software that doesn’t have the accountants’ side of the equation? We haven’t just done the small business side; we have this massive investment to do on all of the accountant tools like ‘My Green Xero’.” He continues; “Then we also have the ecosystem partners who are filling in any of the gaps. Now we’ve got the team in place, we’ve got through some of the things that we had to do, we’re now going through and completing everything else.”

that desktop accounting software does, our view is that we can then go forward with the business processes. Accounting software traditionally just records things but then you say, ‘how do you come back to have more forward functionality in the business processes to add value to small businesses?’” Drury goes on to outline how he would like to see Xero interface with the daily reality of a small business provider. “The bit before invoicing a transaction is when you’ve got a job sitting on the fly. We want to get it into a nice simple jobbing so that, whilst you’re actually working on a job, you have really good visibility of exactly where you’re at against the budget and can communicate easily with your customer - because if you get that interaction right, you’ll absolutely make some more money.” He goes on to say, “Before doing a job, there’s the quote, and when you’re doing the quote, it’s not just about winning the business, it’s about getting the recording of the job ready, so you’re recording the right things so you can manage it.” Reminiscing about the scepticism he endured during the early days of Xero, Drury shares that people would say to him accounting software has been done to death and he would respond, “No, no one has really nailed it.” For many reasons, the concept of accounting software “didn’t match the vision of where I thought we could take it. I think what people are just really now understanding is that this is not about accounting software.” “We think online accounting is a temporary product category. Online accounting is the killer app for small business computing. We’ve always had a much broader view than just doing the accounting, but we’ve had to be really disciplined about building a killer accounting system first. Then over the next year or two, you’ll see us starting to do the things that we really want to do”, he says.

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“When I’m talking to accounting firms in New Zealand or talking to the accounting partners, I’m asking ‘Do you guys have export goals? Are you thinking about 30% of your fee coming from offshore over the next 2 years?’ That floors them; and they look at me like ‘What are you, some sort of mad man?’ But then, after a few minutes, they start to realise that the difference in labour rates between New Zealand and Australia is about 40%, so why can’t they use technology to export services? We’ve got lots of Australian partners that provide

He goes on to mention that the long demanded ‘Quotes feature’ is a good example. “We’re working on that at the moment and it’s looking really good. We also want to get inventory done this year. I think once we’ve done those and we tick the boxes of doing everything else

“For me, being an entrepreneur, having the patience to wait eight years to have the right to do the cool stuff is excruciating. Soon you’ll see a lot of stuff that we’ve been doing behind the scenes. We’re just going to move the product category over in the next few years and we’re really excited about that.”

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XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

LIKE YOUR ACCOUNTANT, BUT THEY DON’T USE XERO? YOU NEED MIDDLEMAN. We are the glue that can keep the relationship together. We help you with all things Xero, so you can use ‘Beautiful Accounting Software’, and then we provide info to your Accountant at tax time so they don’t need to learn a new accounting software product. It’s a win-win! Contact us to see how the Middleman service can benefit you, and your Accountant.

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Issue 01 / 11

Helping Businesses Get Paid On Time Our path to becoming a newly-minted Xero Add-on Partner

Words: Steven Renwick, CEO and Co-Founder of Satago

A few weeks ago I went to my first Xero event – a Roadshow held in London. I think it’s fair to say I was quite blown-away by the quality of the event. The next day, so impressed by this event, I decided to book tickets to fly from the UK to Australia for XeroCon 2014. As I prepare for my first XeroCon, it’s a good time to look back at the path that has led to my startup, Satago, becoming a newly-minted Xero Add-on Partner, and what this means for us as an early-stage startup.

Growing up with Late Payment It all started for me growing up in the Northeast of Scotland with a family business in the construction sector. As anybody with experience of the construction industry will tell you, late payment of invoices is a particularly bad problem in this sector. I vividly remember my father coming home from work, stressed, saying that yet another builder was stalling on paying for work our company had done, leading him to wonder whether we could pay next month’s mortgage. This experience left an indelible mark on me, and since then I’ve always felt this desire to try and do something to help tackle the late-payment problem for small businesses. Many years later I found myself at Oxford University, about to start an MBA, with a very entrepreneurial itch needing to be scratched. I decided to focus my studies on looking for a way to help companies to get paid faster, and the idea for Satago was born.

The original vision Today, Satago is a platform for companies to improve and automate their accounts receivable, but it didn’t start out this way. The original idea for Satago was that it would be a place where small businesses and freelancers would anonymously share data about when their business customers paid them versus agreed terms. I had looked at traditional credit reports and noticed that they were ok at telling you if a particular company could pay you, but were 12 / Issue 01

next to useless at telling you when they were likely to pay. I encountered far too many companies with perfect credit scores that I knew were terrible for late payment. It seemed to me that with the advent of cloud-based accounting software, such as Xero, it should be feasible to take eBay’s old feedback model of allowing sellers to rate buyers, and apply that to all small business transactions. They say that transparency is the best disinfectant and my vision was that if we improved payment behavior transparency we could improve payment speeds. The feedback to this idea was very positive, and Satago went on to be one of the first companies in the world to raise crowdequity funding with 60 individuals investing anything from £10 to £5000. In total, I raised £30,000 allowing me to build what’s known in the startup world as a “Minimum Viable Product” (MVP), to test the concept.

users, and from looking at the market, we could see that there was a gap for a serious platform through which companies could manage and automate their accounts receivable. It was obvious that this was the direction in which Satago should go. This was our “pivot” (see page 58).

Just email reminders? It’s understandable that at first glance some people think what we now do is “just sending a few emails”, but it’s actually surprisingly complicated. When we email a Satago user’s customer for payment, we are taking on the responsibility of representing that customer in a very precious relationship. There is no room for error and there are lots of edge cases that have to be accounted for. We take this responsibility very seriously.

Once Satago 1.0 was built we opened it in a “public-beta” so users could try it for themselves. Again, the feedback was great – with several national newspapers writing about us and invites to several prestigious startup competitions following. We very quickly gathered a couple of hundred users on the platform, but even then it was becoming clear we had a problem with the original Satago idea.

Of course Satago goes beyond ‘just email reminders’. We allow you to easily send posted payment demand letters without ever visiting a postbox or licking a stamp. Often hard-copy letters will still have more impact than email reminders. Details of all conversations with debtors can also be recorded in Satago, effectively making the platform a CRM for credit control with a full audit trail of all communication involved in your credit control.

Chicken & Egg

Getting on the phone

Nearly everybody believed in our vision for Satago and could see the value this datasharing model could bring. However, the fact was that it would take us a very long time to build up a sufficient critical mass of data that would actually make the service useful. Put another way, we faced a classic “chicken & egg” scenario: the service would only be useful if we had lots of data, but the only incentive for people to share their data was if there was already lots of data there. Satago’s problem was that it was not useful from Day 1.

Effective credit control is about good communication, and that eventually means getting on the phone to customers to ask for payment. Our own research has found that a surprisingly large number of small businesses are reluctant to do this, due to the feeling that they are ‘annoying’ their customers. Of course this is not the case, but perhaps the feeling is understandable. To help Satago’s users with this ‘shyness’, we will soon be adding the ability to escalate debts to experienced credit managers who will get on the phone to users’ customers on their behalf to ask for payment, with all

Through conversations with our earliest

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

details of conversations being recorded in Satago. Of course this is equally attractive to companies that just want to completely out-source their credit control so that the finance team can concentrate on other areas.

What if Xero builds this? We recently raised a fairly sizeable seedinvestment round from a number of notable European investors to allow us to take Satago to the next level. One of the clichéd questions that any entrepreneur will hear when they’re raising money is, “what if Google build this?”. In our case the question was more like “what if Xero build this?*”. It’s a fair question, and you only have to look at those companies that were built purely dependent on integrating with Twitter to see what happens when a company decides to copy its integration partners. The counter-argument to this is perhaps the smartphone “app ecosystem”, the strength of which made Apple’s iPhone so much more than ‘just a phone’ and allowed them to quickly overtake Nokia’s mobile phone dominance.

Do one thing and do it well From my early interactions with Xero I get the feeling that the company really values the ecosystem that it is building through its Add-on partners. In other words, Xero is more like an Apple trying to overtake the old-guard rather than a Twitter that would devour the ecosystem that makes it so strong in the first place. It’s difficult enough to build a worldclass accounting software platform, and I believe that building a world-class accounts receivable platform is an equally ambitious mission. Companies tend to succeed when they do one thing exceptionally well and that will be our strength – concentrating 100% on building the best-in-class accounts receivable platform and helping small businesses Get Paid On Time. *It’s probably worth saying that Xero might be flattered that investors consider them the “Google of the accounting software world”.

Words: Alexander Kohl, Founder, Jet Convert

Getting The Most Out Of Xero - Your First Steps

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Xero is a powerful tool for introducing more efficiency into your business. Achieving it is a matter of getting some simple things right at the start. Following your data conversion into Xero, we recommend you work through the following checklist with your accountant or bookkeeper: 1. Systemise for managing the business: ■■ Decide on a business process to maximise the benefit of bankfeeds - how to get bills in. ■■ Review the dashboard and accounts watchlist - get focused on what is important. ■■ Review the Chart of Accounts for useful reporting. ■■ Invite users with the correct access rights, including your accountant or business adviser. ■■ Review the Management Report and make it a monthly habit.

3. Prepare for efficient bank reconciliation ■■ Activate bankfeeds as soon as possible - these can take up to two weeks to get started. ■■ Enter bank details for ABA file creation so you can automate payments. ■■ Close the bank feed gap by uploading missing transactions - use historical bank statement .csv or .ofx files or, if needed, use our PDF to CSV conversion service. ■■ Check bank balances - use the Xero bank reconciliation report compared to actual bank statements as at MYOB last reconciled date. ■■ Set up bank rules where appropriate.

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2. Adjust Xero to reflect your brand: ■■ Customise invoice branding, set the next invoice number, set the standard due dates and add a payment gateway as appropriate - this could be Paypal or another credit card portal. ■■ Customise email settings to speak in your tone. ■■ Upload your company logo to payslip.

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4. Clean up the books: ■■ Decide whether to write-off any old unpaid invoices and bills. ■■ Review future dated invoices and bills these should be addressed if no longer valid. ■■ Review employee, bank account and superannuation information - make sure everything is up-to-date. Upon completing this checklist you are ready to start using your new Xero accounting software to save time, streamline processes and improve business performance.

Issue 01 / 13

14 / Issue 01

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

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Issue 01 / 15

Industrial and professional service organisations use TidyWork as their job costing workflow system to manage time, materials and expenses efficiently.

USED BY:

“



Architects



Civil Construction



Designers & Digital Agencies



Commercial Construction



Consulting Engineers



Engineers



Chartered Surveyors



Field Operators & Installers



IT Professionals



Manufacturers & Fabricators



Research Professionals



Workshops

Having a much more powerful project management system that linked with Xero was, in the end, the major reason for going with Xero. Gillian Walker, Business Manager, Crouch Waterfall | Godalming & Bristol, U.K.

Integrates with...

”

Stock

BUY. STORE. SELL.

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16 / Issue 01

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

PRODUCT OF SILICON AVENUE

ACCOUNTANTS –

the trusted advisor to business? The shift to cloud accounting, led by Xero, has changed and improved how many businesses work. But for the accountancy profession, it has heralded revolutionary changes. As with any upheaval, the changes have not been universally welcomed. But most accountants recognise the benefits that cloud accounting delivers for them and their clients. Chief amongst those benefits would be the single ledger. Put in layman’s terms, cloud accounting allows the accountant and client to work from the same set of current financial information. In the past, the accountant was bound by what was supplied by their client. This was always out of date and often incorrect. The single ledger changes the accountant’s role from ‘reporter on historical data’ to ‘an advisor with their finger on the pulse of the business’. And because Xero saves hours of time previously spent on admin jobs like bank reconciliation, accountants can offer advice without charging clients more. Or at least, that’s the theory. There is no doubt that business owners want advice. “Most small business owners manage everything in their business”, says Glen Senior from The Small Business Company, a firm that works with banks internationally on small business engagement strategies, including Bank of America. “They don’t really need advice on what to do in their industry, as they can talk to their industry peers. But they don’t always have someone they want to talk to about their business aspirations, goals, struggles and issues.” But are accountants the right people to give that advice? Business owners think so – a survey in 2013 asked the owners of 1,018 Australian SMEs to name their most trusted advisor. Their accountant was the number one answer. The same survey asked business owners their opinions on why SMEs fail. Reasons given included failing to manage costs and the books, plus poor business planning. Over a quarter felt that not seeking

Words: Matt Wilkinson, CEO and Founder of BizInk. BizInk is a Xero Modern Practice Partner and specialises in websites and online marketing for accountants in Australia, New Zealand and the UK. bizinkonline.com matt@bizinkonline.com @bizinkonline

professional advice was key to business failure. So not only do business owners want advice, they need it. And given that many businesses fail in their early stages, the accountant has a pivotal role to support businesses and, in turn, the economy. Many accountants want to be advisors, but by the time business owners ask for help, it’s usually too late. Xero and the single ledger should change that situation but the books don’t tell the whole story. Often business owners don’t contact their professional advisors for fear of racking up bills. So what’s the answer? We talked to three leading accountants in Australia, New Zealand and the UK. All three are using modern and innovative ways to reach clients and help business owners. Interactive Accounting is amongst the most innovative accountancy firms. They have offices in Sydney and Melbourne but clients across Australia. A quick look at their website shows they are not your average accountants. Recognised by Xero in 2013 with a Marketing Innovation Award, they also won Xero Website of the Year in 2012 and Xero Partner of the Year in 2011, which suggests they must be doing something right. Guy Pearson is CEO of Practice Ignition, a cloud software company that streamlines how accountants work with their clients. He founded Interactive Accounting in 2010 and still sits on their board. I asked Guy

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what Interactive Accounting was doing that set them apart. At a basic level the firm is business growth, not compliance focused. As Guy says, “tax is important, but building a successful business is more important”. Plenty of firms take that approach but it’s how Interactive Accounting deliver advice that’s innovative. Their approach to doing business is more akin to a tech start-up than an accountancy practice. ‘Technology is imperative as a medium for information and communication’, in Guy’s opinion. Where most accounting firms could only count on phone and email as communication channels, the Interactive Accounting team use a range of modern tools. Client meetings might be over Skype or Google Hangouts. There’s a live chat function on the website and support is handled by cloud based ZenDesk. These interactive tools are backed up with indepth content delivered through the firm’s website and distributed using social media. Videos have proved especially popular with clients as they are easy to consume. Another accountant combining technology with business advice is Brad Golchin, managing director of Wise Advice from Auckland, New Zealand. Wise Advice is a Xero Platinum Partner which means the firm has over 500 clients using Xero. I asked Brad how he’d achieved that level of success. Like Guy Pearson, he says accountants have to move beyond compliance. “You can’t

Issue 01 / 17

just concentrate on tax. You have to help the client increase their profitability and one way to do that, perhaps the most important, is through technology.” As well as supporting clients on Xero, Brad and his team advise on the whole eco-system. For a trade client, he might recommend Geo-Op, for a retail client, Vend. It’s all about understanding niche industries and the specialist software created for them. The efficiencies created by technology can directly impact a business’s bottom line. Being an expert in technology gives Wise Advice a competitive advantage over other accountancy firms: “When businesses look at Xero or cloud accounting, they want a whole system. Just helping them with accounting isn’t enough. You need to help them with their CRM, inventory, point-of-sale, ecommerce and whatever else they need to run their business. Otherwise it’s likely that someone like us who’ll help with everything will come along and the client will switch.” Brad is also an active blogger. I asked him

how he decides what to write about: “The best way to find out what content works is gathering the questions that clients ask. Business and property owners have the same problems. Create content that solves those problems and you become a valuable source of information. This helps my clients but also attracts new clients who are searching for information online”. Like Interactive Accounting, social media is an important distribution channel. Wise Advice has a presence on Twitter, LinkedIn, Google+ and Facebook which Brad says are essential for getting his message out: “The blog is great but on its own won’t attract many visitors. It would be like printing a newspaper but not putting it on newsstands. You have to share it on social media if you want people to come and read it”.

often. LinkedIn has been especially useful. Craig manages a LinkedIn group called the Fife Business Network which has over 1500 members who he communicates with weekly. He also shares content with his contacts and various other groups. He’s able to reach thousands of people every week. What the stories of these accountants show is that online media suits the modern business world. Business people are connected 24/7 and are as likely to be looking for advice at 11pm on their iPhone as they are to call their accountant. Firms who don’t service that demand will get left behind.

Glen Senior has found the banking industry has Alexander got the message aboutJet creating Words: Kohl, Founder, Convertcontent For Wise Advice and Interactive Accounting, for business owners. “We see an increasing Xero paved the way for them to become trend where banks are adding practical advisors instead of bean counters. But small business management content, cloud accounting is still in its infancy. especially business planning, into their websites for anyone to download and use Guy Pearson says that New Zealand for free. It sets them up as an opinion and Australia leads the world in cloud leader. But accountants are more likely accounting. He estimates 20% of New to be asked a question before the bank Zealand businesses are using cloud manager. So, in my view, accountants are 3. Prepare for efficient bank reconciliation software to do their books. In his native lagging behind in adding useful pieces of ■■ Activate bankfeeds as soon as possible Australia, he thinks it’s more like 10%. content to their websites to engage and - these can take up to two weeks to get That percentage is even lower in the UK drive traffic.” started. where Xero doesn’t have the same market ■■ Enter bank details for ABA file creation penetration. As founder of BizInk, a company that helps so you can automate payments. accountants succeed online, I work with ■■ Close the bank feed gap by uploading But there are still plenty of accounting a lot of firms on their websites and digital missing transactions - use historical firms combining technology, advice and marketing. The most successful firms I see bank statement .csv or .ofx files or, if modern marketing to help UK businesses. are those who create regular and relevant needed, use our PDF to CSV conversion Firms like Edinburgh-based CNJ Accounting content for their audience. service. Solutions. Run by Craig McKie, CNJ is one ■■ Check bank balances - use the Xero of five Xero Gold Partners in Scotland. Xero It’s good marketing sense to show rather bank reconciliation report compared to gave him the platform to help clients in a than tell. So instead of telling people actual bank statements as at MYOB last way that hadn’t been possible before. “With about their business planning skills, smart reconciled date. cloud accounting, we can focus on what firms demonstrate them with engaging ■■ Set up bank rules where appropriate. the numbers mean, rather than what the content. That might be via a blog, video or numbers are.” infographic. The form isn’t as important as 4. Clean up the books: creating content and then promoting. As ■■ Decide whether to write-off any old While he’s always been a business advisor a rule of thumb, we recommend spending unpaid invoices and bills. as well as an accountant to his clients, 20% of time creating the content and 80% ■■ Review future dated invoices and bills cloud accounting has given him the promoting it. these should be addressed if no longer platform to offer more timely advice. Bank valid. feeds are the ‘killer app’ in Xero for him as The benefits to an accounting firm include ■■ Review employee, bank account and business owners keep their accounts up to improved search engine ranking, happier superannuation information - make sure date, instead of keeping a box of receipts clients and more leads. And altruistically, everything is up-to-date. until the end of the year. who wouldn’t want to be a force for good in the business community? As the CCH Upon completing this checklist you He’s not just an advisor to clients and is Survey showed, business owners are are ready to start using your new Xero happy to share his knowledge with the local hungry for advice. Their accountant is their accounting software to save time, business community. Traditionally, that was most trusted advisor, so who better to streamline processes and improve business through events, but social media allows him deliver that advice? performance. to communicate with more people more

Getting The Most Out Of Xero - Your First Steps

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18 / Issue 01

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

Customer Feedback: How to Get Rich by Not Doing it Wrong customer-focused, and which directly improves bottom line profit as a result.

Words: Guy Letts of CustomerSure

In view of how badly it’s modelled by large companies (who really should know better), it’s understandable that people in business might be reluctant to set up customer feedback in their own business. Last month, I received a 59-page survey from a hotel chain (I took screenshots). Who wants to inflict that on their customers?

Guy is the founder and managing director of CustomerSure, an online platform that makes it easy for you to collect feedback and address the needs of each individual customer. Before founding CustomerSure, Guy was Head of Services at Sage where he used his experience to transform 10% attrition into 20% growth. Alongside 14 years at Sage his CV includes British Airways and Logica.

The smart way to do feedback is in a way that is designed to benefit customers. And the way to benefit customers is to help them get what they want as quickly and simply as possible.

About CustomerSure CustomerSure’s Xero Add-on makes it easy for you to collect feedback and address the needs of each individual customer. Increase customer retention and improve your revenue by making sure every one of your customers is satisfied.

“Sign me up, don’t bother with the trial period,” demanded the voice on the other end of the phone.

The answer is that each time you deliver a product or service to a customer, you just ask whether they’re happy with how things have gone. And you ask at a time, and in a way, that makes it easy for them to tell you. Then you either get peace of mind that their custom is secure, or you have the chance to fix any problems promptly. Typically, this means asking within 24 hours, and in a low key way – in person, by telephone or using an online feedback form.

It turned out that she had just lost her largest customer and she hadn’t seen it coming. She wanted a customer feedback system up and running immediately to make sure it never happened again.

The secret to getting rich by doing customer feedback well is by treating each customer as an individual, rather than assuming that you can draw conclusions about your customer base as a whole. Because that’s not how you won them in the first place – you won them one by one, according to their personal needs and circumstances. It turns out that’s the best way to keep them too.

This goes to the heart of how customer feedback should be done.

Doing it this way, customer by customer, unlocks all these benefits:

Traditionally of course, a customer survey is done once-per-year as a rather woolly research exercise, the results of which often aren’t even read by anyone. And how often does each customer feel his or her voice has been heard, let alone actioned?

Now, a sale is a sale, and we treasure each one as much as anyone else. But the urgency intrigued me so I had to know the story first...

But in contrast, feedback that’s done as a natural part of ‘business as usual’ can be a much sharper exercise that is refreshingly We want to hear from you! Get in touch - email: hello@xumagazine.com

Referrals - Be confident there are no frustrations preventing a customer putting their personal reputation on the line for you. 2. Repeat business - Have customers welcoming offers and promotions, not binning them. 3. Loyalty - Never underestimate the value of having an emotional connection with your

Issue 01 / 19

10.

Let’s examine the numbers:

)

It has a surprisingly big impact on revenue.

73%

16%

11%

We took a large, anonymous sample of 100,000 responses from our database of satisfaction scores to work out how much business is at risk. We found that 27% of people were dissatisfied in some way. Which means 27% of customers had a reason NOT to buy again, and they’re not likely to pass on a recommendation to others, either.

their problems too.

How to increase sales the hard way:

So the good news is that customers WANT to be able to recommend you.

There’s a steady run rate of sales, but each

Sales

sales revenue?

Marketing

Total Sales

Sales lost when customers don’t return

This year

Repeat Business

How to increase sales the easy way: This chart illustrates the dramatic financial Sales gained from finding & fixing customer frustrations

}

Referrals Saved Marketing

Total Sales

This year

But we HATE things that cause us anxiety, uncertainty, hassle and cost us time. And we will NEVER recommend anything that’s not been pretty much 100% reliable for us, because we don’t want to be responsible for our friends having problems. If you’re one of the good guys, people will reward you with their cash, their personal endorsements and their loyalty.

Next year

year some customers slip quietly away. You may not even notice they’ve gone because you’re so busy trying to bring new customers on board.

Sales

customers. It’s what makes the great brands so profitable. Retention - Never have that feeling in the pit of your stomach when you find a customer has gone to a competitor. Customer acquisition - Publishing feedback on your website gives new prospects the confidence to buy. Competitive advantage - Independent reviews are a trump card for winning competitive bids because the customer will not feel like they’re taking a risk if they choose you. Reputation - Get your retaliation in first. By asking for feedback and fixing any problems, by the time a customer tells their friends, you will have had the chance to shine. Sales opportunities - No customer is happier than the one you have just turned round brilliantly. Slip in a quick special offer at the right time and get much more business rather than no more business. Morale and motivation - Every compliment makes someone in the business feel like a hero. Education - Verbatim comments from customers leave you no place to hide. It can feel raw, but what doesn’t kill you makes you stronger.

Repeat Business

Next year

benefit that can be gained from some simple measures to improve customer satisfaction, which you can only do by asking for feedback. Now you’ve solved the revenue leaks: ■■ There are no more avoidable lost customers ■■ Existing customers have no hesitation to recommend you because you’ve dealt brilliantly with any frustrations. In fact, the improved service means they’re positively raving about you.

But sadly, doing your best, or having a ‘commitment to service’ isn’t enough. It takes more than good intentions, because sometimes, despite those best efforts, you can miss what’s most important to your customer. Something could go wrong that you’re not aware of – such as a colleague who failed to pass on a message or return a call, or you just might not know that you keep missing the mark. And your customer doesn’t like starting an awkward conversation, so you’ll be working your socks off, and yet still falling short. Worst case, you’ll only find out when they vote with their feet, by which time it’s too late to save them (even though they might have wanted to be saved). To become more ‘recommendable’ you have to know why it’s not happening now.

3 key principles for a successful customer feedback system Customer feedback can deliver quick wins and lasting benefits, but even when you’ve decided to commit to achieving those benefits, there are some principles to follow and some bear traps you’ll need to avoid.

1. Focus on business benefits ■■

You’re not just doing this because customer satisfaction is a good thing; you’re also doing it because it’s the key to growing revenue, profit and morale. If business goals are not central, nobody will do the things that unlock the benefits. You’ll start with good intentions, but unless everyone’s convinced there are substantial long term benefits, then at the first panic elsewhere in the business (and it’s often about short term sales) this project will fall by the wayside and the rewards will be lost. It needs to be supported,

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Worse, they may even be telling others to steer clear.

So 27% of sales are at risk in companies that regard themselves as ‘good’ at customer service. Unless, of course, you simply make sure you find and fix any problems to counter the frustrations and unlock those sales and recommendations. Why does this have such a big impact on

Using customer feedback to measure and improve

As customers, don’t we LOVE to have things we can depend on? Life’s tough enough, so when we find something that takes away problems rather than creating them, or when we find products or services that ‘just work’, then we stick with them. And we’re happy to recommend them to others because we like to help our friends solve

■■

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20 / Issue 01

■■

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

communicated, measured and celebrated as much as any other initiative that’s important to the long term success of the business. Linking it in everyone’s minds to business benefits gives it the profile it needs.

2. Make it easy for customers to have their say ■■

■■

Customers need to contact you for all sorts of reasons. Make it easy for them to access the best person for their particular problem and they will thank you for allowing them to get their issue resolved quickly. Don’t assume that everything’s OK just because you’ve done your best; sometimes it won’t be. Check for satisfaction when you’ve delivered a product or service. You will be amazed (and often delighted) by the surprising things you learn Satisfaction checks (or surveys) should be designed with the customer in mind: short, fast, relevant, and sent at a time that’s appropriate to them. Maximum five questions; maximum one page. Send a survey straight after you’ve done something significant for a customer. Choose the time when it would be most appropriate from their point of view. Make it easy to give unsolicited feedback. It will happen much less often, but usually when it’s more urgent. The easier you make it for a customer to contact the best person to deal with their issue, the happier they will be.

3. Act on customer feedback. Immediately. Every time. ■■

■■

■■ ■■ ■■

■■

Be prepared. It’s great to have our say, and terrific when someone makes it easy for us. But what a disappointment when there’s no response (or at best an automated one) and we feel like we’ve been completely ignored, despite investing time and effort giving considered feedback. Don’t analyse it (yet). Act on it. You can analyse and look for as many insights as you like, and prepare PowerPoint slides and charts to your heart’s content – later on. The customer doesn’t benefit from your insights, they benefit from your actions. Because you have made it easy, and because you have indicated that you care, you will get replies… If it’s praise, celebrate it with your team and make sure you’re displaying reviews to attract customers. If there’s a problem, fix it. Twice. First solve the problem for the customer, and then fix the underlying cause so it doesn’t happen again. Respond appropriately. Praise does not always need a reply, a problem does. Use your judgement on what the customer might expect or appreciate. The test for most actions is: “What will make this particular person most likely to recommend us to their friends and colleagues?”

Providing you act on feedback, satisfaction will go up, spending will go up, and personal recommendations will multiply your customer base.

Do it Right Follow this simple advice, and by the simple truth that most companies do it wrong, you’ll stand out from the crowd and become known for your incredible dedication to We want to hear from you! Get in touch - email: hello@xumagazine.com

Issue 01 / 21

customers.

I have found that every business I encounter in the Xero community, like Xero themselves, is forward thinking, innovative and willing to break the mould to do things better for their business. We like to share the experience we’ve gained at CustomerSure to help people take as enlightened an approach to taking care of their customers as they have to taking care of their finances.

2. 3.

For more information, visit: www.customersure.com/xero

Exclusive offer for XU Magazine readers!

Claim your FREE one-to-one Customer Service consultation and demonstration with Guy Letts. Email: guy.letts@customersure.com for more details. Hurry, offer ends 31st October 2014.

Don’t send 10 page annual satisfaction surveys (make surveys 2-3 questions long, and single page, and send them after you’ve delivered something meaningful) Don’t pester people to respond Don’t send out surveys until you have geared up to act on what comes in (review every response immediately and be prepared to act immediately if necessary) Don’t just use the results for ‘management information’ or ‘insights’ or ‘strategy’ (you should do those things, for sure, but only once you’ve dealt with any immediate issues) Never let a customer fill in a satisfaction survey and be left with absolutely no confidence that anything will happen as a result (this should be obvious, but it’s the most common mistake because usually NOTHING DOES HAPPEN)

Common

Mistakes

to Avoid

6. Don’t outsource satisfaction surveys to a market research company (nothing against market research companies, they do a fine job, but customer feedback is not the same as market research and I have NEVER seen any of them do a fine job at this – the goal is to MAKE customers satisfied and measuring does not do that. See #1) 7. Don’t average or benchmark the scores (it’s the comments that are important, the scores are just a temperature check) 8. Don’t say your survey is ‘short’ unless it can de done in less than 30 seconds 9. Don’t send a satisfaction survey that takes longer than 30 seconds to complete 10. Don’t ask questions about anything that wouldn’t be important to a customer

www.accountinganywhere.com/xero

We are global Xero training specialists! Accounting AnyWhere and Xero... the perfect team to help move your business to the cloud

Based in Canada: ■■ New to Xero or on desktop and ready for the Cloud? We can help convert your books to Xero. ■■ No time for bookkeeping? Leave it to us. Located outside of Canada: ■■ Accounting AnyWhere offers global training on Xero.

Contact us to discuss training or to help you get started with Xero Email: contactus@accountinganywhere.com Skype: AccountingAnyWhere

22 / Issue 01

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

Quick and Dirty Xero Tips

Words: Heather Smith

Logging into Xero each day is a few seconds too many wasted. To alleviate the process you could; access Xero via ‘login.xero.com’ (but you still have to enter user name and password). Better still, save ‘login.xero. com?username=[Xeroemailaddress]’ as a bookmark to your browser, and you only have to enter the password. The ultimate UberGeek one-click solution is to use a password management tool like LastPass, Roboform, or KeePass to store passwords and quickly log into Xero. A password manager takes 5 minutes to set-up and a further 10 minutes to customise to your needs. As well as relieving the first world problem of the few seconds it takes to login into Xero, it saves you time by organising all of your passwords in one place, and offers the additional feature of generating ridiculously secure passwords, freeing the grey matter up for other things! Personally, I use LastPass Premium, with an annual subscription of only $12 a year.

TIP

The benefit of working with a cloud based solution like Xero, is you can have Xero open across multiple tabs, allowing you to quickly refer to different areas. To open an additional tab, right click on the initial tab, and choose the DUPLICATE option from the drop down menu. In the new tab, you can navigate to another area of Xero. For example, you may have the Bank Reconciliation open on one screen, the Sales Dashboard on the other screen, and the Contacts area open too.

TIP

If a change is made in one area of Xero, you need to REFRESH or RELOAD the screen you’re looking at to ensure you are viewing the latest information.

TIP

If you want to tell someone exactly where they should look in Xero, a neat trick is to simple share the hyperlink of the actual screen. Copy and send them the browser link, tell them to log into the appropriate Xero file, and then click on the link. They can then drill through to the exact detailed information you were sharing with them.

TIP

Debtograph shows you who owes you!

Words: Jonathan Clarke of Debtograph

We knew there were debtor tracking add-ons out there, so we did two things differently. First, Debtograph is all about big clear graphics, there’s not a boring Aged Debtors report anywhere. Second, we decided to give it away for free. We wanted to learn about Xero users and make a few friends, so a free add-on was the way to go. At a glance, you can see how much your four biggest debtors owe. Which of the big debtors pay slowly, which pay quickly. Which customers are spending more. There’s even a stress-relieving game where you see how to improve your Days Sales Outstanding (DSO) by chasing the oldest invoices. Immediately people “got” the idea, whether they thought it was for them or not. It’s free, quick and easy. During our ten minute presentation at Xerocon Auckland this year, an accountant went straight ahead and logged on. “I just tried it, it’s really cool”, she said.

chasing whilst the client is on the phone. That’s the idea which has really taken off - a way of getting debtor data to the parts that Xero cannot reach. Debtograph will stay free. Our business plan is to launch higher value Add-ons. We’ve started with Financiery (www.financiery.com) which makes signing up for alternative types of finance a smooth and pleasant process. That’s live in New Zealand, with the UK and Australia being our next target markets. Try out the Debtograph sample data and decide if you like it. It’s not for everyone - some people like to pore over pages of figures. But if you like it, you’ll really like it. It’s “a living breathing thing to be cherished on a regular basis”, as a user said to us the other day. For more information, why not visit: www.debtograph.com

The new ideas for the system are now coming from our customers. In England, they want to compare now with 30 days ago. In Romania, they’d like to pick up on the amount overdue as well as the total owed. In Australia, they want to share data with the sales team, who are not Xero users but can do some debt

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Issue 01 / 23

A one man operation blazing a trail in the Xero Add-on ecosystem Words: Heather Smith

While holding down a full time job, Ruairi McCarron founded Quick Win Developments (QWD) with the ethos of achieving “quick wins” – taking complicated processes or workflows and simplifying them. Launched in July 2013, the hobby business’ first two products, Outlook and Excel add-ons, were officially approved as part of the Xero ecosystem and brought to the market two months later. The evolution of McCarron’s one man business has been challenged by both time and resources: “Every bit of code, every web page, every newsletter and email is done by me – in my spare time. I work full-time for a large software company that is really supportive, and I have a young family”.

“The QWD Excel Integration Tool allows us to customise reports to our client’s specific needs. Reports can maintain links to Xero which can be refreshed as required. It makes the reporting process in Xero effortless and seamless, and allows us to provide accurate, timely and well-presented custom reports to clients.” Tanya Titman, Consolid8, Brisbane. Source: Xero community reviews

24 / Issue 01

To counter these challenges, McCarron has adeptly engaged the community in the development roadmap of QWD products: “Some of the best features of my software are the product of back and forth discussions with the user base. For me, the ideal customer is someone who is willing to join the discussion, bat around some ideas and help define and refine enhancements and feature requests.” So how does McCarron start a company and maintain a high quality of service without impacting his career and family life? He devised a special combination of methodologies, patterns and practices which boils down to “having good processes in place”. This results in a fast turnaround for updates and features. “Whilst evaluating the product, I raised a few questions and (suggested) enhancements... within hours, the enhancements were implemented into the live product.” — Jonathan Gaunt, FD Works, Bristol. Source: Xero community reviews At the time of writing, QWD’s Excel Add-on is the highest user-rated reporting Addon in the Xero Community Forums. Up against established competition with deep wallets and big development teams, this

Ruairi McCarron, Founder of Quick Win Developments (QWD)

is a significant achievement for the small guy! McCorran believes good old-fashioned customer service and affordable quality products have led to this community recognition. Products: • Outlook and Excel McCarron also attributes his success to Integration Tools the nature of emerging technologies: “I (see main website) suppose in my line of work we get a lot of • Back-up Solution fads and new technology buzzwords. Most (ledgerbackup.com) recently our ears have been bombarded with cloud-this and cloud-that. The real winners of cloud technology are start-ups and small businesses. People may have their grumblings about Microsoft, but the fact is, they have a lot of visionaries and they recognise and facilitate this opportunity for small businesses with not only their Azure platform, but also their catalogue of online services and their programs for small businesses, like BizSpark.” McCarron sees this trend continuing and is optimistic about the future viability of this type of business structure: “Small startups like mine now have low cost access to technology that was once reserved for only the biggest of IT budgets; this is a game changer. I think we’re in for a radical boost in technology over the coming years as we start to leverage off the robust, scalable and affordable systems PaaS (Platform as a Service) can offer.” Reflecting on the last 12 months, McCarron has this advice for other start-ups: “Pace yourself and regularly set both short and long term goals. Overly ambitious goals and deadlines are a quick path to failure.” For himself, McCarron sets weekly objectives and an overall yearly goal. Once the initial thrill subsides, he stays motivated by focusing on regular iterative releases enriching the features of his add-ons. Further reading: McCorran has blogged about the development of his product here: quickwindevelopment.com/blog

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Choose a software system that can grow with your business Words: Dan Fairbairn of Ocius Digital

Over the years, we’ve worked with a number of businesses to implement systems and processes that will assist them to scale – from small companies in single locations, through to organisations across multiple locations and franchises. Although the general rules are the same when looking at software and systems for different companies, things become more complex for a business with intentions to grow. In this situation, having a business software system in place that allows an expanding business to achieve higher levels of operational performance is essential from the outset. And it doesn’t just come down to cost – software with the biggest price tag won’t necessarily be the best option for your business. From data security and access to sensitive information, ownership, branding and reporting, there are many things to consider when choosing a software system for each unique business. The following questions are important considerations to discuss with clients to identify a scalable solution that will allow them to grow, manage and improve their company throughout all stages of the business lifecycle – without over-extending their budget. Choose a scalable software solution to grow with your business ■■ Will your business have different sized branches or departments? If so, does the system allow for these? ■■ If you intend to expand locations or franchise your business, will your software or system requirements force any additional costs upon new franchises or location set-ups when starting up? If so, this could create a barrier to your sales.

discontinue a software package when it’s no longer lucrative for them. With open source products this risk is lower, however it pays to research their reputation and history to prevent dealing with a vendor discontinuing updates on software you’ve just purchased and installed. Select a software solution that provides suitable security of IP ■■ As the business owner, do you have security over the information entered and stored into the software? ■■ Do you have control over removal of information by individual employees from the system? ■■ Is each company data safe from others being able to view or edit sensitive content, as well as individual content on your employees, customers, suppliers and stakeholders? For multi locations or franchising, find a solution that allows addition and removal ■■ When a franchise comes on board, how will the training for their new system be undertaken? ■■ Is there a time lag in implementing new software for a new location/franchise? If so, is this acknowledged in the contract and sales pitch? ■■ If a franchise owner decides to leave, does the master franchisor have the ability to retain access to this data and remove access from the previous franchise holder? ■■ If a franchise owner decides to leave, does their contract allow them to take information with them? If so, if this physically possible within the system, and is it uncomplicated?

software customised specifically for your company, or will you install an existing retail product? ■■ If you choose to install a retail product, is their current branding suitable for your business? If you decide to tailor software for your business, you will need to allow budget and development time to add your own branding, as well as customisations and implementations for your workflows and requirements. Establish reporting functionalities and employee access ■■ What data and reports can your employees run in their own system? ■■ Are there any security issues with this data if it is stored outside of the system? For example, would this allow the individual employees to remove information and take it away for use against your contract? ■■ As the business owner, do you have the ability to build functionality to report across all locations/departments/areas of the business for the purposes of benchmarking and business analysis? ■■ Are you willing to provide access to individual employees to allow them to compare performance against other departments or even employees, whether identified or private? McDonalds is a particularly good example of this, providing screens in store to allow each restaurant to see how much other branches in the local area have sold that day.

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Choose a software vendor with a good reputation ■■ Does your software vendor have a proven track record? Sometimes software developers

Manage ownership of data ■■ Who owns the data stored within your software system? ■■ Do you have contract codes allowing you to access data belonging to your employees? On the flip side, can your employees access information that is confidential, and if so what protections are there in place for this?

As your business evolves, it’s important to invest in software that can grow with your needs. Years ago, the options were limited – now the challenge is to filter through the hundreds of products available to find the one most suited to your organisation and where you want it to head. In fact, this can make the difference between success and failure. Contact Ocius Digital today to discuss your options.

xumagazine.com/subscribe Identify your software branding ■■ Will you engage a developer to build

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Trending Up – Shifts in Accounting Technology Words: Doug Sleeter Doug Sleeter, Founder of The Sleeter Group, is an author, thought leader, publisher, educator, entrepreneur and an evangelist in the small business accounting technology world. Visit: www.sleeter.com

If you’re like me, you’re always searching for a better way to do things. Successful people are always looking to improve, even when current systems seem to be working ok. Just like life itself, we must always strive to accomplish new things, tackle new problems, and build new successes for ourselves, our businesses, and our customers. I’ve been promoting cloud accounting technologies since 1999 when NetSuite first came out. It was called NetLedger back then. When I first saw it, it was like a bolt of lightning had hit me. Suddenly, accountants and clients could simultaneously access the same data in real time. There were so many benefits and so many cost reductions to this new technology that it seemed obvious to me that desktop software, sold on CDs through a retail stores would cease to exist within, I predicted, “a few years.” Ok, so I was wrong about the timing, but not about the direction. The bursting of the Internet bubble in 2001 really slowed us down, and in truth, the overall experience of using cloud applications was not that great in the early years. But I’m still amazed at how this obvious “better way of doing things” could lose out to old world technologies for most of the past ten years?! There were many reasons of course, but I think it was mostly about fear and resistance to change. Such is the case with us humans. We really don’t like change, especially when we don’t see anything broken about our current solutions. 26 / Issue 01

But somewhere around 2009, things really started to change. Companies like SmartVault, Zoho, Intacct, Salesforce, Bill. com, and Xero developed products that were more user friendly, and started to grow significant customer adoption, and “resisters” of cloud solutions started to lose out to “promoters.” At the same time, mobile device adoption and social media usage was exploding in ways the world has never seen before. According to Pew Research, between 2005 and 2010, the rate of social media usage jumped from 8% (of all Internet Users) to 60%! Smart Phone adoption had a similar story. According to Business Insider, Smart Phone ownership grew from 1% per capita to 22% between 2006 and 2014. This means that today, one of every five humans on the earth own a smart phone. Consider how significant those growth rates are. Compared with all of human history, these are simply unprecedented adoption rates.

What does mobile and social media have to do with accounting and small business management software? I submit that these technologies have EVERYTHING to do with how we shop, purchase, bank, socialize, and communicate. So they are fundamental to how we live, and therefore they are fundamental to how a business must operate in order to thrive in today’s world. Customers expect to do business with businesses online. They expect to be able to shop, order, pay, and get support from every business via the Internet. They want to make reservations for dinner, hail a cab, book a vacation, buy a ticket to a movie or play, download a movie for viewing at home, and record every game for their favorite sports team. These are all great examples of how we all expect cloud-based solutions to support our daily lives. So how could any business not adopt the cloud technologies?

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It makes no difference what type of business you’re in because when it comes to running any business, the goal must be to drive costs out of the operation so that you can compete in the internet, mobile, and social media obsessed world. Over the past several years, I’ve seen four simultaneously-growing trends that I believe will fundamentally change the way small business owners, bookkeepers, accountants, and even taxing agencies, will use technology in their everyday activities.

The four new trends are: Chunkification of the business process – Splitting up separate parts of the overall business management systems into discrete parts. Zero Entry – Taking advantage of connections between the chunks using the Internet moves us closer to a zero-entry world, which dramatically changes the role of the bookkeeper.

specific functionality and verticalization. This is a double-edged sword. On the one hand it’s great because we can now find the best match for each business process for each client, but on the other hand, we now have to worry more about how each of the chunks will fit together into a unified accounting system. Nevertheless, chunkification of business processes is compelling. With such broad adoption of the cloud and mobile devices, developers can now focus on deep functionality and integration that customers demand. And by focusing on smaller chunks, they can develop more profitable business models that allow them to continually improve, update, and customise their solutions to meet the evolving demands of the market. Clients gain incredible benefits from chunkification because they can pick the best match for individual parts of their accounting system instead of having to compromise with the warts in some areas of whichever product they choose.

entries that free the “bookkeeper” from entering data. Although we’ll never actually reach zero entry, the dramatic reduction of data entry from this trend is compelling, and revolutionary.

Collaborative Accounting Services Accounting Professionals also must focus on how to serve and collaborate with clients in ways that were simply impossible just a few years ago. In this new world, cloud computing provides the perfect platform for both accountants and clients to work collaboratively on the same data at the same time from anywhere in the world. By centralizing the client’s data in the cloud, surrounded by robust security measures (both physical and network security), we can provide clients with the same features and capabilities they used to get from their premise-based systems, but in addition, we can work collaboratively with clients and manage their business information.

Some examples of Chunkfication are:

Examples of products/services:

Let’s look closely at each of the trends:

■■ Shopping carts and Web stores ■■ Point of Sale software connected to back-end accounting systems ■■ Document management in a secure online vault with links to accounting transactions, CRM records, etc. ■■ Customer Relationship Management (CRM) Software ■■ Online Invoicing and Bill Payment solutions

Chunkification

Zero Entry

In the past 30 years or so, the accounting software market has been dominated by large, all-in-one accounting products such as QuickBooks, MYOB, Sage 50, 100, 300, Microsoft Dynamics, and others.

For several years, we’ve been using systems whereby customers and vendors can enter accounting data for us when they place orders on our web stores, or when they send us electronic invoices. Compared with our old world of faxes and paper documents (both sales orders and vendor invoices) in which data is manually entered by the bookkeeper, this is a significant leap ahead for efficiency, accuracy, and reduction in the cost of bookkeeping. This is the trend that is at the core of what I call “zero entry.”

■■ Hosted Desktop Software – Several companies provide desktop software “hosting” whereby Windows servers – loaded with traditional desktop software such as QuickBooks, Microsoft Office, and other business applications – can be accessed via a remote connection over the Internet. This allows accountants and clients to access the same, live data anytime, anywhere. ■■ Cloud accounting products like Intacct, QuickBooks Online, Xero, Wave, Kashoo, and others. ■■ Bill.com allows accountants to provide cash management, bill-paying and/or accounts receivable services. ■■ Online Payroll services such as Zenpayroll, Intuit Online Payroll, Surepayroll, and Payroll Relief all provide online payroll that allow accountants to prepare and manage payroll for clients.

Collaborative Accounting Services – Connecting accountants and clients to the same data facilitates a much tighter relationship between clients and their accounting firm. Mobile – Access to all information from a variety of mobile devices allows us to rethink possible, and developers are scrambling to capitalise on this new reality.

All of these products include the functions needed by small and medium sized businesses. These functions are General Ledger, AR, AP, Payroll, Inventory, and Reporting. While these products were built to solve the horizontal needs of clients by providing basic features common to all businesses, most do not provide the vertical, industry-specific customizations needed by nearly every SMB.

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The new crop of solutions, nearly all of which are online applications, are “chunkifying” those large systems into specific business processes to provide more

The key to zero entry is that it moves us away from data entry and towards connecting business processes with the accounting system via software connections and data flows. We’ll realize the goal of zero data entry by connecting customer-entered data, vendor-entered data, employeeentered data and automated recurring

Mobile

Mobile devices have become nearly ubiquitous among business owners and they allow both accountants and clients to access data from anywhere. Perhaps you’re wondering why or how mobile devices will impact the bookkeeping and accounting functions? I agree it seems like a stretch, but I believe the very fact that mobile devices are everywhere will cause everyone to rethink

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work across the board. For the bookkeeper, we’ll see apps that allow us to review and recode transactions that were “zero-entered” and just need the review step from the bookkeeper. Also, I think mobile apps for managing workflow, viewing status of client tasks, and even processing payroll will be the sweet spots. I don’t think mobile will replace our desktops for intense data work, for example, entering adjusting entries, using spreadsheets, or writing client correspondence, but the vendors will tantalize us with some very useful mobile apps to help us remain connected and productive while on the road.

Maybe, like me, this scares you. Whilst it’s easy to see the benefits of working on mobile devices, it does also bring up several possible downsides, or at least risks. First, I’m not sure we really want to have so much access to our work. It’s already causing me to feel guilty when on vacation if I don’t check email, or respond to text messages. But, I suppose that’s up to me to just turn the thing off… but still, expectations of customers, colleagues, and bosses are making that harder. Maybe the biggest issue for mobile device adoption by accountants and their SMB clients is security. If accountants can access all of their client’s data on a mobile phone or tablet, what happens if the accountant loses the mobile device? Scary for sure, so there is of course an app for that. Check out www.bikn.com. It’s a combination of a phone app and a key ring that beeps when it gets too far away from your iPhone. It’s a great example of how innovators eventually work out nearly every problem they create. The pace of change is faster than ever and success in the coming years will come for those who focus more on agility than on raw ability. Technical skills and knowledge are table stakes, but those skills won’t be enough in the new world unless you also develop the ability to use a variety of technologies to streamline your business.

Cash Is King, Cloud-style Words: Richard Francis CA, CEO - Spotlight Reporting

Here at Spotlight Reporting we’ve been helping accountants and business owners gain insight and clarity from their numbers for over 3 years now. As a Chartered Accountant, I’ve also been working with business owners to help them chart a cashflow-positive and profitable future for two decades. Whilst the technology and software scene has changed markedly over the years, the basic business precept that you need cash to survive hasn’t changed. The smarter, more successful businesses not only have a handle on their cashflow prospects, but they have also looked at potential ‘best case’ and ‘worst case’ scenarios, funding needs, and what they can do to improve their outcomes. The very smart businesses seek professional advice to get this right and to access expertise. We’re thrilled to bring “cash” back front and centre with the launch of Spotlight Forecasting v2. Our rebuilt and enhanced cashflow forecasting, budgeting and scenario tool fills a gap in the eco-system by offering 3-way forecasting, seamless online integration with Xero and EXCEL with other integrations coming - and all of the ‘cloud’ collaboration and sharing opportunities that you’d expect. Our Task Manager within Forecasting leads you sequentially down three pathways: 1.

Building, importing and/or enhancing your budget 2. Forecasting the future, including cash and balance sheet positions 3. Creating scenarios to test your assumptions and look at options

Xero data is a useful basis on which to begin your forecasting journey. Import last year actuals or an existing Xero Budget to set the foundation - or bring in a favoured EXCEL set of numbers instead. Nip and tuck as required. Getting the budget right is not only a key step before you start seriously flexing the numbers, but a critical business discipline we should all encourage. A business that has a clear budget ‘road map’ already has competitive advantage over those who don’t. In Spotlight Forecasting v2, you can create multiple scenarios from your initial budget to test various theories or ‘what if?’ business opportunities. Your chosen scenario can then be used to create a full 3-way forecast - or a simpler hybrid cashflow forecast if you want something simpler. The choice is yours. Nailing a cashflow forecast is another mark of a business that is well managed. Cash is king, and without cashflow a business will eventually die. With Xero and Spotlight Forecasting giving you clarity, you should dramatically reduce the risk of failure for your business or for client businesses. Better still, Forecasting gives you the opportunity to identify positive cashflow and ‘bottom line’ improvements - something all of us in business strive to achieve. Visit: www.spotlightforecasting.com

Those who insist on sticking to the old world processes and business models will find it very difficult to compete in the coming years. But if you’ve already embraced these new world solutions, you will experience a huge competitive advantage.

28 / Issue 01

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Words: Staff writer Photography: Igor Burbela of Venture Photography Leicester, UK

MEET CRUNCHBOARDS What better way to mark the inaugural edition of XU Magazine than by looking at a Xero Add-on that is launching at the same time as us at Xerocon Sysdney 2014. Our front cover stars, Hannah McIntyre and Amy Harris, Co-founders of CrunchBoards, had been using Xero for three years as business owners when the light bulb came on. We caught up with them to give you an exclusive XU Magazine preview of how this financial intelligence Add-on could work for you, your practice and your clients. “We love Xero. We love how beautiful it made our financial accounting... but... there was a ‘but’. We still relied on spreadsheets to get under the hood of our business despite trialling other Add-ons in this space. We built CrunchBoards to solve our needs. We approached our research and design process from the business owner’s perspective. Prior to CrunchBoards, we

had a software business which delivered granular financial snapshots for informed operational decision-making in the hospitality vertical; operational, day to day business running being key. Just like working with an external FD, we were jealous we didn’t have it for our own business”, McIntyre enthused. Hannah continued, “Xero has excellent, high-level financial reports but these focus on the accountant, not the business owner, their team or operations. All of the KPIs relevant to running our businesses (we had two at the time!) were impossible to find on-demand or effortlessly. Pre-set, high level, pretty reports didn’t cut it for us either – they weren’t the real metrics we needed. Accurate balance sheet and profit and loss cashflow forecasting further added to our headaches. We thought that, if we need an integrated approach with unlimited

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flexibility that’s quick and easy, do others?” Harris revealed the next steps: “We set about validating this original hypothesis, but 100+ interviews with businesses and accountants rapidly uncovered an even bigger need; a tool for the accountant. These interviews exposed one of their biggest challenges: supplying clients with the external FD role that they demand without crippling their profit margin or pricing themselves out of the market. CrunchBoards was born. Just like Xero, it’s a cloud platform which leverages technology to work harder for you.” CrunchBoards informed us that they tested their hypothesis again with a target to get 100 people to join a beta programme. However, in less than 8 weeks, over 700 people had signed up! Turn the page for CrunchBoards’ 101 of the Add-on everyone’s talking about…

>> Issue 01 / 29

WHAT MAKES YOU STAND OUT AS A PRACTICE? How do you market your practice? Is selling your services as easy as you’d like? How do you wow your customers so they spread the word? How regularly do you communicate with your clients? Is your own business ready for scalable growth?

EXCLUSIVE READER OFFER Quote ‘XU-LAUNCH’ for a FREE

UNLIMITED partner success programme

That’s right... completely unlimited organisations, users, alerts, boards and a co-branded marketing video when you sign up with CrunchBoards. Offer expires 30/09/14. To find out more, email: amy@crunchboards.com 30 / Issue 01

CrunchBoards works on web, tablet and phones to enable decision-making on the go.

XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at xumagazine.com

WHAT MAKES CRUNCHBOARDS THE NEXT BIG THING? Xero was step one and CrunchBoards is step two in transforming the experience a client receives from your practice. Value-added services set you apart from the competition. CrunchBoards builds ‘remarkable’ directly into your service offering. It is a tool to help you scale your business rapidly and effortlessly, making marketing and selling your value-add effortless and unquestionable. Collaboration: strategising about the future or planning a history lesson? To embrace the role that your clients want you and your practice to fill, collaboration has to be at the heart of it. Hundreds of interviews later, CrunchBoards has been developed with both of your needs at the fore. Sharing a Board creates a separate instance of it within the user’s Board control. They can manipulate, play with and get under the hood of their organisation with their copy of the Board whilst your version stays intact. Number blindness will no longer be an issue in any of your discussions with clients. With the sharing capability, they too can share Boards with you, so tailor your SLAs to include weekly or monthly touch points. The alerts system monitors all of your organisations on autopilot, alerting you of successes or causes for concern without the need to log in. With the time and efficiencies afforded to you by using CrunchBoards, resource is freed within your practice to add value where it was never possible before.

Use case: Account level calculations which have to be created in spreadsheets currently such as wage %’s, ROI calculations, break-even analysis, granular GP%s etc. etc. you cannot create in Xero. The data would have to be manually exported offline before such analysis could be performed for clients. The formula builder in CrunchBoards takes automatically synced Xero data (every 3-6 hours or real time) and updates every detailed or high level calculation required to give better visibility over your clients’ KPIs. This aids their operational decision-making and ultimately makes your practice more efficient.

Forecasting is something that you may offer to some clients as a premium service: but is the profit margin for your practice on this offering high enough when one considers the labour involved? Exploring multiple scenarios with clients such as expansion; a new pricing model; hiring a new employee; a downturn in trade etc. is difficult in practice. The options for you to deliver this in a collaborative, flexible and decisive manner are limited to clunky desktop software or spreadsheets. Both have the immediate drawback of requiring accounts data to be extracted before modeling can take place and the added frustrations of formula loss, labour intensive formula creation, an inability to share with clients due to export issues or risk of spreadsheet corruption, not to mention the data being out of date as soon as the export has occurred etc. This stops with CrunchBoards.

Use case: Create 3 different scenarios for a client exploring expansion, contraction and inertia of the business. All 3 scenarios have complete balance sheet calculations created instantly and all 3 scenarios are available for the client to manipulate. The manipulation of the data results in instant visualisation of the bank position for the client and all KPIs created for that organisation, in Cards or Boards, can be crosscompared immediately.

“When we discovered CrunchBoards we had 2,000 clients on various accountancy software packages, just over 100 of those running Xero. CrunchBoards changed the game. We are moving our entire practice to Xero to use CrunchBoards. The single ledger changed everything, this is the next monumental shift in our industry.” Will Taylor, Lucraft Hodgson Dawes

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Meet Sqrl:

The hunting and gathering app

Ever get tired of chasing down client requests? Craig Baldwin introduces Sqrl, a web application to organize, track, and efficiently manage requests for docs and information from clients. I like to start simple when introducing Sqrl for the first time. So let’s begin with the simplest version possible, how I describe Sqrl to strangers at the pub.

Words: Craig Baldwin is Co-Founder & CMO of Sqrl. Before his current adventure with Sqrl he was in large public accounting, and a co-founder of Xero partner firm, Upsourced Accounting. He fancies himself a BBQ enthusiast and purveyor of vintage of cocktails. Connect with Craig on twitter @craignbaldwin.

“Ever get tired of following up with people, you know, if you send bulleted emails asking for tons of stuff? Sqrl automates that process.” And each time, the stranger replies, “Ooooooooh I totally have that problem.” I used to be shocked, but now I nod my head up and down, in preparation for hearing their version of the ‘I hate following up for this...’ story.

Asking your client to join in your new “collaboration software” doesn’t sound entirely appealing. Yet that client would like you to do what you promised, by the deadline, and without interrupting too much of their day-to-day.

“Awesome @getsqrl demo this morning. Great UX work! ^PM” - Paul Meissner, 5 Ways Accounting Group, Melbourne Australia

How do professionals manage this process today? Primarily through emails, todo lists, portals, phone calls, and a variety of other “I hate to bother yous.” Thank goodness Xero has automatic bank feeds! In the past, us accountants were asking for way more than we do today! What makes Sqrl different is that it’s not built to serve as a collaboration platform, but rather a better communication platform – specifically for professional service workers.

I’ve heard from bankers trying to track down borrower financials, teachers trying to get permission slips signed, digital directors trying to get assets approved, and of course, accountants trying to get sales reports, payroll information, tax documents, and a million other things. It hasn’t taken long for our team at Sqrl

34 / Issue 01

to realize how common the problem of ‘efficiently gathering information from clients’ is in the professional service world. That’s because, unlike relationships that are symmetrical in nature (like co-worker to co-worker), professional and client relationships are a bit trickier.

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How do we do it? Let’s do a walk through the application and find out. First off, Sqrl organizes all of your Requests into one simple dashboard The dashboard represents all active Requests to clients (1), essentially all the things you’ve asked from others. This way, you don’t have to manually keep track of what you’ve requested on a never-ending notepad or spreadsheet. Sqrl does that for you in real-time.

scenarios when accountants forget to mark Requests “completed” if they’ve been performed offline - still sending unnecessary reminders. This is an issue we are dealing with through a more flexible client experience, which will allow receivers to close an entire Request with one click. The best client feedback has been from the ease of use and explicit nature of Requests. Sqrl is the medium for professionals and clients to always be on the same page, and both parties seem to love that.

I know what you’re thinking - what makes Sqrl better than email? Well, here are some ways we’re trying to improve on that Ready to see more? Let’s walk through the Request process experience: Requests can be created in advance and set to recur whenever and at any frequency. Sqrl comes pre-loaded with a variety of templates made by our team, and Need monthly sales reports? Just create the Request once and set it to recur each we expect to release more on a regular month, putting your sales report collection basis. If the preloaded templates don’t fit your needs, you can create your own on auto-pilot. template at any time. If the client doesn’t fulfil the entire Request, Once the Request has been sent, the Sqrl will then follow-up on the sender’s behalf, either at a default setting or one thatreceiver will get an email notification. Here is what an email notification looks the sender has customized beforehand. like to the client (2). So what do users think of the automatic Clicking “View Request Now” takes follow-up? The majority of them enjoy it because they’ve completely unloaded the clients straight to the Request (3) – no physical and mental burden of managing login, username or password. This was the collection process. Yet some avoid the done to reduce friction for end-users to automatic follow-up for fear of appearing adopt Sqrl through existing habits (i.e. portals should die). Uploaded files are bothersome to clients. immediately encrypted behind Sqrl’s Client (receiver of a Request) reaction to- secure firewall. date has been positive. There have been Once every item in the Request has

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been completed, you’ll get an email notifying you that it’s time to get to work (4).

Clicking “Go There Now” will open the completed Request. If for some reason the Request isn’t correct or needs clarification, responding becomes as simple as a conversation thread (5). Why Sqrl works: You can use Sqrl to automate the information intake for just about any situation you can think of. On-boarding, payroll, vendor management, invoices, asset Requests, etc. Sqrl’s power is only limited by the imagination of the sender with the various options for templates, Request frequencies, and reminder settings.

5 technology. Building an experience to adequately solve such a pervasive problem in professional services takes a lot of conversations, mockups, and refinements. That being said, many seem to enjoy where we’re heading with the current user experience.

Where Sqrl needs some work:

While managers loved to tell us our finagling emails to the client were ‘great client service’ we knew that great client service came in the form of timely, transparent communication that limited client interruption as much as possible. What we delivered was anything but ‘good client service’.

Why Sqrl may not work:

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We’re still a young platform: there have been challenges, snags and bugs that needed to be squashed. The system is not as flexible as we would desire, however that’s changing as each day passes and we improve on the core functionality of Sqrl.

In order to realize the full value proposition of “digital hunter & gatherer,” Sqrl will need to integrate with a variety of source systems and cloud storage providers. For the time being, Sqrl is still a stand-alone application, meaning that there’s still some manual work involved. However, integrations are on the roadmap.

Using Sqrl requires dedication to the system by the sender, and a very small form of adoption by the receiver. You’re not only introducing a new piece of technology, but a new (albeit simple) process. We’ve found that while many people are looking for change, not all are ready for it, no matter the benefit.

Over the last 6 months, we’ve learned that the value proposition of Sqrl lives best with those businesses and firms sending high volumes of Requests, either to one contact or the same Request to a large number of contacts. The most popular use case for Sqrl has been on-boarding – something we’ve seen repeated across business verticals. So, if you’re a growth oriented firm, looking to drive efficiencies at your practice, we’d invite you to check Sqrl out (getsqrl.com).

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Some UX/UI Enhancement: the problem being solved by Sqrl is largely a UX/UI one, not necessarily one requiring fancy

36 / Issue 01

Conclusion:

We originally created Sqrl because we found ourselves spending 20-25% of the week at our own Xero-partner firm gathering the items we needed from clients. It was a problem that plagued us all the way back to our days in large public accounting.

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Issue 01 / 37

Meet Quotient:

The incredibly simple quoting system

XU Magazine spoke to Nathan Carter and Dale Vink, Co-founders of Quotient; a simple web based quoting system, suitable for small to medium sized businesses across a wide range of industries. It was quietly launched out of “The Tron” (Hamilton, New Zealand) in December 2011 and soon after became integrated with Xero. Quotient is self funded and has grown organically at a respectable pace. Vink says “Money was never an issue. For the first seven months everyone was on an unlimited free trial. Although this wasn’t a marketing tactic, it was simply because we hadn’t built our automated billing system yet and this wasn’t a feature customers were crying out for.” Money is even less of an issue now, in the last 12 months their monthly revenue has increased 198%. This is what they told us...

Words: Nathan Carter of Quotient Quotient Co-Founders Dale Vink (L) and Nathan Carter (R), both aged 36, have been in the web industry since before dial-up internet was a “thing”. They started out with their web design studio (Black Sheep) back in 2003, which exposed them to the need for decent systems amongst small teams, just like theirs. So a few years ago they set about building ‘the best quoting system in the world’. They’re on a neverending quest for perfection and fuss over the tiniest of details, yet they do what they do because they love nothing more than hearing about how much Quotient is helping people in their businesses every day.

38 / Issue 01

Many businesses, need to produce quotes for their products and services, it’s so important, yet there are many sticking points. Methods of delivering quotes are wide and varied. Some are just verbal, others handwritten. Some still send faxes, others slap a few figures together in an email message. And then there are those who send big bloated email attachments, often as Word or Excel documents, requiring the correct software in order to view.

acceptance of a willing customer quickly.

Quoting is difficult. Sometimes even getting a quote out of a business can be difficult, like drawing blood from a stone. But quoting need not be difficult.

So how does Quotient work from a customer perspective?

We see quotes as the lifeblood for many businesses. They need to be presented professionally, on time (or sooner) and have a clear opportunity to capture the

In our past experience of doing client service work it was always easier to negotiate the price or the terms of a project at the early quote stage rather than at the invoice stage, after the work has been completed. And that’s essentially why we created Quotient.

They first receive an email, with a link to view the quote. No special software is required, the quote simply opens in a plain old web browser. A typical quote is made up of line items

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created in Xero automatically from accepted quotes. With this, all relevant details are included on the invoice: accepted line items, quantities, prices, account codes, the customer acceptance order/reference number and their contact information. There’s also a permanent link back to the quote for easy reference. From within Quotient you can also ‘lookup’ your Xero contacts when creating new quotes and you can ‘look-up’ your Xero inventory items when adding line items to a quote. The dashboard is the go-to screen in Quotient, where you can quickly search all previous quotes and easily access quotes still in draft, recently accepted and recently sent. Messages will appear on the dashboard for unanswered questions and for private notes – which have been

containing the usual title, descriptions and prices – these can also contain document attachments and images which are automatically optimised and arranged into a nice gallery set.

for your customer and giving them assurance that you have everything under control.

Additionally, a line item can be set as a ‘recommended option’ which is selected (and the customer can deselect it) or as an ‘optional extra’ which is not selected (and the customer can select it). The quote total automatically recalculates when a customer selects or deselects optional items as part of the quote acceptance.

Ask anyone in business and you’ll typically hear that quoting is time consuming, hard work and it’s usually in an unorganised outof-control state.

You can also incorporate text based note items into your quote, for things like terms and conditions, sales blurbs and additional info about your product or service that will help to clinch the deal. Customers can ask questions and post comments directly onto the quote. Your answers and comments live on as part of the quote in the discussion section. With this, instant email notifications are sent to ensure everybody is kept in the loop.

And from a quote author perspective...

With Quotient however, it’s a breeze. You start from the new quote button on your dashboard (to really speed things up you can select one of your predefined quote templates to start your quote from). Choose who you wish to send it to, or create a new contact on the fly. ‘Look-up’ and add some more line items and alter the prices if needs be. Save and preview the quote, confirm or tweak the email message that’ll be sent out… the quote is sent, you’re done! If you check back a little while later, you can see how many times the quote has been opened and when it was last viewed. This is great as it allows you to gauge the optimal time to follow up with the customer.

Customer Opinion: “We have been using Quotient since February 2013 and love it. It not only produces professional quotes that makes you stand out, but it makes the acceptance process easy. Getting signatures on confirmed quotes is a painful process, but Quotient makes it simple and easy for clients to accept the quotes online.

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The customer can accept the quote at any time. There are fields for an order number and additional comments. Most importantly the customer is required to tick the ‘yes, I agree and accept’ box before they can hit the ‘accept’ button – effectively signing on the dotted line.

Sooner or later (fingers crossed) your customer will accept the quote and it’s at this point where you can have your accepted quote automatically sent to Xero. Integrating Quotient with Xero really completes the workflow for most businesses.

Their reporting on the dashboard is also great for cashflow forecasting. In fact, it is the best cashflow forecasting tool I have ever used because it is so simple. Simply look at the quotes confirmed in the “last 30 days” and you get a good idea of what the bank account will look like in the following 30 days.

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You and your customer receive an email notification, confirming their acceptance of the quote, rounding off a slick experience

As above, you can have draft invoices

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I strongly recommend Quotient.” Will McTavish, CEO, Link Solutions www.linksolutions.co.nz

Issue 01 / 39

posted by other team members onto a quote for you.

There’s some handy analytics which provide an insight into how your sales are tracking. You get a breakdown of accepted vs expired and declined vs quotes still out there in the wild waiting to be accepted.

Our story, how we got started Back in the early days of Black Sheep we developed our own rudimentary quoting system which allowed us to manage all of our quotes. We would email our client a unique link and they could view the quote in a web browser. Essentially it was a quote laid out on a static web page, with little functionality – but it looked innovative and always set us apart when we were quoting against other web companies. At first, the client couldn’t accept the quote online, let alone pick and choose optional items listed on the quote. They’d have to reply to the email to indicate their acceptance and describe any component they wanted to exclude. The catalyst for developing the online acceptance was one ‘pain in the neck’ client who was notorious for giving us vague acceptance instructions. After this functionality was introduced, we’d refuse to start his projects until he hit the ‘I accept’ button. Over time, as the system improved, clients would ask us if we could build them a similar quoting system for their business. Obviously being on the receiving end, they had positive experiences and could see the benefits. We always laughed it off and would tell them, “there’s no way you could afford to pay for a bespoke system like this”. But the hounding didn’t stop. In a single month we had an Agricultural contractor, a Tree Arborist, a Pest Controller and a Mag and Tyre retailer all crying out for the same thing – a quoting system just like ours. A lightbulb moment finally occurred and in late 2010 we made the decision to cut back on client service work and focus our efforts on building a new quoting system from scratch. Quotient was born. Quotient is a really niche product, in that it does one thing (a.k.a the quoting workflow), and it does it well. That one thing also appeals to a really broad range of businesses and industries.

40 / Issue 01

We’re constantly surprised by the different types of businesses using Quotient and where in the world they’re from. For example, early on we had some close dealings with two completely different customers, both from New York… one a cleaning company who provides quotes to clean apartments for your average-Joe member of the public, and the other, an advertising agency who provides quotes to design packaging for some of the biggest brands in the world. While their businesses are wildly different, their quoting system requirements are much the same, and equally suited to Quotient. We’d always intended Quotient to have mass global appeal, so from the beginning we included some basic internationalization magic. We identify the location of a new visitor to Quotient and, in turn, reflect their correct timezones, currencies and tax defaults. This makes it just as easy for a business as far away as Zambia as it does a local business from here in little old Hamilton, New Zealand to find us through Google, start a trial and (hopefully) continue on to become a paying customer. The idea of serving customers all around the world is super exciting for us and now over 75% of our customers are from outside of New Zealand. That said, we still get a real kick out of hearing from friends that they received a “Quotient quote” from some (unknown to us) local business.

of their thriving ecosystem of cloud applications. This ended up being the catalyst to launching Quotient out into the marketplace. Since then we’ve been fortunate enough to ride in their jetstream and get exposure in markets where they’re blazing into. Not only has Xero helped us from a marketing perspective. Rod Drury has always been a huge inspiration to us. We first heard Rod speak back in 2009 at a web developer conference, when at the time developing one dollar iPhone apps was all the rage, but he encouraged us to jump on board and start building SaaS products instead. “Get 100 paying customers and you’re on your way”, he said. In February 2013, Xero presented us with the ‘Emerging Add-on Partner of the Year’ award at their annual Xerocon conference in Auckland, which of course was another huge boost. We feel privileged to be involved in the Xero ecosystem and it’s been great getting to know some of the Xero crew and other Addon partners who are on a similar journey to us.

To find out more or to take a free 30 day trial, please check out our website: www.quotientapp.com

In February 2012, we released our integration with Xero and became part

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Under the microscope: the Xero API

Hannah McIntyre, Co-Founder of CrunchBoards, shares the team’s experience of Xero’s API Words: Hannah McIntyre

Are you considering building an application that plugs into Xero? What solution are you trying to solve? What have you got a passion for? Making the decision to become one of Xero’s Add-ons was a no brainer for us at CrunchBoards. We had used Xero ourselves for 3 years and had already seen the power of seamless software integration when plugging in ReceiptBank and Salesforce with Xero to improve efficiencies in other areas of our business. Efficiency is the name of the game. Working smarter, faster and leaner is something every business is looking to achieve at an organisation and personal level. Selfishness also had a part to play in our decision to develop CrunchBoards. This is our second cloud software business. The first was a 12-moduled integrated back office system for the hospitality industry, which delivered instant management accounts across single & multiple site entities. We couldn’t find for our own business the solution we delivered for our customers. Whilst we love Xero, we still had to extract data from it and use spreadsheets in order to get under the hood of our own business’s management accounts and cashflow projections. This took time and meant we were always working with timelagged data. The reporting Add-ons out there just weren’t flexible or robust enough to meet our growing needs. The next step was feasibility. So we went out and started asking questions, lots of them, in over 100 interviews. We talked with business owners and accountants alike to find out whether the pain we were experiencing was common. It was, and throughout this process, the design of CrunchBoards and how it needed to work in order for it to become a transformational everyday tool was plotted. Having come full circle with the first business, selling it this Summer, we knew some of the pitfalls of development and have been fortunate to benefit from accelerated and tighter strategies this time round. We are obsessed with the Scrum methodology of agile software development. Scrum uses the real-world progress of a project — not a

best guess or uninformed forecast — to plan and schedule releases. In Scrum, projects are divided into succinct work cadences, known as sprints, which in our case are two weeks in duration. At the end of each sprint, we meet to assess our progress and plan our next steps. This allows our direction to be adjusted or reoriented based on completed work and tested user experiences, not speculation or predictions. If you want to find out more, this is a great site: http://scrummethodology.com. When I explain our software application to others, I describe it as an iceberg. What you, the user, see when you log in is merely the tip. The infrastructure that supports it and creates the flexible and instantaneous calculations is huge. Our architecture took a lot of careful planning in order to futureproof rapid growth. Since our soft-launch in May this year (our full global launch being at Xerocon Sydney in August), we (at the time of writing in July) have just over 8,000,000 transaction lines in our database from completely synced Xero organisations. We took the decision to pull every single transaction from the beginning of time for each organisation to ensure the reporting could be as granular as possible. This has not been without its headaches. When you integrate with another platform such as Xero, you are completely dependent on their API documentation and service. In the main this has been a pretty seamless exercise, but not always. The initial syncing process, the joy of access tokens and their short life span, proved to be something that took longer to nail than we’d have liked, but I would recommend talking with the Xero team headed up by the lovely Ronan Quirke. They use calendly.com to give you access to time slots that can be booked for general question time, demoing and problem solving. I’d highly recommend booking 2-3 weeks in advance over a 6 to 8 week period when you are 80% there with your app’s first beta release. There are always last niggles and having the security blanket of an expert such as Ronan on hand was invaluable to us. The team have also been fantastic with their QA procedures and getting us listed as a global Add-on.

Well sure, but the API is a work-in-progress and continues to be enhanced every month. Where we’d like to see some enhancements are around the communications that the API sends to you about the organisation you are syncing with. As an initial sync kicks-off and the data starts to flow, we cannot accurately state the amount of transactions we are about to pull through. It would be great to be able to give an indication to our users of how long their initial sync will take but, unfortunately, we can’t speculate how large their files are. We are also limited to the speed that Xero serves up the data – again, something we can’t precisely communicate to our users. Error handling is also an area that could be improved in order to aid not just our team, but also our end users. The information we receive from Xero, if the API has experienced issues, is lacking – and the time spent investigating whether it’s them or us could be saved. This goes for general API requests and the bigger picture too. We are unusual in that, after the initial mega-sync, we also sync every organisation’s last changed data every 3-6 hours automatically, so we’re talking to Xero a lot, which also means we are exposed to any API failure. A couple of weeks back, on a Saturday, Xero had some server issues which knocked sync processes considerably, severing the connection with a number of organisations and preventing just a handful of users from being able to perform their initial sync. An alerting system via email or similar would really help to mitigate these challenges. We all want to deliver a delightful user experience, but the life of an Add-on means that you are truly at the mercy of the application that you integrate with, so communication from them to us is key.

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All that said, the support and warmth we have experienced from Xero to date has been fantastic. We’re delighted to be part of their thriving eco-system, who’s going to be next?!

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Issue 01 / 41

Growing Up: The Real Way The World Works… Words: Peter M. Vessenes, CEO of ProfitSee

I had a dream growing up. I wanted to save the world. I was always busy, trying to discover how. So many things to do, and so many things to learn…

the combination of being a professional speaker, author, contributing editor to several financial magazines and having helped hundreds of businesses had still not gotten to what was most important… I never lost the dream.

Being the oldest son of Greek immigrants on the South Side of Chicago in the late 1950s and 1960s meant you had to be streetsmart to survive. It was also a time of incredible commitment to educational programs for the ‘talented and gifted’ crowd. I was asked into those. I loved math and science. I was an awardwinning musician, very active in high school theatre, a three-sport athlete. I even was a Fortran and (one of the first) BASIC programmers. Like most young men of the time, very into cars. I had traveled around

the world a lot by the time I was 18. Went to a private university in Colorado, and had no idea of what I wanted to study, or what kind of a career I wanted to build. All this was overshadowed by the very turbulent times of the Vietnam War, Richard Nixon, Woodstock, and changing moral standards. I got lucky! Married my brilliant (and outrageously beautiful) college sweetheart, graduated on time, worked as a news director for a rock and roll radio station whilst Katherine went to law school, and 42 / Issue 01

still had no idea of what to do with my life. Time was running out; we were starting a family, and it was my turn to go to graduate school. That was when things started to make sense; I studied Community Development/ International Relations. Next, a government job as a think tank facilitator on health care reform in rural America. ‘Mixing’ all of these disciplines suddenly made sense. What didn’t make sense was working in the ‘public sector’, that is, government. Inefficiencies in the bureaucracy are legendary, but combining it with their outrageous self-interest and lust for power made it impossible for me. I reached out to the private sector in 1982, working with corporations on how the stratospheric growth of microcomputers was impacting them. I got to help multinationals and fast growth startups go through astonishing transitions. Just like I found out in the public sector, ‘big’ companies were not always fun, and the 1990s saw a shift to the SMBM marketplace. By the mid 2000s

Business (and trade) is what makes the world go round. Over two million air miles kept pounding on me why this was true, regardless of the continent, country, or socio-economic persuasion. ‘Fixing’ companies was a passion of mine, and globally most companies were in dire need of help. My adult life ‘time on the street’ led to a critical conclusion: there is a minimum of eight disciplines that any business must address to succeed. These are 1. The Client Experience in the Sale 2. Strategic Marketing in its twelve components 3. Workflow/Efficiency 4. Compliance/Regulatory Law 5. Technology 6. Human Resources 7. Fiscal Management of the Company 8. Business Planning The weakest of these (in nearly every business, regardless of size) is Fiscal Management. Even large corporations don’t get it. I had trained analysts in Fortune 200 companies on building complex algorithms in spreadsheets. Small businesses had neither the skills nor the budget to hire that kind of in-house talent. That was how ProfitSee was born in 2008. We needed to find a way to provide both. The applications came first. The skills used in multinational companies in fiscal management could come to the small and mid-sized business marketplace through the software. The second was more challenging. I had learned how to provide the services though my practice. How do we reach

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the global community? That’s when my epiphany happened. It had to occur through the people business owners trusted to ‘understand’ their money: their accountants. In 2009 Intuit approached ProfitSee. “Would we become one of the founding developers on their App Center?” ProfitSee’s products became successful in the US marketplace, as we continued expanding the features and benefits of our various products. We won the ‘Best in Show’ Award at the 2010 Cloud Jam. Late 2012 brought an incredible serendipity. We met Xero in their first year of having offices in San Francisco. What followed has been an astonishing foray into the global marketplace. Xero’s focus on helping accountants provide value added services through its cloud based applications seemed like coming home to family to us.

The commitment to continuing education, support systems, and continuously upgrading the applications to what accountants needed was cut from the same DNA. Both companies even launched at about the same time. It felt like twins separated at birth.

Updates to our applications occur every few weeks. Frankly, we built and priced our applications in such a way that the labor costs of generating even our most basic features are higher than the monthly licensing fees of the application. We don’t charge more for the new features.

The impact of our relationship with Xero has been astounding. We now have users in Australia, New Zealand, the United Kingdom, South Africa, as well as the USA. What is it that we are providing? Our applications are frequently regarded as ‘reporting’ tools, but I must take strong issue with that. EVERY developer’s software contains reports: how else would you find out the value they are providing? We are not just a reporting tool, or even just an analytic tool. Though we have many ways of analyzing business circumstances as they revolve around cash, risk, assets, debt and fiscal management, ProfitSee actually provides the tools for proactive management of businesses. That is, after all, what a CFO in a multinational company does.

All this is well and good, but still doesn’t answer my own core question: How can we “Save The World”? Micro, Small, and Mid-sized businesses are the backbone to the economy. We believe that by improving efficiency, financial stability, profitability, and valuation in the small and mid-sized business world is the way. ProfitSee applications have the tools, and accounts, bookkeepers, CPAs, and business advisors have the means. They can provide value added services to their business clients at a price level that is great for those businesses. The practice will prosper. Together we will change the global economy, one small business at a time.

The features are broad and deep; from an ‘artificial intelligence’ driven budget generator, to three year balance sheet forecasting, to the ability to create and save unlimited, sophisticated ‘what-if’ scenarios; it goes on and on. Unfortunately, my editors have not given me enough column inches to share all of them! We are one of the few applications for Xero that can monitor franchises. We benchmark performance on multiple companies owned by a single entity, provide ‘private labeling’ on the accountant’s logo, fully automate report generation and distribution, and provide a complimentary lifetime license to a single company for any Xero Partner that is Bronze or higher.

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Visit: myprofitsee.com

Issue 01 / 43

Behind the scenes:

Words: Heather Smith

Managing Director of Virage IT and CoFounder of Wise-Sync, Paul MacNeill, grew up in what was the semi-rural suburb of Wittlesea, about 40 km north of Melbourne, Victoria. As an entrepreneurial youngster, to earn pocket money, he sold ‘old’ newspapers to neighbours, washed cars and mowed lawns... Described by his wife as a workaholic, MacNeill says, “I get a lot of satisfaction in helping people. For me it’s about seeing people’s business lives changed by a product as simple as Xero. That really is what it is, fundamentally. It’s not a complex system. It’s really easy to use and people are often daunted by financial management because they don’t get it”. He goes on to say, “What excites me is seeing people have a sense of relief when the problems are lifted off their shoulders from a business perspective around this financial management space.” Like his favourite super hero Iron Man, the Specialist IT Consultant is constantly looking to challenge technology; “We are still sort of stuck in the old ways, thinking in the old format”. He goes on to explain that with toddlers thinking everything is touchscreen and coding being taught in primary school, “It’s mind boggling to see how technology adaptation has almost evolved in the environment to a point of saturation”. Working at CPA Australia and with accounting firms, one of his key takeaways was the concept of recovery from all staff whether they were in billable or in back end roles. It’s about ‘looking for innovative ways to earn income’. As an example, Virage IT employed two administrative staff, who were 100% non-recoverable. They evolved their roles to offer functional WiseSync support and conversion assistance, generating additional revenue for the business. 44 / Issue 01

Understanding the ‘business processes’ issue of an IT Services organisation from a user perspective, Virage IT developed a solution to assist them in their own business. Almost immediately, other companies asked to license the solution from them. By solving their own core business processes problem, they spawned a new product, Wise-Sync, creating another business and a complimentary income stream. Wise-Sync is the first Xero approved add-on that synchronises accounting data between ConnectWise and Xero via the Xero partner API. Its secure integration replaces manual data entry, and results in time and cost savings for the user. Wise-Sync enables IT Services firms to achieve financial visibility from using tools like Xero, giving the business clarity around even simple financial aspects like debtor days. To understand Wise-Sync, you really need to appreciate the global company ConnectWise. ConnectWise offers a cloud business management platform that encompasses CRM, ERP, marketing, service management, and project management specifically suited to businesses in the IT Services industry. From a transaction perspective, all of the information flows from ConnectWise through Wise Sync into Xero. This solution scales to businesses from one-man bands through to global multinationals. Wise-Sync sits in the Xero add-on ecosystem, but it also sits in the ConnectWise marketplace.

ConnectWise partners tend to be plagued by a lot of manual processes and embracing the simplicity of the Wise-Sync Xero integration makes a difference to businesses of all sizes. “If you’re an IT helpdesk and need to send someone out on Tuesday 9:00am to fix your computer, ConnectWise facilitates the management of resources billing, agreement management and CRM marketing”. He shares a story of a small IT Services firm based in Coffs Harbour, NSW; “After implementing the solution they realised efficiency savings of $50K a year through the reduction in administrative and bookkeeping costs”. At the date of writing, Wise-Sync’s integration with Xero is the highest rated cloud accounting integration solution in the ConnectWise marketplace. Wise-Sync connects to all global versions of Xero, and MacNeill is impressed with Xero’s robust API especially compared to other similar solutions available. Virage IT opted to develop a sync via a Xero Partnership solution which, once authorised, offers perpetual access, until the user actually revokes the access token. Built into Wise Sync is an innovation

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a cash flow perspective. What a disaster that has been. That was the cludgiest, clunkiest most horrible program to write too. As an API developer, we hit hurdles and obstacles and complete functional rewrite at every single entity.” Drawing inspiration from Simon Sineks’ book ‘Start with Why’, MacNeill explains, “When starting out in business you need to be clear on the why. There are two elements of why, why do I want to do this and why would people even bother wanting that? What I want and what they want are two completely different things.”

MacNeill is proud of: single record batches. A typical batch may consist of 100 invoices being pushed across. “If you’ve got a problem in just a single invoice you need to delete a batch release of 100 invoices just to fix one error even if it’s just a simple thing like the tax flag wasn’t ticked on one product. That creates a lot of pain from the accounts management perspective to control that. A single record batch solution means one invoice is held up, and once sorted can be pushed through. Simple – but no-one in the ConnectWise eco-system had done it before.” Xero’s Developer Relations Manager Riley James says “In my experience, Paul’s always looking for the best solution, not the easiest to implement. On the surface, applications often looks great, but it’s in the darker corners that trouble signs and workarounds show. In Wise Sync’s work I’ve only found elegant and thoughtful solutions.”

daily means you can just ‘chip chip’aroo’ at the reconciliations”, he says. MacNeill says directors of a $15 million a year turnover, multi-national IT Services firm who moved from Pronto to Xero using ConnectWise and Wise-Sync, told him “we find ourselves logging-in in the morning to see how much money has landed in the bank account and sometimes it’s too easy not to hit the okay button to reconcile that invoice to that payment because we know that’s what it’s for”. Directors of the company were, for the first time ever, able to get financial visibility on their phones, tablets or MacBooks... and they were actively involved with reconciling! One of the challenges Virage IT faces is developing Wise-Sync to work with other accounting solutions. “We love Xero and we don’t want to go anywhere else but when we need to pay the bills for development and product expansion one of the logical things is QuickBooks Online, although they’re the distant poor cousin to Xero in our eyes. It’s kind of ‘well there’s a bit of revenue there’. We can probably make our product work with QuickBooks Online. We could get some of the features across to QuickBooks Online. And we can probably capture the market share of QuickBooks Online and that would be very helpful from

Today, out of necessity IT Virage is evolving to match the market place. Businesses no longer need the services and software IT firms were offering 5 years ago, due to the free or low cost solutions readily available. The business is now focused on offering adaptive design solutions; “where you have systems that adapt based on when you need to access them and how you actually access them from different modes, and in different mediums”. MacNeill shares that an example of a good adaptive product is the user interface of Xero Touch which has been specifically designed for use on a mobile tablet device; “Xero Touch is a vastly different product to the Xero ‘desktop’ product.” IT Virage is proactively focused on both the ConnectWise community, and client requirements. They plan to exhibit at the IT Nation/ConnectWise conference in Florida in November this year. They will also ensure the product development life cycle is driven by client requirements as demonstrated by the introduction of recent product features including; multi-currency, multi-location and inventory mapping.

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From a reconciliation standpoint, MacNeill likes the way Xero works. He explains that with MYOB he was “always on the back foot trying to manage that, whereas now we’ve really been proactive”. With 1500 monthly transactions flowing through the accounts, he encourages all of the accounts team, including himself, to be hands-on with reconciliations. “The ability to reconcile

Connect with Wise Sync Web: www.wise-sync.com Twitter: @wisesync ConnectWise marketplace: marketplace.connectwise.com

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Issue 01 / 45

Lisa Martin:

Rock Star

“In fact, she’s a rock star in the world of accounting. She certainly knows how to make an entrance. It started from her stunning arrival into the world.....” Words: Heather Smith Heather Smith is Author of the Xero for Dummies series, host of the Cloud-Stories.com Podcast, Xero Advisor, and Chartered Certified Accountant. She provides remote Xero Set-Up, Support and Training, and loves any opportunity she has to write. If you need content, Xero assistance or just want to say Hi! Contact her via heathersmithsmallbusiness.com

Lisa Martin is the founder of GoFi8ure, a premium Mobile Bookkeeping and Management Accounting service. She affectionately refers to her team as GoFi8urines and says they form a strong relationship with their clients. Her GoFi8urines undertake processing from opening to closing balance and everything in-between. Martin explains: ‘We roll out processes, so transactions are done once, are done right, and the whole end of year process is a breeze for the client and the chartered accountant.” Today, GoFi8ure is a stable team of 10 staff based primarily in Wellington. Martin’s vision is to establish eight GoFi8ure offices throughout New Zealand, so that more businesses have the opportunity to have a GoFigurine working with them. Martin admits that understanding how to replicate this model has been a long and expensive learning curve. In fact, she’s a rock star in the world of accounting. She certainly knows how to make an entrance. It started from her stunning arrival into the world – in the back of an inebriated taxi driver’s cab, who crashed into the hospital wall. The challenges continued. During her early years she was raised as a foster child. When she realised her primary school classmates went home to a mummy and daddy, she demanded to go and live with her biological mother. When she was 12, her biological parents married and she imagined that life would soon be perfect as it started to resemble the normal loving family life of two parents and siblings she longed for. But unfortunately her parents fought, separated and she ended up living with her father. Understanding her challenging childhood goes some way to appreciating Martin’s commitment to building a strong team, and business around her.

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What’s the story behind the #smokinghotbookkeepers? At the first New Zealand Bookkeepers Conference, an invitation was extended to Rod Drury to speak. There was a diary clash, so in place attendees were invited to submit questions for Drury, which would be answered via recorded video. As you can expect, the run of the mill questions were asked, but of course cheeky Martin came up with a left of field question; “if you are in the car driving and you were playing a game of eye spy, which letter would you choose?”. Drury’s response; “S, for #SmokingHotBookkeepers”. The hashtag was born and the movement began.

In 1992, for Martin’s big OE (OE is a New Zealanders concept known as Overseas Experience, which refers to extended duration of travel and work overseas) she based herself in the UK and travelled around Europe and Africa. Amidst odd jobs, she found herself in a design firm taking them from paper-based accounts to successfully implementing a full blown SAGE accounting package. In 1997, Martin arrived home to New Zealand, landed a stimulating job, enrolled part-time at university, and found herself working or studying seven days a week for the next five years. Then, unexpectedly, her boss closed down the business and made everyone redundant. Unsure of what to do next she turned to her mentor Anne Stephenson of the accounting firm Stephenson Thorner who said to her: “Why don’t you do this thing where you go out to client sites and you roll on efficiency and processes and be their part time financial controller which is what you’re doing full

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Connect with Lisa Martin www.gofi8ure.co.nz www.sayitlikeitis.co.nz twitter.com/GoFi8ure www.facebook.com/GoFi8ure www.nzbookkeepers.co.nz

time now, but do it in a part time capacity. There are many businesses that can’t afford a full time you. Just go in and consult and go to the next one and so on and so on. Before you know it, you’re going to have 50 hours of work a week”. Martin was stunned at the suggestion, but took on-board her trusted advisor’s suggestion and within four weeks had 50 hours of work a week.

situation of high staff turnover. Martin faced a turning point in her business journey when she was recognised as an excellent technician, but not a very good people manager. She needed to learn how to on-board and manage talented people. To achieve this she turned to the New Zealand business coaching group, The Results Group (www.resultsgroup.biz), whom helped her develop and execute, amongst other areas, a people strategy.

She goes on to say, “If you’re going to get someone involved in your business, looking after your money and your finances, and kind of giving you advice that’s management accounting and cash flow management, you want them to hold business qualifications or certifications and have proven business experience”. In this regard she’s a little biased, as the Vice President of the New Zealand Bookkeepers Association she’d like to see all New Zealand based bookkeepers undertake the Certification test (www.nzbookkeepers. co.nz). “Anyone who knows their debits and credit can pass it”, Martin says confidently.

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Once Martin confirmed there was indeed a demand for this service, the challenge then became time; how could she replicate the services offered? Initially Martin hired university students and established her business as an approved training organisation, via the New Zealand Qualification Authority. It seemed like a perfect solution, young eager students were able to gain practical experience and CPD hours. But her vision of training a legion of university students was thwarted by the students’ exam stresses, hormones, and ultimately the desire to move to CA firms. This led to the undesirable

So what should a business owner look for in a bookkeeper? Martin has strong opinions on this. Experience, discipline, professionalism, tenacity, longevity, you don’t want someone whose picking it up as a career filler. She explains it’s essential your bookkeeper has “a strategic relationship with other bookkeepers because, if your bookkeeper gets sick, you need to know you’ve got a back-up plan”.

Martin set herself a weekly goal: to learn something new every week. “That means you’ve got to cover your calendar and actually put aside that CPD time”, she says. Reflecting on this, she thinks it is averaging out at one a month. “I find it very easy to keep up with Xero that just seems to be part of my DNA.” Martin goes on to explain she will sit for a whole weekend absorbing

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the detail of an Add-on solution – so she is in the position to provide training in it. “I’ve been doing this since I was 19. So I’ve seen it all before and nothing actually ever really phases me.”

She recognises that committing her time to that development is important an investment because, “ultimately it’s about my business, my team and revenue”. Martin enthuses with her adoration for the energy levels and achievements of Xero CoFounder and CEO Rod Drury. She says: “As long as I know that Rod Drury is out there in the world, doing what he’s doing, that really enables me to want to be a better leader for my team.” The respect is mutual. Drury when asked to share his thoughts on Lisa Martin, initially corrected us, referring to her as a Smoking Hot Bookkeeper (see inset); “Lisa has infectious enthusiasm, always laughing and smiling. We love how she has embraced the cloud and is building a great business helping hundreds of small business owners. Lisa has been there from the early days, evangelising and educating small businesses, bookkeepers and accountants. Her leadership has helped grow a vibrant bookkeeping community and provide a new purposeful career option for smart business people. Lisa is another one of our great people that make our community such a fun place. She is definitely one of our Xero family”. These days Martin looks forward to planning travel away. ‘I can go for three to four weeks at a time’. It’s taken seven years to pull a fabulous team together whom she can delegate to and whom she trusts to stick around. Martin also looks forward to bookkeeping conferences, Xerocons and hanging out with #SmokingHotBookkeepers.

GoFi8ures target audience is businesses who sell time; graphic designers, architects, lawyers, and IT professionals. They roll out in-house tried and trusted solutions to their clients: Xero: www.xero.com WorkFlowMax: www.workflowmax.com iPayroll: www.ipayroll.co.nz Debtor Daddy: www.debtordaddy.com Receipt Bank: www.receipt-bank.com 48 / Issue 01

Meet: MinuteDock Jared, the CEO and Co-founder of MinuteDock, a Xero-connected time tracking application talks to XU Magazine about the ‘connected cloud’ philosophy of Xero as a platform. He discusses the benefits of connected SMB software and why this is critical to your business. He ties this into the story & solution behind what MinuteDock has created on top of the financial platform that Xero has built for SMBs.

Words: Jared Armstrong of MinuteDock Jared is the Co-founder and CEO of MinuteDock, an online time tracking product based in Wellington, New Zealand. As a Software Engineering graduate from Victoria University in Wellington who’s had an entrepreneurial bent from a young age, Jared has been building web based software since he was still at school! He’s a keen rugby fan, gamer, business and tech enthusiast, bringing a unique combination of both business and technology experience to the table. He has been using Xero and developing software with the Xero API since 2009, and was one of the Xero API Developers of the Year for 2013.

In 2009, Xero was only a few years old and had less than 10,000 customers, but we saw that what Xero was building with their “connected cloud” philosophy was going to be a gamechanger for both us and thousands of other SMBs. As software consultants, we needed to track the time we spent working for clients, and invoice that at the end of the month. The issue was that, even just a few years ago, most SMB software wasn’t “connected”. The timesheet software that we were using was clunky, and we had to spend hours copying details from our timesheets into Xero to bill our customers. It was a total pain, and it was costing us money. Being software engineers, we love to solve problems when we see them. So we decided to build MinuteDock; online time tracking software, exclusively as a Xero addon. Since then, we’ve become the top-rated timetracking addon for Xero, been awarded Xero API Developers of the Year (an ‘API’ is the way cloud software connects and talks to each other), and named one of five ‘essential Xero Add-ons’ by Accounting Today. It’s been a truly exciting journey as we’ve grown alongside Xero, where we now help thousands of customers run their businesses every day. It’s no secret that Xero doesn’t provide all of the features and tools needed for the hundreds of industries and business niches that use it. A quick survey of Xero’s ‘feature request’ website will show countless people asking for features to solve their specific business problems. However, I’m a firm believer that, over the next 10 years, SMB software will be dominated by the nimble, specialised players that focus on either one industry or one type of problem. They’ll do this by connecting & integrating with each other to work seamlessly with all of the other software systems that an SMB needs to operate. I feel this is one of the major unsung innovations that Xero has led, one which has triggered a stepchange in the quality, availability and affordability of SMB software. With MinuteDock being one of the very first Xero Add-on

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Pictured L-R: Xero Head of Developer Relations Ronan Quirke, Xero API product manager Tony Rule, Nik Wakelin, Jared Armstrong, Xero CEO Rod Drury, James Nisbet. Nik, James & Jared were the three original co-founders of MinuteDock, each receiving the joint award for API Developers of the Year 2013 at the time, but since then Nik & James have moved on to other things and are no longer involved with MinuteDock.

partners, it’s only natural that I’d be a strong evangelist of the connected cloud ecosystem. Being part of the meteoric rise of Xero has certainly benefited MinuteDock by providing the platform and channel to grow our own business. But, it has also benefited Xero and the countless Xero users who, by using MinuteDock and the hundreds of other Xero addon partners, are able to run their day-to-day business with specialised software for their particular industry and problems. All this through

Xero’s financial platform that enables that software to be created and improved at a phenomenal pace. Whilst most of Xero’s early adopters implicitly understood the concept of the connected SMB cloud, many of the later adopters don’t necessarily understand where the cloud is headed and how to conceptualise connected software. Consequently, they expect Xero (and platforms like Xero) to offer a “one-stopshop” for all of their SMB software, without understanding the reasons why that’s a bad idea.

Here’s the issue: there is no such thing as the ‘one SMB software package’ that solves everyones every problem. To create a great software product, a choice needs to be made: either pick one type of problem to

solve for a variety of industries (horizontal solution), or pick one industry niche and solve their specific set of problems (vertical specific solutions). When software tries to go in all directions that is, attempt to solve all problems for all businesses,it invariably results in a solution that’s awful for everyone to use! The thing to keep in mind when looking at software and the features that it provides is that you’re most likely already framing it from the perspective of the specific industry that you’re in. This, combined with today’s general expectation of software having fantastic ease-of-use, is the fundamental reason that the connected

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software ecosystem is critical in providing efficient and innovative solutions for SMBs. Both Xero and MinuteDock have a philosophy of building the right tool for their customers, rather

Customer Opinion:

“We would be lost without this now, it’s so simple and efficient.” AbbyLee Porter Bookkeeper, Your Business Made Easy

Issue 01 / 49

than trying to be all things for all people. Thousands of people are getting the benefit of software built this way, but many more are missing out because they’re not aware of the benefits. For cloud-newbies (and veterans!), here are the top 5 benefits to businesses in embracing the Xero Add-on ecosystem and the connected SMB cloud:

1. Use software specialised to your businesses’ needs. The productivity benefits of using a solution designed for a specific problem or industry are enormous. Significant trade-offs are made in usability and flexibility when combining features into a one-size-fits-all package. Across a business and a team, the savings in time and training costs for using solutions that are able to be made simpler because they’re solving just a specific problem can significantly reduce admin overhead and increase the profitability of your business.

as possible. One of our innovations is in the way time is entered and tracked. Instead of filling out a form full of various fields and options, MinuteDock offers a smart system that understands what you type when you’re describing what you’re doing or what you did. We use a smart, Twitteresque approach for choosing what client and job you’re working on, which is both simple and super efficient. Tracking time is as easy as typing “@xumagazine working on the article for 3 hours #writing”.

sit front-and-centre on each MinuteDock user’s dashboard where they track time, and progress instantly as time is logged. This keeps everyone on-track with their work at a glance, and adds a bit of fun to knocking through their targets! Again, by being a product specialised to a particular problem, we can add great features fast. Our customers have said to us that they love feeling like they are involved and have a say in what features and improvements are madeit’s a win-win for everyone.

2. Specialised software products will improve faster. By virtue of being focussed on a specific problem (rather than every problem), connected software will generally receive more frequent improvements & additions than you’d receive with a “onesize-fits-all” solution. This is because each product’s team is listening and acting on specific feedback for what their particular product focusses on, rather than having to prioritise between all of the other features for other niche industries!

3. Scale your business software easily. The software that was ideal for your business on day one, may no longer be a good fit on day one thousand when your business has grown through the roof (hopefully!). When you’re using different cloudconnected software for different areas of your business, it’s easy to just swap out solutions when and where you need to, with minimal impact to your other software. The great thing is that this reduces costs and overheads of training and makes transitions during growth seamless.

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For example, MinuteDock focusses on time-tracking. We built on top of Xero’s accounting, invoicing and payment platform (we know they offer a best-in-class product in that space), as well as other cloud platforms like Amazon for our webhosting infrastructure. This frees us up to focus on making timetracking as simple and efficient

Early on at MinuteDock, one such request was the ability to track time targets. Since MinuteDock is the dashboard for the timetracking side of businesses, we could come up with a feature that really fit the use-case for this specific problem. ‘Goals’

4. You can use the best options for each specific need. In the past, you had to choose between software packages that all did each of 10 different things your business needed, but with their strengths and

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50 / Issue 01

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weaknesses. This meant that you needed to compromise by using a solution that wasn’t the best in every area. With specialised cloud-connected software, you can mix-and match by picking the best solution for each role, potentially having a big impact on the efficiency of your business. Recently, one of MinuteDock’s customers explained to me that previously they were using a single software solution that provided time tracking and CRM functionality, and it was good, but not great, at both. When moving to Xero, they swapped to use a specialised CRM tool alongside MinuteDock, allowing them to get great efficiency and simplicity in their time

Customer Opinion: “We have been using MinuteDock for 3 years now and it is fantastic! It is super easy to use which means our whole team remains diligent about logging our time. The project and task tags gives us the granularity we need for our business and our customers. The goals and reporting functionality makes it simple to keep a handle on things. We also give some customers direct access which is great for transparency. Integration with Xero is the pièce de résistance invoicing time is a dream. The combination of MinuteDock and Xero makes our time recording and invoicing incredibly efficient. We rely on MinuteDock and it has never let us down I totally endorse this service!“ Carl Penwarden Managing Director, Abletech

huge amount of investment to build. The Xero Add-on directory has gone from just a few options, to hundreds in only a few years! Xero is an industry leader in this regard, and many SMBs aren’t tapping into the huge potential to improve the efficiency of their business which is just a few mouse clicks away. It’s certainly an exciting time to be a small business owner. I can’t think of any other period, except perhaps during the invention of the personal computer, where opportunities to improve business processes have been appearing so rapidly! This comes about as a result of the shift to cloud-connected SMB software ecosystems, a revolution that businesses like Xero and MinuteDock have been championing. It’s not slowing down anytime soon either; almost every software product coming on the market has the systems in place to build connections with each other, and

as a result, we, the customer, get great specialised products to run our businesses more efficiently. The benefits of using specialised connected software products are clear: to run our day-to-day business at MinuteDock, we use half a dozen different products (including Xero and even MinuteDock itself!), and the time savings we get from using these amazing tools are critical to running a profitable business. Over the coming years, understanding the opportunity behind the “connected SMB cloud” are going to mean make or break for many small businesses as they find ways to keep up with ever more efficient competitors. What about you: are you connecting the best software to get the most out of your business? I may be a bit biased, but perhaps you could start by taking a free trial of MinuteDock at minutedock.com/xero

What happens in life, happens in Xero Words: Heather Smith

Reality for some small businesses is they run a bank account that’s a little bit business and a lot personal, and they occasionally pay for business items using cash and they don’t want to use the Expense Claims feature. Here’s how I deal with this scenario, but before I begin my explanation, it’s preferable to only utilise dedicated business purposes. And this section goes against all Xero approved advice, but it’s a reality for some clients, so worth elaborating on. Read through these steps, and think about whether this works for you — it’s a little bit tricky so not everyone’s cup of tea: 1) Add the bank feed that’s a little bit business and a lot personal to Xero. I call mine the “*Name* Bank Account, where *Name* refers to the individual partner. 2) Add a new liability account and check the box Enable payments to this account. I call mine the “*Name* Loan Account” 3) Reconcile business transactions that feed through the bank feed in a normal fashion. 4) Delete non-business transactions via the bank statements Dashboard area. Dashboard > Manage Accounts -> Bank Statements click in on the Bank Statements with the yellow box to the left of them. A table of the detailed transactions appears. Check the box to the left of the transactions to be deleted, and click the Delete button. 5) Add business related cash transactions via the Spend and Receive Money functions and mark them as reconciled. Yes it doesn’t matter the transactions did not go through the real bank account, this bank account ends up a mixed bag of transactions. To reconciled a transaction that has not feed through via a bank feed, click in on the transaction, select Option -> Mark as Reconciled. The transaction appears with a black tick to the left of it, on the Account transactions dashboard. 6) To ensure the financial reports recognise all transactions that have passed through the mixed bank account, periodically add and reconcile a balancing transaction from the liability account to bring the bank account to Xero.

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billing, alongside the powerful CRM system that they needed. This was a fantastic outcome for their business enabled by cloud-connected software. 5. The Add-on ecosystem fosters SMB software innovation. Building software on top of a platform like Xero allows solutions for problems to be developed much, much faster than ever before. This is because each product doesn’t need to provide the same basic functionality, which can take a

This needs to be done regularly, to reflect accuracy in the financial reports, and you must also do it to align with important tax dates. If the mixed bank account balance is positive, the required reconciled transaction is spend money to ‘*Name* Loan Account’ value of positive balance. Alternatively if the mixed bank account balance is negative, the required reconciled transaction is receive money from the ‘*Name* Loan Account’ value of negative balance.

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Q&A

Words: Staff writer

with Gavin George, WorkflowMax WorkflowMax is an all-in-one cloud based job management software that makes it easy to capture leads, track time, and create quotes, purchase orders, invoices and everything in between. Xero purchased the company in February 2012. We wanted to see what effect this has had by speaking with Gavin George who is the Co-Founder & General Manager of WorkflowMax. A thought leader in the cloud computing industry, Gavin intimately understands the challenges that companies face in transitioning and managing their business in the cloud. Having grown WorkflowMax to 5000+ customers worldwide, Gavin is a frequent conference speaker where he shares his thoughts on how cloud technology can help businesses grow. He is based in Auckland, New Zealand, where he spends his time chasing his two kids around their various sporting endeavours while trying to improve his very average (his words!) tennis game. Q: Why did you create WorkflowMax and who was the target audience at the time? A: I used to write software myself, not very well, but I used to write it. I built a software solution for an engineering firm and at the same time I got asked, “can you build a very similar type of software for an advertising agency?”. At this point I stopped and paused for a second, thinking ‘these guys are asking for pretty much the same type of thing’. I thought that surely there’s already something in place, something in the market that already caters for that. After a bit of research I found that there was, but it came with a high price tag. With the cloud, I saw an opportunity to do something specifically for the service-based businesses. The sectors it was originally for were creative design and engineering. Only by virtue of being partners with Xero 52 / Issue 01

and being seen in that number one Add-on position, did the accountants start utilising the application for their own practices. It was only then, I guess, the accountants came into the picture. Q: So are accounting practices now one of your main focusses? A: What we have now is a product called Xero Practice Manager. This is basically WorkflowMax with a redesign. This new product is provided to our accountant partners to run their accounting practices. We have still got WorkflowMax as a separate brand, but it is built on exactly the same code-base. They are essentially the same product, put under two different guises but the market needs to know this. The accountants need to know they are getting a product, Xero Practice Manager, which is designed just for them. Q: WorkflowMax has seen a lot of success off the back of Xero. Do you feel that being a Xero-owned company has accelerated that growth? A: I can see how, looking from the outside, you would think that. But to be fair, we were the first Xero add-on in the marketplace. We always had that front-running position and we were able to capitalise on that by growing rapidly alongside Xero’s growth. When clients come to Xero with various needs such as timesheets, quoting, job management, job profitability, the obvious answer is WorkflowMax. We were the first one there and because we were the first one, we were able to establish our position as the market leading Add-on to Xero in that space. As a result, we are the number one Add-on in the ‘Invoicing + Jobs’ category. There isn’t anyone who comes close in terms of that deep functionality

and product offering. Even though Xero now owns us, nothing’s really changed. Q: What is your role within WorkflowMax now and did it change with the Xero takeover? A: Historically I’ve worn a million different hats. When I started WorkflowMax I did anything and everything from building a website through to marketing, support and business analysis. Thankfully there are now people in place that can cover these areas and do it much better than me as they have time to dedicate to it. My main role at the moment now is to build teams so that we can continue to grow, and continue to grow our marketing. I have to ensure the team thrives and ensure that WorkflowMax can become the number one job-costing solution in the cloud. But essentially we are left alone, our own little company within Xero. Q: What is your vision for WorkflowMax going forward? A: I want to see us to continue to grow! We’ve got some fairly lofty targets, in terms of the number of organisations that we want on board, and we just want to continue to drive those. My aim is to make sure that this team operates as efficiently as possible, and we like to keep it lean. I don’t just grow head-count for the sake of it. I want to see the team continue to grow, but not unnecessarily. Q: Finally… everyone keeps asking when the timer is coming back to Xero Practice Manager; is it coming back?! A: Yes, absolutely! It’s a good feature and will be back in as soon as we can make it happen.

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What business owners really want Words: Colin Hewitt, CEO and Co-Founder of Float. Based in Edinburgh, Scotland.

There are a lot of things in life that we don’t fully understand. Technology, for example, can seem shrouded in mystery - “it just works” is a phrase that Steve Jobs would often joyfully remark. If only it were like that with business. If only business models just worked! Finding and keeping great people, communicating with existing customers and discovering new ones, while producing great solutions and making sure the numbers add up, certainly isn’t trivial. For the small business owner, this feeling of spinning multiple plates can be overwhelming. To add to that - it’s likely that what worked this time last year won’t be good enough this time next year. Technology continues to change the way we do business and the pace of change isn’t slowing down.

New opportunities

Back to the drawing board

We need to understand the past, but more importantly, and more than ever before, we need to consider the future. And it’s not all doom and gloom. There are serious opportunities emerging. We can trade globally and accept payments more easily than ever; we have new creative ways to access capital through crowdfunding and peer to peer lending. And of course having our accounting software always available in the cloud is a massive advantage. Thank you Xero!

The typical business plan will have a great financial model somewhere within its many pages. A three to five year P&L, balance sheet and cashflow, and – without fail – a smooth hockey stick pattern of growth.

Back to the future Having said all that, the future can still be a daunting place full of unknowns and uncertainty, opportunities and threats. Having a plan is great. But it’s generally acknowledged that the reward is in the act of planning rather than in the plan itself. As Mike Tyson famously said, “Everyone has a plan - until they get punched in the face”.

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The reality for most small businesses is that these are totally overkill. They’re immediately out of date and unrealistically optimistic.

What keeps business owners awake at night? Is it the last quarter performance or, is it the unknowns of the future? As we’ve seen with so many personal finance tools, the focus tends to be on a colourful pie chart of where you’ve spent your money last month; but that’s in the past! While its maybe interesting to see how my spending was broken down last month, what I really care about is if I’m going to run out of money this month, or if I

Issue 01 / 53

can afford a holiday. It’s the same with my business. The past is interesting, even insightful, but the present and future are what I really want to see.

Real questions that need answers

“We are finding that more and more of our small business owners are realising the importance of managing their cash flow and are looking to us to provide that information for them. Generating short term cash flow reports for our customers through previous methods was clunky and time consuming. Now, thanks to Float integration with Xero, we can provide a first class service to our clients with speed and in a format easily understood. The ability to ‘meet’ with our clients and share the same information online while discussing issues and updating figures instantly saves a huge amount of time, travel and cost which is not to be underestimated.”

Is there enough in the bank to pay our salaries at the end of the month? Do we have the cash to deliver this new contract? What is our tax bill going to be and is there enough in the savings to pay it? These are the questions that shouldn’t take hours to answer. It’s estimated that around 80% of small business failures are due to poor cashflow, and going into debt can cause serious headaches for a small business, so being able to anticipate cash shortfalls and build up a cash cushion for the lean times can make the difference between Stephen Paul, Director at Valued the survival and failure of the company. A set of management accounts won’t often reveal some of these core could use and understand it, and it has to issues. Business owners need the peace of involve minimal data entry. mind that there will be cash in the bank to pay the bills and meet the payroll. The trouble with making an accurate forecast is that there are a lot of future costs that aren’t actualised as an invoice Cash is the lifeblood of any or bill. We don’t get a bill for our rent, our business travel or payroll. We don’t have an invoice for the sales leads we’re about to close. When all else is said and done, it is the Those are targets, budgets and projections, availability of cash that will ensure a business can thrive. Having an accurate and and they flow together with up to date knowledge of expected payment dates on up to date forecast allows decisions to be invoices and bills to help us predict our made quickly and with confidence. Often, daily cash forecast. having this knowledge allows positive actions to be taken, rather than resisting When this information can be shared the urge to spend because of a fear of the collaboratively, with business partners, unknown. The trouble, however, is getting advisors and accountants, the forecast can hold of that forecast in the first place. be presented with confidence and without Where does it come from? Last month’s taking hours each week or each month. spreadsheet is already completely out of date. So much has changed, and the fear Float connects with Xero to pull in all the of updating it, getting it wrong, deleting latest transactions, and produce a forecast the formulas and messing it up all tends to that is accurate to the day. Its our hope and result in putting it in the “do later” pile. our vision that businesses have this insight at their fingertips and can engage daily with The solution is integration in the the real numbers of their business. cloud There are many complex desktop ‘spreadsheet alternatives’ attempting to tackle the problem of forecasting. Float was For more information, visit: www.floatapp.com built with two key mantras in mind. It has to be so easy that anyone in the company 54 / Issue 01

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Chaser – your invoices paid: on time, automatically Words: David Tuck, CEO & Co-founder of Chaser

At Chaser, our mission is to build Earth’s best products for chasing customers to pay their invoices on time. We strive to help businesses efficiently and easily avoid the scourge of late payment.

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Spoke to Aaron personally.

12 July

They have had trouble with client payment but have assured us they’ve recently received a big order of their own and will be able to pay in the next few days. Edit this note ▶

Aaron Banks

Invoice INV-0096 is one week overdue

11 July

▶

Charlotte Chaser

Invoice INV-0096 is one week overdue

11 July

▶

CHASE

Aaron Banks

Invoice INV-0096 is one week overdue

8 July

▶

Imogen Harris

Invoice INV-0096 is now overdue

3 July

▶

Charlotte Chaser

Invoice INV-0096 is now overdue

3 July

▶

CHASE

Imogen Harris

Invoice INV-0096 is now overdue

▶

CHASE

Imogen Harris

Invoice INV-0096 is due in one week

What would you do if doing this manually?

Your templates have repeatable prose that is fully customisable for your own style and tone, for example: “I hope you are well. I just wanted to follow up about….”. You then have placeholders for the pieces of information that will always be customer and invoice specific, such as: ‘invoice_ number’ and ‘customer_contact_firstname’.

Your customers We integrate with Xero on an hourly basis, so that information about your invoices is always up to date. This process means you avoid sending chasing emails for invoices that have already been paid. With Chaser, it is not a case of chase all or none of your customers. You can easily decide which customers and invoices you don’t want to chase automatically.

Your chasing templates We know that the email you want to send to gently nudge your customer 7 days before due date is very different to the email you

DATE ▼

want to send 3 weeks after due date. You can use Chaser to create an unlimited number of email templates for all your different chasing situations.

We have been thrilled with the feedback we have received. One of our beta testers, Emma Northcote-Green of Fresh Financials, said that “this is exactly the system I use for the customers who I (manually) do credit control for”.

Sign out

Email history INV-0096 You’ve sent 5 emails about this invoice. 3 of these were chases and 2 were replies.

We know that polite persistence pays when it comes to invoice chasing. Our product enables you to automate the process of chasing up customers over email.

We know from our Finance Director experience that chasing emails shouldn’t look and feel automated. If they do, your customers ascribe them a lot less weight and are much less likely to take the desired action of paying your invoice. An overarching principle in building our product has been to replicate as far as possible what you would do if you were sending these chasing emails manually.

Settings

Scheduling your templates You then configure your master chasing schedule of the templates you want to send out at different points by reference to invoice due date. These timings are fully customisable: 8 days, 7 days or 6 days after invoice due date. It’s completely up to you! If you want to, you can apply your master chasing schedule to all the customers and invoices you want to chase. However, we understand that not all customers are created equal when it comes to how you want to chase them to pay their invoices on time. There are some that you have special relationships with. There are also problem customers that never pay their invoices on time. We give you the ability to override your master chasing schedule and customise a specific chasing schedule for a particular customer. Even for a specific customer, we know that not all invoices are created equal when it comes to how you want them to be chased. For example, an exceptionally large invoice

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1 July 24 June

for that customer may require a different, more protracted, sign off process. So we also enable you to customise an invoice specific chasing schedule for a particular invoice.

When we chase We don’t want you to have to reconcile your Xero bank accounts every day to ensure that chasing emails are only sent for those invoices that are genuinely outstanding. We allow you to specify the days and times that you want your chasing emails to be sent, for instance, once a week on Monday at 11am. We then notify you prior to that chasing time to remind you to update Xero. So you can enjoy the benefits of automated email chasing without excessive bank recs!

If it looks like a manually sent email, reads like a manually sent email… Your chasing emails should come from you; not a “noreply@...” in sight. We enable you to apply email

Special XU Magazine offer Chaser is launching to coincide with the launch of XU Magazine. We are offering the first 50 XU Magazine readers the exclusive offer of one year’s use of our product, completely free. Simply go to www.chaser.io/xu and then get chasing! We’d love to help you get your invoices paid on time, automatically.

Issue 01 / 55

signatures to match your regular emails. Set the font style and size of your chasing emails to match what you use normally. You can also specify multiple different CCs at your own organisation and your customer that you want the chasing emails to be sent to.

Thanks for paying

Chasing multiple invoices in one If you had multiple outstanding invoices for the same customer, you wouldn’t send separate emails to the same customer contact about each one. You would send one email covering all of the invoices. Chaser enables you to automate this too.

Attaching invoices and statements

Why not set up ‘thanks for paying’ messages as part of your chasing schedules?

Often, customers will respond to a chasing email saying that they need a copy of the invoice, which leads to further delays.

We will find out through our hourly update with Xero that this invoice has been fully reconciled as paid. Chaser then immediately populates and sends the relevant ‘thanks for paying’ message.

Chasing escalation points

Chaser solves this problem. We allow you to attach copies of the invoice with the chasing email so that you can avoid this potential delay. With a chasing email for multiple invoices, we enable you to attach statements.

to the 4 chasing emails sent to date? You need that essential qualitative information about where you’ve got to in the chasing conversation. With Chaser, you can easily access details of the chasing emails we send out for each invoice. We consider that a basic requirement. On top of that, we also display details of the replies and re-replies that the chasing email precipitates. Within Chaser you can also easily make a note of phone calls or meetings in which payment of that invoice was discussed. So at the click of a button you can easily access the complete chasing conversation for a particular invoice.

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We know how effective it can be to build escalation points into your chasing process. Chaser enables you to automate this too. For example, the email sent 7 days before due date could be sent by your bookkeeper, with the email sent at 21 days after due date sent by your Managing Director. You can do the same with who receives the emails within your customer’s team. So the 7 days before due date email could be sent to the accounts payable clerk, with the email sent at 21 days after due date being sent to the FD.

The chasing conversation

Of course you can get an accounts receivable report of your outstanding invoices any time you want. This is useful management information. But it’s a very blunt instrument in predicting when your invoices will be paid.

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Say you have two invoices for the same amount, both 3 days overdue. Are they identical from a cashflow perspective? What if one replied to your last chasing email saying it would be in the pay run on Friday, whereas for the other you have had no reply

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Xero Blue Print: C:90 M:0 Y:15 K:0 Screen: R:0 G:183 B:227

PLACE LOGO ON WHITE

BLACK & WHITE

This is the preferred colour treatment of the Xero Partner logos.

Primarily for use in newspaper or similar, where black and white are the only options.

Dark Blue Print: C:100 M: 35 Y: 35 K:0 Screen: R:0 G:130 B:155

Print White: C:0 M:0 Y:0 K:0

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Similar to ‘Black & White’, this treatment should only be used when full black is too strong.

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Closing words...

Why it’s less ‘pivot’ and more ‘handbrake turn’ If you’re a frequent digester of startup blogs, you can’t escape the over-used term, “pivot”... A pivot, according to these bloggers and other opinion leaders, is a strategic change in direction away from your current business model, based on customer feedback or changes in the market. I’ve never liked the term “pivot”. I was recently talking to a fellow startup founder about Satago’s own “pivot” to focus on accounts receivable automation and I told him that I don’t think “pivot” is a suitable term for the experience. A pivot is when you change direction with one foot placed on the ground. It’s soft, it’s gentle, it’s quick, and once you change direction with your pivot, you put your foot down again and you know which way you’re facing. Dancers pivot. Martial arts students pivot. Startups don’t pivot. Startups make handbrake turns. For one thing, a pivot takes an instant, whereas a handbrake turn takes considerably longer. Now, startups may be embracing “agile development” these days, but that doesn’t mean it’s somehow easy for your two-developer startup team to just change your entire technical model overnight. Even for an early-stage startup, it could take weeks, or months of planning and re-factoring and might involve a complete re-write of your application’s engine. In our case, implementing a regular SaaS subscription pricing model, which might appear easy from the outside, was made considerably more difficult for us because our 58 / Issue 01

previous credits-based model was inherently tied-in to many parts of our functionality. Pivots are not scary. Handbrake turns are scary… but not necessarily for everyone in the car. The CEO may think he is a “Fast & Furious” style driver, but everyone else in the car is probably petrified, eyes wide-open in terror and knuckles turned white as they grip on to whatever they can to stay in their seats. As a CEO you need to be able to transmit that confidence to the rest of the team in the car with you so they don’t pass out with fear. Also, with a handbrake turn, you’re never really 100% certain what direction you’ll end up facing. The confident CEO thinks he knows, but does he really? Hopefully you’ll end up facing in the direction you planned, but if you hit a bump in the road you might end up somewhere you did not expect. Worst of all, you might flip the car! It’s only once you stop sliding that you can really put all your energy in to moving forward. There’s probably still a fair chance you’ll “fish-tail” the car for a while before you really get traction. The same applies to your startup. The process of changing strategic direction can be scary and hectic. As a startup CEO it’s understandable that you will want to give the impression to outsiders that you have complete control over the process and make it seem as calm as a dancer’s turn, but don’t be mis-led by other CEOs’ calm exteriors - this startup CEO advises you to be prepared for a few startup handbrake turns. Words: Steven Renwick of Satago

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Why people love Xero Simple. Smart. Secure. ■■ ■■ ■■ ■■ ■■ ■■ ■■ ■■ ■■ ■■

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