When Invitbox sold to Intuit in 2013 it was one of the earliest successes from the SMB app ecosystem. Brothers Roger and Chris Gregg had built up their hospitality focused accounts payable app by door knocking pubs and hotels across Australia.
In those early years, when cloud accounting software was a relatively new concept, online business apps were also a hard sell. The halo effect of belonging to the Xero and Intuit ecosystem didn’t count as much as sweat equity.
Xero had bought Paycycle and Workflow Max in the years before, there were rumours that it would expand to accounts payable – and Receipt Bank was the leading app. Invitbox’s sale to Intuit was well celebrated.
Roger bought the Carrington pub in Sydney with the proceeds and joined the trade he had serviced. Chris went to work for Intuit helping other ecosystem apps tackle the Australian market.
In the meantime, Intuit kept operating Invitbox for existing customers but chose not to invest in selling it further.
And now the Gregg brothers are back. After taking the smarts from Invitbox, Intuit realised it no longer wanted to support a niche app with 2,000 customers and was looking for a way to retire the app gracefully. Rather than buy back a dated technology platform, Chris and Roger built a new one called Lightyear. It will provide a new home for their old customers when Invitbox is finally shuttered.
This time younger brother Chris gets to be the CEO, and Roger is the president (and still publican).
Digital First: Why are you back?
Chris Gregg: The primary motivation is that the sector is huge and the industry is ripe for adoption. That’s the primary reason. Look at the size of the opportunity – 150 billion bills are processed annually. That’s 3 billion bills in Australia, 1,500 per business. It’s a huge cost and burden to the Australian economy. There’s not an offering in the market catering for mid-tier businesses to automate accounts payable.
Digital First: Isn’t automated AP getting crowded? Obviously Receipt Bank, AutoEntry – and now Xero Expenses and the acquisition of HubDoc. How will you stand out?
Chris Gregg: We don’t want to compete with Receipt Bank, Expensify, and so on in SME expense payment receivables.
We are thinking about building out the supply chain side more and specialising in product based businesses. For example, a Receipt Bank-type client but we specialise with advanced approval workflow. Any business that needs multiple locations and approvers. We will build out integrations to point-of-sale systems to send that data to the accounting software and to the inventory systems and saving the double data entry that goes on.
We will look at purchase order matching and ordering from within the map. We may add ordering capability to sync with the supply chain so they can place orders within Lightyear.
Digital First: This is sounding bigger than hospitality?
Chris Gregg: Yes – hospitality is our first vertical. We will work with the hospitality associations, attend the tradeshows and seed that market.
But if you think about what our product does, the core functionality is applicable to other industries. Healthcare, franchises, retail, construction. If you’re ordering products and you need to get data from the supply chain to the inventory system, who’s going to do that job for you?
Digital First: Where are you at with the new app?
Chris Gregg: We exited the alpha in July and are getting ready for migration. Initially we will will do a soft launch and take on customers from the second half of August, with a launch at Xerocon in Brisbane (Australia). Businesses can sign up for a free trial from two weeks’ time when we go into this soft-launch phase.
Then we will run a phased migration over a couple of months. We had an overwhelming response from Invitbox customers wanting to migrate across, but we need to make sure we can deliver a great customer experience.
Digital First: What did your old customers say when you told them about Lightyear?
The reception has been phenomenal. Pretty much every customer apart from two said it sounds great. Roger and I signed up most of the customers so there’s that trust factor.
Digital First: How big is the team?
Chris Gregg: We will have a full field support and service team in the market. In Australia we have hired two business development managers, one in Brisbane and one in Melbourne. We have four staff in Sydney focused on sales, customers success and onboarding and support.
We will have a team of 13 to 15 people in the UK. Our head of sales is ex-PayPal, we are hiring business development managers in London and support staff in Belfast.
Digital First: Will Lightyear have the same functionality as Invitbox?
It will have the same functionality, one for one, with a few nuances. We are adding OCR extraction to handle scanning paper receipts as well as electronic documents.
Digital First: Any other improvements?
Yes, in three areas. It’s a shitload faster. Lightyear is built on microservices architecture on AWS. The older system was a monolith. Now we have the capacity to scale in terms of more business, but also in scaling our development approach. We run a very lean and agile development team here on an aggressive release cycle and a two weekly cadence.
It’s much more user friendly. We have spent a lot of time speaking to customers, getting feedback from a user experience perspective. We have re-engineered the workflow with a lot of tweaks to make it more intuitive.
But we are also trying to keep consistency from the Invitbox to Lightyear product. We didn’t want to reinvent the wheel for our MVP. There are a lot of subtle changes.
Digital First: And what is the relationship between Intuit and Lightyear?
There’s no connection or ownership to Intuit or commitment in any capacity. It’s a totally separate entity that Roger and I own. On launch we will have integrations with Xero, QuickBooks Online, NetSuite, MYOB and ABcom (a Brisbane-based app that specalises in accounting for hospitality chains such as McDonalds). Customers can send their data to Adept, Pronto, Microsoft Dynamics, Sun Systems, and a few other bespoke systems. Will be building a Sage API for the UK launch.
Digital First: What is the deal with Intuit with Invitbox customers, then?
Chris Gregg: Lightyear has agreed to offer an assisted migration from Invitbox to Lightyear in advance of Invitbox shutting down. It’s a win for the customers because they get a continuation of service with an enhanced product, and Intuit has a win in making sure their customers are looked after.
Digital First: … and a pretty major win for you, wouldn’t you say?
Chris Gregg: Well, yes.
Digital First: What is on the roadmap post-migration?
Chris Gregg: There’s a lot lined up. We deliberately want to keep the look and feel consistent initially so the migration is not a shock to users. Then we will start to aggressively build in new feature enhancements.
The first of those will be OCR. We know that today around 90 percent of bills coming to Invitbox are electronic. So we will focus on the electronic component of AP. We also get consistent feedback that there is an element of paper. It’s dying but there is still a need for automatic data extraction from that small segment.
Digital First: I understand it’s a big opportunity, but what got you to come back on a personal level? You already know how hard life can be in the ecosystem.
Chris Gregg: Back in the day we were inexperienced – we had never run a tech company. We could write a book on how to make mistakes. We got to the stage where the money was tight, we were doing funding round after funding round. The space was getting difficult. The talk was about Xero buying Receipt Bank. We evaluated the internal dynamics, the market, the stress levels. [We didn’t sell] because we weren’t having a lot of fun with our customers. We thought that if Xero bought Receipt Bank and then Intuit build it…
Now it’s different circumstances. We are well funded, more experienced and more mature. We have much bigger networks we can tap into around the world.
We’re also doing it in a niche area for self-preservation. If any of the accounting vendors build out a similar solution it will never have the depth for a product based business. It gives us confidence that we can go for 10 to 15 years and the main vendors will never go into that detail.
Corporate life is for certain people and startup life is for other people. We’re in it for startups.
Image credit: Twitter