CPA Practice Advisor

DEC 2012

Today's Technology for Tomorrow's Firm.

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COVER STORY punch cards for one of the largest accounting firms in Washington D.C., so I was quite literally born into it. Ultimately, though, I love finance and helping people improve internal efficiencies. Also, I want to provide the profession with the right technology to support them in adding even more value to their services. DARREN: Where did you get the idea to deliver PayCycle through accounting firms? RENÉ: This is a great question. I remember the day we came up with this. It was at the Los Altos office. We had just learned that our original strategy for PayCycle had some legal issues, and that meant we needed to change course. I went for a walk with my co-founder Martin Gates to discuss options. While walking, we discussed how many firms perform payroll because they felt they had to in order to keep a client…not because they wanted to. We discussed the power of the Internet and how it would al low f irms to become mini-payroll service firms. We were very excited. Tat day, I visited my accountant and started our first focus group. DARREN: Today there are many web- based solutions. Of course, you were using the Web as a delivery platform years ago. How did you know 10 years ago that this was the way to go? RENÉ: I realized the power of the Web in 1995 while at Intuit. We were reviewing Checkfree, and I realized that services were way more powerful than soſtware, and that the Internet was the ult imate plat form. As I launched PayCycle, I further realized that cloud services were so much more than anytime-anywhere access. The Internet brought about the democratization of services that were previously reserved for accountants and businesses with lots of money. Te cloud was a game changer—leveling the playing field. DARREN: Aſter exiting PayCycle, you immediately started Bill.com. Where did you get the idea for this service? RENÉ: PayCycle was growing fast and I had lots of bills to pay. Te early lessons offered by my family became very clear—mainly that cash is king, and I needed to stretch out the pay- ables and pull in the receivables. Te process at PayCycle was manual and slow. Every Friday, our office manager brought me a stack of checks with invoices atached. Oſten docu- ments were missing, approvals were non-existent, and bills were paid late. I started to brainstorm for a solution to address these pain points. That solution was Bill.com. DARREN: What were your biggest challenges in geting Bill.com to where it is today? RENÉ: Bill.com defines a new cate- gory of service focused on cash flow command and control. Being a new category, it has been a challenge to communicate the value. We are not accounting or bookkeeping. We are not bill paying or invoicing. Yet, we do all these things directly or indirectly. Tis makes it difficult for people to understand and take the leap to adopt Bill.com. Add in that the profession is only just adopting cloud technologies, and that adds to our challenge. DARREN: What is your vision of how accounting firms should be using Bill.com, and how do you see that evolving over the next few years? RENÉ: With Bill.com, accounting firms have more controls, built in audit trails, complete transparency for every transaction, and the ability to collabo- rate with their customers. I believe that as accountants continue to adopt Bill. com, they will find they can offer more strategic insight to clients while also alleviating clients of the complexities of accounting. Tis represents a huge opportunity for firms. Moving forward, as more and more firms experience the power of the cloud, they will bring in more small business clients. The result will be more collaboration among firms, cli- ents, and vendors—and accountants will be at the center of that collabora- tion. DARREN: At what point do you see more firms being cloud-based opposed to desktop-based? RENÉ: I believe that businesses follow consumers. As consumers use more cloud apps, such as banking, social, email, or general search, they will expect similar functionality in working with their accountant. Let's take online bill payment as an example. I think it is safe to say that most con- sumers are using online bill payment for some if not all of their bills. People are starting to ask: Why do I have to write a check at the office? Why can't I pay vendors electronically? Tat pressure is building, and I believe that in the next three to five years we will see a massive change over. Further, I believe that in the next five to ten years more work will be performed in the cloud then on the desktop. DARREN: Do you think clients will push firms to move to a collaborative environ- ment or do you think accountants will be the primary source to move clients along the collaborative path? RENÉ: It takes both to make col- laboration work. I do think clients will push somewhat. However, in the short term, I think it is the early adopter— whether that 's the fi rm or the client—that will do the pushing. We have accountants that push all their businesses to collaborate using Bill. com, and we also have business clients that push their accountants to us. DARREN: You are very close to the accounting profession. What advice would you give a practitioner on positioning their firm for the future? RENÉ: One of the key lessons I've learned over the years is that you either lead or you follow. Te cloud is a major technology innovation that allows accountants to lead their clients. Te cloud supports real-time collaboration and enables firms to position them- selves as leaders and strategic advisors, so it's imperative for accounting pro- fessionals to seek out and implement the technology that moves their pro- cesses to the cloud. DARREN: You live and work in the heart of Silicon Valley. How does your location impact the strategic direction of Bill.com? RENÉ: Technology moves really fast here. Tere are so many opportunities to learn from investors, peers, and other companies, and I believe that it gives us a unique advantage. Tere are many venues to share learning about strategy, technology, and management techniques, so you really absorb a great deal of education by default. For example, the social nature of many consumer companies definitely inf luences how we think about col- laboration and social at Bill.com. Also, at the core of Silicon Valley, is the belief that failure is not just okay, but it's a good thing. Tis means that leaders here take risks, try new ideas, and genuinely enjoy the journey. Tis impacts us in many ways. Most obvious to us is in the people we hire. Tey expect the management team to live up to the culture of Silicon Valley. So, we work hard to ensure that we do. DARREN: What's the biggest challenge you see facing accountants and their firms today? RENÉ: I think the biggest challenge is making the migration from the static, non-collaborative tools to the dynamic, collaborative tools that are readily available. For example, every accountant should have an extremely user-friendly portal to share tax docu- ments with clients. Te tools are out there, but it means switching processes and learning new things. Tat is always hard. Te good news is that companies like Bill.com are focused on making that transition very easy. DARREN: What's the biggest tech- nology business trend that you see fom where you sit? RENÉ: I think the social trend is just geting started. While I don't spend as much time being "social" as others, I understand the power of it. Social media has become a part of the fabric of society in a very short timeframe. At Bill.com, we create collaboration with employees, accountants, cus- tomers, and vendors. Tis is, in a way, the social side of business. I believe the value in social col laborat ion is immense, and we are just seeing the beginning. DARREN: What do you see as the big- gest consumer trend? RENÉ: Again, my answer is social. More broadly, I would say that the cloud is creating the democratization of information never imagined before. Social on the consumer level is the democratization of your personal life. Social on the business level is the democratization of your business life. That means transparency when you want, with whom you want, and how you want. December 2012 t www.CPAPracticeAdvisor.com 7

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