The emergence of cloud accounting apps saw accountants and bookkeepers taking on a new role; one that sees them advising on technology to help streamline and automate the financial data collection and compilation process. Many of the successful firms out there today are not just advising on numbers but also on implementing the right interconnected technology that automates the reporting process.
But what’s next for cloud accounting apps?
Well, maybe we should look to FreshBooks, a leader in cloud accounting since the early days. The #2 largest small business accounting accounting software provider in North America hailing from Canada (whoop whoop!) recently received a significant strategic investment from banking giant JPMorgan Chase and I wanted to get CEO Mike McDerment’s take on what the next evolution of cloud accounting software may look like and how it may impact accounting & bookkeeping professionals.
With JPMorgan Chase entering into the space, it’s clear that banks see accounting software as a way to directly tap into the small business market and perhaps offer integrated services directly within the software. In this sense, I think what we may see is a shift from just software being integrated into your cloud accounting apps, but also services as well. With that, perhaps accounting professionals will now also need to not only advise on which apps integrate best into your cloud accounting software, but also, which services.
I wanted to get Mike’s views on the intersection of accounting, banking and technology, so I sat down with him to chat about what might be in store for the future of cloud accounting apps as well as to chat about the awesome culture around innovation and customer service that was built at FreshBooks (and how accounting firms can learn from it).
3:14 – Quick background on FreshBooks as starting as an online invoicing tool and then shifting to a full blown cloud accounting apps.
5:08 – With banking giant JPMorgan Chase recently making a strategic investment into FreshBooks, I briefly describe my thoughts on the ever-increasing integration of not just apps, but now services (in this case, banking services), into cloud accounting software. I then ask Mike how the relationship with JPMorgan Chase started.
11:10 – Mike gives his views on the deeper integration of banking services with cloud accounting software. The core concept (at 12:00) is that JPMorgan Chase is thinking of things (like FreshBooks) like a platform where payments (ie. taking a cut on credit card payments) is just one component of the financial services stack. This is a very interesting point because it proves that we’ll likely see banks further integrated with your accounting system.
14:13 – Mike answers my question on whether we’ll see banking services like loans & insurance products being more integrated in your cloud accounting apps.
16:15 – How will deeper integration with banking & accounting software affect accounting professionals? He talks about the increasing and unrelenting need to stay up to speed with innovation.
18:46 – A few years back, FreshBooks took a risky move to completely re-build and transform their well-functioning, popular software from the ground up to meet upcoming changes in the market. Mike gives his perspective on how this applies to accounting firms who may be going through the same business transformation on their end as they modernize their firms (and how a lack of action will actually affect their firm’s valuation).
24:45 – I was always impressed with the quality of FreshBooks’ customer service (just try calling them, they’ll always answer in less than 3 rings). I ask Mike how FreshBooks has scaled and maintained the culture around customer service as the business has grown to several hundred employees.