Second part of interview tomorrow.
Cloud accounting software company Saasu is part way through a radical re-interpretation of accounting software that it claims will make today’s browser-based accounting programs obsolete. The process of “destroying the mothership” and rebuilding a totally new version of its software was required to leap ahead of the new competition in the cloud accounting market, Saasu CEO Marc Lehmann told BoxFreeIT.
In the interview below, Lehmann describes how accounting software will be built to follow different business models and not by number of features. The second part of the interview, to be published tomorrow, will look at the implications for third-party add-on programs and developers.
BoxFreeIT: What is wrong with a browser-based approach to accounting software?
Marc Lehmann: What we’ve got now was designed for an era we are leaving. The market has always been and still is focused on building an accounting system, even in the web application space. (Software companies say,) “Let’s build an accounting system and fill it with payroll and contacts management and receipt books and payables”. It’s design by feature as opposed to design by business model.
Being feature rich like Saasu or beautiful as Xero quote themselves or thorough as MYOB would say, none of those things really cut it any more. Business owners are saying, “I have such limited time I want something that solves the task,” and it’s almost like everything else is secondary to that. That’s what we’re trying to solve.
It’s a shift away from giving them more than they need. It’s harder to conceptualise because we haven’t seen this done in many places.
BoxFreeIT: Are bookkeepers and accountants ready for a new mode of software?
Lehmann: A bookkeeper who is not willing to adopt automation systems and become a manager of their client’s affairs is going to struggle to survive. Some bookkeepers are adopting newer technologies and coaching clients. It’s less about doing the data entry and they have more clients at a higher price. We can already see there’s lots of evidence for that.
But the bookkeeper needs more systems that are tablet-friendly for when they’re out on the road and going to see their clients. Smartphone apps don’t quite cut it because it’s still too feature rich an environment to squeeze into a mobile handset. The format is too small.
We think the 7-inch tablet and larger is where we’ll see the customer base mostly migrate to, away from desktops. And those apps need to be fairly clean and simple and only have exactly what they need. We don’t want to try to be all things to all people in a single app.
BoxFreeIT: So what things do people most need in their accounting app?
Marc Lehmann: Customers want to have specific components of an app and not see anything else. You can still access things from the one screen but it’s not displaying parts that people don’t necessarily need to use because it’s not relevant to their business model.
BoxFreeIT: What wouldn’t be on the screen for an accountant using Saasu 2.0?
So an accountant isn’t likely to want to see the light CRM aspect of Saasu but is going to be interested in the reports and access controls and the ability to at least see a view of the transaction but not necessarily do something with it. And they will still want some controls like access to depreciation and journal entries, so that’s what they would see.
But you might get a business owner who says I’d like to get access to everything. They might have a very thorough web application experience. Another business owner might say, I just need to do invoicing and manage my contacts, so they might use an iPad app that really is just about doing that task.
I think that’s the new model. Saasu’s job now will be to provide really good solutions for different types of business models and workflow needs and automate as much of each of those business models need, but then the community will go and do more specific things.
BoxFreeIT: How many business models have you designed for?
Lehmann: We’ve got five key ones and some of them cross over. I don’t want to reveal too much just yet but obviously manufacturing and assembly is a big part of our business model, so it’s an obvious one that we’ve looked at.
BoxFreeIT: How many versions of the manufacturing business model do you have?
Lehmann: There are probably only two or three that are really relevant. Most people fit into two, and there’s a third that picks up 90 percent of businesses in Australia. Most accounting systems don’t manage workflow and don’t necessarily follow a transaction from estimate through to opportunity to quote to order to invoice, to credit note, etc. We are one of the few accounting engines that has built that capability in at the API and in the UI.
Building an inventory system is difficult and it’s definitely a point of difference between us and our competitors. So that’s one area we’re looking at in particular.
Another is the small business that needs an ERP-type system but isn’t prepared to pay the big bucks for Netsuite. People don’t have the dollars to spend on big implementations and training exercises and committing to what people claim to be subscription models but have to sign a contract for two years.
I think it’s a bit of a joke really that a lot of the new apps claim to be subscription and yet they want to put you on a one or two-year contract. That doesn’t sound like a subscription to me.
BoxFreeIT: What’s the best analogy for a software development model based on business models?
Lehmann: I think the best analogy is how people use Salesforce.com. There are so many different ways of using it. You can download different apps on the App Exchange and they’re all using that one platform and representing different ways of doing things.
You might be doing that on an app you’ve downloaded from iTunes for your iPhone. In another situation it might be something you’re using on your Nexus 7 Google tablet. But it’s all pointing back to this Salesforce.com engine. I think they’ve led that very early on.
The difference is that I think it’s going to be more an API based approach than us building a coding base and a platform for customers to build on that’s proprietary to us. That really frees it up and allows developers to do a lot more without being constrained to our platform.
BoxFreeIT: So cloud project management apps such as GeoOP or Connect2Field could build an interface for Saasu, for example?
Lehmann: Exactly. We don’t want to control the market or for developers to feel like they have to be on our platform. We just think that’s unrealistic because Saasu is not going to always be the right product for everyone.
It’s also about paying some respect to the developers and saying we don’t expect you to just be using our platform and our propietary code base to build apps just for Saasu. We have an API and make it as open as we can and give you access to the engine within your capability and resource constraints.
BoxFreeIT: When will Saasu 2.0 be released?
Lehmann: Early next year, before the Saasu conference in April. We’ve got to keep stepping ahead of everyone, and others have nearly caught up because they have thrown a lot of money at building their software. But those products all date when we release our product.
You have to keep reinventing yourself. Your IP stales very quickly in this space.
Part 2 tomorrow: Ecosystem will be the secret to success