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<p> Issue 10 / 1 Have you subscribed? Go to subscriptions.xumagazine.com Follow us on Twitter: @xumagazine magazine The independent magazine for Xero users, by Xero users ISSUE 10 9 772054 722009 1 0 ISSN 2054-7226 the Financial Web is transforming the traditional lending landscape ON DEMAND BUSINESS FINANCE Satago (Latin): to satisfy/pay a creditor Have you subscribed for FREE? Go to subscriptions.xumagazine.com Satago’s Steven Renwick explains how COVER STORY 2 / Issue 10 Issue 10 / 3 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine workflowmax.com/xero ALL-IN-ONE PROJECT MANAGEMENT SOFTWARE Powerful Job Mobile app 30+ Integrations 4 / Issue 10 Issue 10 / 5 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine magazine Issue 10 CEO: David Hassall (Co-Founder) Managing Editor: Wesley Cornell (Co-Founder) Strategic Partnerships: Alex Newson Staff Writer: Bethany Cox Editorial/News Submissions: If you have any editorial content (news, comment, tutorials etc.) that you would like us to consider for inclusion in the next edition of XU Magazine, please email us at 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 2014-2017. 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: 12 Jordan Street, Liverpool, L1 0BP, United Kingdom. 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. The independent magazine for Xero users, by Xero users 6 / 2017 Up and Coming Tech 8 / Explained: Xero Partner Program Points 9 / TUTORIAL - Provide Management Reports to Clients Without Breaking a Sweat 10 / FEATURE - On the back of a beer mat: XU Magazine from start to Issue 10 14 / Top tips for setting up your own cloud business software advisory service 16 / INTERVIEW - Q&A with Michael Wood from Receipt Bank 20 / COVER STORY - How the Financial Web is transforming the Welcome to issue 10... Try invoice reminders at satago.com Make your cash flow with Satago, your all-in-one cashflow soluuon. Spend less me chasing customers with our automated invoice reminder system. Complete Cashflow Confidence Accessing short term finance to bridge cashflow gaps can be difficult as a small business. I needed a way to access the money locked up in my unpaid invoices. Then I found invoice finance from “ “traditional lending landscape 22 / From rock music photographer to helping businesses develop 24 / Why philanthropy matters: your small business guide to giving 28 / COMPARED - Time & attendance App comparison 30 / TUTORIAL - Streamline your invoicing with WorkflowMax… and get paid faster 32 / 5 silly excuses we give for not going paperless 34 / TUTORIAL - How to: using reports in ApprovalMax 36 / New business in the UK reaches record high 38 / Move to high-tech, high touch and watch your billable hours grow 40 / A systems-based approach to delivering client work 42 / ANNOUNCEMENT - Accountex returns 44 / TUTORIAL - How to use MinuteDock for time billing with Xero 46 / CASE STUDY - How simple process automation helped increase efficiency & growth 50 / A new year, a new global economy, and what that means to the Xero community 55 / TIMELINE - Innovations to help you thrive in 2017 62 / The ideal client: choosing the right clients and delivering valuable customer service 66 / TUTORIAL - Dryrun: help your clients build a powerful recurring budget… 70 / The all-new Xero HQ 72 / Small business expansion: how to ensure compliance in Africa 74 / Forget me not: the automated Xero feature that’ll get you paid on time 76 / TUTORIAL - AutoEntry: advanced, feature-rich automation of data entry to Xero 82 / Introducing mTrio 84 / Mindset over money: why spending more on marketing is not the answer 86 / INTERVIEW - Q&A with Will Lovegrove from pensionsync 90 / Reconciling various customer payment methods: get organised by separating your deposits 92 / Alleviating reconciliation ailments 94 / Does your accountancy firm serve others or does it serve you? The 7 systems that are changing the game 98 / Top tips for Xero users: Budget Manager 100 / Mitigating risk and making data security a top priority 102 / NEW RELEASES - Updates and new releases: from the Xero App Marketplace 106 / Taking the ‘auto-magical’ to the next level 108 / Get ready, set, go! The importance of a good set-up 110 / APP DIRECTORY - App/ Service Directory 118 / Apple Pay is here! 6 / Issue 10 Issue 10 / 7 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine Up and coming tech So what are the up-and-coming technologies of 2017? Accountants and small businesses, listen up for tech trends according to Xero! mall businesses have the flexibility and creativity to take advantage of the power technology holds to make our lives easier. They can quickly adapt to use new technology by staying lean and agile. If they are savvy enough, they can make the best of technology whilst averting the associated risks by adopting early but being cautiously observant. Here’s are the trends to look out for... Chatbots, AI and Machine Learning Artificial Intelligence in not, by all means, new this year but it is being used in new and exciting ways. AI is the simulation of intelligent behaviour in computers, and its ability to think for itself. Machine Learning is a type of AI, involving computers learning without being explicitly programmed. Chatbots are designed to use this to make intelligent conversation. This is already being implemented in apps such as Slack, where users can interact with Slackbot. You should look to use apps that use AI to organise content, data and products. BYOD and MDM The International Data Corporation has forecasted that in 2020, almost 75% of the workforce will be mobile. The knock-on effects can be hugely beneficial for companies but may also increase vulnerable data (like sensitive and private customer information) for those who have a bring-your-own-device (or BYOD) policy. Having one device that is stolen may put huge amounts of company data and security under threat. Data silos are the solution to this increasing problem. They are a data segregation fix; a separate database to the business-wide system. Data for each department or employee is isolated from the rest of the company. Mobile devices are commonly used alongside mobile device management (MDM) in businesses. These systems work alongside company policy to enforce security and activity management of employees. MDM is starting to appear as an intrinsic part of some apps, for example Safari allows you to bookmark URLs that require you to access them through a VPN. Despite thinking that this is a large company-only problem, small businesses are those who cannot afford the dangers of security risks. Remote offices We’ve all heard of the stereotype of remote workers of participating in video calls in a shirt, tie and pyjama bottoms, but other than comfort, why are remote offices catching on for workers and employers? Whilst some may say lack of routine is the downfall of remote working, the increased flexibility is the perfect starting point for some to thrive. Some people just work better when they have the freedom to manage their own schedule, and are working at a pace set by them. We can’t ignore the cost impact remote offices have on both staff and companies. Despite there usually being some initial setup costs, your company saves money on real estate in the long term; money that can be spent on expanding your borders geographically. Your employees save time and monetary costs of commuting, and buying lunch and coffee and that expensive business- casual wardrobe. It has been shown that fewer sick days are taken by those who work from home. How often are you sent home by a sore throat or something that doesn’t necessarily limit your ability to work but means you can’t be in the office? So why is this something to consider now? Well, technology is better than ever and allows effective communication between off and on-site workers. Collaborating live on shared documents, high-speed internet, and even doing more with your good old email. Technological advances make so much more possible. Plus, no distractions of colleagues and cake means no more interruptions so you can get your work done on time. E-commerce With projections for E-commerce sales in 2020 of $4 trillion, small businesses need to jump on this bandwagon if they see a future for their company. Quicker searching, one-click transactions, next-day delivery, not even having to leave your home once. It all comes down to time, for both business and consumer. Increasingly, buyers are looking to only purchase products that can be delivered, so put your products out 2017 there on your site. Connection-as-a-Service The past few decades have seen servitisation become the business- model of envy. More and more companies are transforming and developing their systems to include services that complement and even supplement the products they offer, moving from a product-centred to customer-focussed approach. This values the customer and their needs, giving businesses who have adopted this approach the competitive edge against rivals. Small businesses should take advantage of this by embracing XU Readers: We’ll add an extra 30 days to your free trial! Forecast Cash Flow, Budget & Sales Scenarios Sign up today at dryrun.com/xu S partnership with connection services to boost accessibility of their products to customers. Subscription-based business Subscriptions are another win-win that are taking over in all kinds of industries. Customers have an easy way to renew services or products orders and know consistency. Having recurring monthly income helps businesses budget, project and report more easily. This model is at its best when partnered with e-commerce and automated payments. You can almost certainly combine these in your business. Influencer marketing With the swell in social media, instead of looking to companies, consumers look to their peers to apprise decisions of product purchase. Famous personalities on media platforms now command the opinions of their followers, making them the big target for advertising products and services. Your customers want to feel talked to rather than at, being fully informed and educated about your product. Companies the world over have increased budgets specifically for social media for this year...perhaps it’s time for you to as well! 8 / Issue 10 Issue 10 / 9 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine Explained: Xero Partner Program points ost of you by now will be familiar with some aspects of the program, but if you’re searching for the basics, look no further. If you are using Xero, you will have already been notified of your Xero Partner status. For some, your status will have already improved, and for others you will be looking at what you can do to reach the next level. The program is created with the view to make your business a success, based on what success means to your business. Each month, you will be notified with your status, number of points, certifications, distinctions and benefits calculated from the previous month. Benefits The Partner Program offers many benefits to it’s users. Alongside the enriched education resources, Xero shop, available practice tools and profile in the Advisory Directory on offer, Xero Partners benefit from the following: • Access to Xero HQ - for managing clients • 1 subscription to Xero - for internal use by your business • Access to Partner-only info and support from a Xero Account Manager Xero Champions Xero Champions add an extra distinction to Partners with the title. The criteria for Bronze Champion status are as follows: • Bronze Partner status level • Earned 10 more points in the past 12 months • At least two Xero-certified staff • Those for Silver, Gold and Platinum Champion statuses are: • Silver, Gold or Platinum status level • Earned 20 more points in the past 12 months • At least three Xero-certified staff The new and improved Partner Program, launched in November 2016, is Xero’s points-based system for awarding recognition to Xero Partners. The number of points required to be awarded each status UK and NZ - points awarded for each activity AU - points awarded for each activity Provide Management Reports to Clients Without Breaking a Sweat ProfitSee provides the tools that give accountants and bookkeepers the ability to easily automate and grow their advisory services. IT ALL STARTS WITH REPORTING Reporting is an important function of accounting. The value of the reports comes from the advice you provide from the financials. Do you ever find yourself scrambling to prepare your clients reports and thinking, “there has to be an easier way to get these done,”? Let ProfitSee save you time so you can provide the strategic advice that truly impacts your clients’ businesses. 01 ADD YOUR LOGO Upload your firm’s logo to instantly provide client dashboards and reports that match your practice’s brand! Keep the focus on the advice you’re providing, rather than the software you’re using! 02 CREATE CUSTOM TEMPLATES & SCHEDULES Some clients benefit from shorter, more frequent reports, but also still require in-depth quarterly information. Others might want monthly management reports. With ProfitSee we simplify the reporting process by giving you an easy way to create custom report templates, and set automated reporting schedules, so you don’t have to think twice about it! 03 RELAX, REVIEW, & SEND! You can set the reports to send directly to your client, but we recommend having them sent directly to your inbox. This gives you the ability to review them, add any needed commentary, and send them off. Giving you more time to do the advising, while ProfitSee does the tedious work for you. In three simple steps you can create white-labeled and automated management reports for your clients, no matter their reporting needs! Start your free trial! SERIOUSLY, IT’S THAT EASY WWW.MYPROFITSEE.COM/TRIAL M Tutorial 10 / Issue 10 Issue 10 / 11 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine On the back of a beer mat: XU Magazine from start to issue 10 Like all good ideas, it started between the two brothers in a pub back in December 2013. David and Wesley had been chatting about Xero and how all the guides and information were scattered across the web, meaning users had to go and dig around to find everything. It made perfect sense to us to pull as much of this information as possible into one platform. ero has many different features, and there is a wealth of information out there available to its users including blogs, forums, and articles, as well as the ever-increasing pool of Xero’s own resources. As Xero Users ourselves, we didn’t always have time to go and search through this supply. And so we knew exactly what we wanted to create. Our goal was to be informative, topical and impartial, bringing all of the valuable information out there into one place, to save Xero users treasured time and effort. The initial campaign began on Indiegogo, a crowdfunding site for entrepreneurial ideas...perfect for us! This was the start of our journey to equip the Xero community and draw it together. Our aim was simple: to create a magazine for Xero Users, by Xero Users. XU Magazine CEO, David Hassall: Both myself and Wesley are avid readers of user magazines for various other platforms, so the idea was born. Why don’t we do a user magazine for Xero users? With neither of us having publishing experience we dived straight into Google. As soon as we had built an original concept of what we wanted from the magazine, we decided the best platform to launch this would be via crowdfunding as we needed both cash and visibility of the product. A few days into the campaign we knew the idea was a winner and that really encouraged us. It was a long slog as we worked full time on the campaign, keeping up with 4 time zones as well as our day jobs! Once we had funding and a great following we then took to Google again: how do you actually make and design a magazine? After numerous YouTube tutorials, and friendly people helping us out, Issue 01 was born. It was much harder than either of us ever realised it would be but we were so glad when we got there. The icing on the cake was Chris Ridd inviting us to launch at Xerocon over in Australia. Since that initial pub talk, we’ve come far. Along the way, we’ve made mistakes but have learnt a mountain of lessons to take forward with us. Our independence from Xero and its Add-ons (now Apps) ordained that we would become the unbiased information source for all with a login to Xero. But although we’re independant, Xero have been an amazing support and sounding board for us, so a big shout out goes to all of their staff who have helped us on our journey...we of course wouldn’t be here without Xero in the first place! XU Magazine Editor, Wesley Cornell: Some of the biggest releases from us have been in the past few months. Our digital reader and subscription system have gone hand-in-hand in bringing the mag to a larger audience. Together they mean that anyone can sign in and be welcomed into our community, with full access to all content from print, and more. And all for free! There are lots of ways we’re looking into growing this in the near future. We have some other really exciting developments coming up over the next year for XU Magazine...so watch this space! XU Magazine Head of Advertising and New Business, Alex Newson: We’ve been learning a lot of new stuff, so it’s almost like working on Issue 01 again. The fact that we’re now on Issue 10 is staggering. We want to say a big thank you to all our contributors and advertisers for getting us here. As always, we value the honest and reliable feedback from the awesome Xero community. Let’s keep building it together! We’re delighted to be exhibiting at all Xerocons over the coming year. Keep a look out for us there, we look forward to seeing you. Certain Apps that connect to Xero have been an integral part of our journey and we want to recognise and celebrate the friendships we have formed with them. From the outset, TidyWork have connected with us. We asked them to share more about how we started out together. Kevin Mann at Tidywork: “What amazing vision!” we at Tidy thought when Wesley told us about starting XU Magazine. We instinctively knew Tidy had to support it. Xero and the Add-on community had grown so much, it was great to see a publication representing the stories of this exciting cloud ecosystem. We felt he must really believe in the future of Xero and others like Tidy building connected cloud products. It meant a lot to us at Tidy that someone in the UK, miles away from the birthplace of Xero would start a global publication like XU. A printed publication in a cloud world? We thought most global users were not (yet) cloud converts, so needed an offline medium. In less than 5 minutes Tidy confirmed we’d take out a full-page advert and help XU with well- deserved financial support. We’re privileged that Tidy has continued to travel with XU in all ten brilliant issues. Profitsee have supported us right from the word go. We’ve spent time with them at various conferences, and even visited a zoo together! Brooke tells us more... Brooke Roberts at Profitsee: ProfitSee has worked with XU Magazine since it’s first edition. We were so excited to learn about it through their funding campaign, that we couldn’t wait to get involved. Over the past few years, I have worked closely with the XU Magazine team, and they are great partners to work with. From article submissions to artwork suggestions, they have been responsive and helpful. Each issue seems to top the last, and we’ve really enjoyed their platform as a resource to help educate Xero users about changes in the global accounting industry. One of our highlights has been getting to know the team at Minute Dock over the past couple of years. We’ve done some really cool stuff together, from watching the rugby to visiting a Koala Sanctuary! Jared Armstrong at Minute Dock: I saw their original crowdfunding campaign and thought it was an interesting idea. I reached out to them to write an article for their very first issue and they’ve been awesome at including MinuteDock since then. We had a blast travelling to the various Xerocons last year and catching up with their team at each one. Seeing how passionate they are about providing a really great publication for Xero users is really inspiring. I love reading every issue and keeping up to date with the Xero community. Deputy is a big name in the business and they have been right alongside us since Issue 01. We asked them to tell you about our relationship. Kristen Harris at Deputy: The Xero partner eco-system is one we value highly at Deputy so when we first saw XU Magazine emerge with their cheeky crowd-sourcing venture we were happy to jump in and support them. That experience has resulted in a consistent, reliable and professional relationship, one we know we can trust for great content and good reach amongst the members. I look forward to our relationship continuing for many years. A really valuable link for us is with the Receipt Bank crew. They’ve given us some great experiences when we’ve met up including celebrations in London, a hog roast on a barge, and a rooftop party in Brisbane. Michael talks about their journey with us so far... Michael Wood at Receipt Bank: The success of XU Magazine demonstrates the unique passion of the global Xero community. As huge Xero fans ourselves, it’s been a pleasure to take the journey with the team, whether it was racing to grab the latest copy at a Xerocon, or my taking part in my first ever cover story. Standing beside Colin Hewitt from Float and Steve Renwick from Satago, all in our kilts, it was clear that the XU team were onto something special and we’ve loved being a part of it. Founders David Hassall and Wesley Cornell Kevin Mann and some of the Tidy team appeared in XU Magazine Issue 06 Team ProfitSee with XU Magazine enjoying Accountex 2014 David and Jared at the Koala Sanctuary after Xerocon South 2016 At Accountex 2014 with Deputy Feature Feature X 12 / Issue 10 Issue 10 / 13 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine Do you remember fruit and veg featuring on our front cover? The XU team had a fun time shooting for the cover of Issue 07 with Advance Track, and having lunch together. Vipul Sheth at Advance Track: We are delighted to have been involved with the XU team almost from the start of their journey. Xero is changing the way accountants work and XU are part of that community. We have enjoyed working with XU, including a fun photoshoot in Leicester Market holding bowls of veg a few days after Leicester won the Premiership. This took me back to my days of working on a leather stall on markets as a boy. At least the sun was shining that day compared to my distant memories of markets! Many congratulations to the XU team and keep up the good work. INNOVATION FOR EVERY CHALLENGE. What cutting-edge products or services will help you work smarter, evolve your business, win new customers and make more money? Find your answers at Accounting Business Expo, a two-day blizzard of new ideas, problem solving solutions, cost-saving resources, quality learning and networking. Join thousands of your peers and future business partners at the essential business event for forward-thinking professionals. Get your FREE TICKET (save $60), by registering online before 20 March. To register, or for more info, visit AccountingBusiness.com.au Use code: XU17 • Free access to 100+ exhibiting companies • Access to 100+ complimentary learning sessions • Learn from 120+ authoritative speakers • Choose your favourite topics across 6 theatres • Opportunity to earn valuable CPD points • Experience non-stop technology demonstrations • Discover the latest technology for your business • Learn how to survive disruption in your profession • Make new connections with industry peers EVERYTHING TO GAIN. NOTHING TO LOSE. WOULD YOU KNOW A GOOD IDEA IF IT SMACKED YOU IN THE FACE? 21-22 MARCH 2017 ICC SYDNEY EXHIBITION CENTRE HERE’S A GREAT IDEA. Find everything you need for your business and professional development at Australia’s biggest, free-to-attend, independently run, business exhibition for accountants, bookkeepers and finance leaders. YOUR CUSTOMERS DEMANDS ARE CHANGING - ARE YOU? LEARN HOW TO ADAPT AND SUCCEED AT ACCOUNTING BUSINESS EXPO 2017 XU Magazine A4.indd 1 25/1/17 4:02 pm More recently, we have worked closely with AppsForOpps and are thoroughly enjoying the partnership that is forming between the teams. Shaun Leisegang at AppsForOps: It all started with a simple Tweet. Very soon after AppsForOps got Cover stars of Issue 02: Michael Wood (Receipt Bank), Colin Hewitt (Float), Steven Renwick (Satago) Vipul Sheth, cover star of Issue 07 approved to get listed on the Xero add-on App Marketplace we decided to sign up to exhibit at Xerocon San Francisco and Xerocon South. Alex saw that AppsForOps was attending Xerocon South and reached out with a simple Tweet introducing himself and XU Magazine. The rest they say is history: from a double page advert in Issue 08, to the front cover on Issue 09 and many exciting things planned for Issue 10 and beyond. We love working with the team at XU Magazine. We as a team have wholly loved reflecting on where we started and are so proud of how far we’ve come since. XU Magazine are so thankful to all those who have supported us so far and continue to do so. There is so much more coming up: brand-new segments, ingenious tech and fresh ideas. We can’t wait to see where the next 10 issues take us. Our pink team will keep flying around the world to bring XU to the Xero community! David and Alex at breakfast in Brisbane with Shaun and Hennie from AppsForOps Feature 14 / Issue 10 Issue 10 / 15 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine Top tips for setting up your own cloud business software advisory service raditional Accountancy training continues to fall short of addressing the diverse role accountants will be required to fulfill as clients become more aware of the efficiencies cloud systems offer. With companies like WorkflowMax and Cin7 advertising directly to the end user, Xero accountants are finding themselves struggling to meet client expectations as they come looking for advice on operational apps. Although some Xero practices are seeing the opportunity to offer a business systems advisory service, many are struggling to get to grips with the world of apps. This is no surprise as it takes time and research to understand the nuances of competing apps and have the confidence to recommend one over another. Having spoken to many practices around the country, from top 50 firms to the local specialist, the problems are often the same. So how do you overcome these challenges, netting new Xero clients and expanding your offer as other practices fail to embrace the cloud? 1) Getting started Many practices are overwhelmed by the Xero ecosystem. There are simply so many apps that the task of finding the right one to recommend seems enormous. 2) Managing change Plenty of accountants are reluctant to make recommendations due to the potential impact (both positive and negative) new system implementations have on their clients’ businesses – and for good reason. With tech moving so fast, it is difficult to maintain the knowledge to confidently provide advice. 3) Building a different client relationship Accountants haven’t really needed to explain themselves in their marketing activities before, for the most part, businesses know what services are on offer, they just need to know you’re there. When launching a new revenue stream in business systems advice, it is vital to understand how you will market and work with your Xero clients. z 4) Balancing App research with fee earning responsibilities Launching in the business software advisory market takes commitment. The requirement to complete fee earning work often overrides the set-up phase and change projects stall. Because so many firms are experiencing these challenges when launching this new revenue stream, we created the BlueHub CSR (or the less catchy- Cloud Services Retainer). This service is ideal for firms who are providing (or looking to provide) an in-house software advisory service for Xero Apps. It allows accountants to move along a learning pathway to build strong relationships with their Xero @Blue_Hub Matt Flanagan, Co-Founder, BlueHub Matt is an industry-renowned cloud business systems specialist, working in close partnership with forward thinking companies, Xero and Receipt Bank. Matt has over 15 years’ experience in business systems, focusing on change management for organisations such as HMRC and the NHS. Reduce the number of apps by identifying your niche. Being a specialist in a particular area, like hospitality or retailing is the best way to create your business systems advisory service. You cannot understand all the apps for all the clients and keep your knowledge current as updates are released so regularly. You may identify a sector by reviewing your existing client base. If not, spend some time identifying your practice’s strengths and experience so you can choose one that reflects your existing skill set. TOP TIP The nature of cloud accounting is so different to traditional methods that people and internal processes will need to change in line with the new systems and ways of working. This is true of the function they perform and their mindset towards it. Practices are having trouble managing change within their teams, as the industry has seen little change for such a long time. If you are unable to find suitable advocates within your team, it may be necessary to recruit new members who are already aware and keen to embrace cloud technology. Their mindset needs to be suited to a higher degree of risk, operational priorities of clients and be comfortable giving advice in a fast moving environment. TOP TIP You will need to carry out a ‘fact find’ to gather information on your client’s business activities and processes. This is a whole business review, looking closely at the way the business operates, the current systems they have (whether electronic or manual) and who does what. This is where you gain the insight to offer Apps that will enhance productivity but that can be integrated with existing systems and that will tick all the requirements for the client now and in the foreseeable future. Marketing is also benefitted from niching down (tip 1), as these pre-selected Apps can be marketed to both new and existing clients, allowing practices to get the most use out of the time they have invested in learning these new systems. TOP TIP Like any new business, the investment at the start makes a difference. Being able to give it your undivided attention, or at least a significant chunk of your week, is essential to put in place the processes and research the market. If you are unable to persuade practice partners to release time to establishing the revenue stream, it may be better to partner with an advisory service like ourselves who can be your port of call when you need expert knowledge to solve a client’s question. You can gain the knowledge of the Xero ecosystem while earning from business process reviews for your clients. TOP TIP clients, gaining knowledge about the ecosystem and having the confidence to offer advice without needing to pass the client to an external company. This allows firms to fulfill a fee earning role while moving their practice into the future. The CSR has three tiers to accommodate for firms of all sizes. Each includes consultancy time with our experienced cloud team, access to a bank of educational resources to support your cloud journey, along with regular meetings and exclusive member-only events. The world of accounting is a changing landscape, shifting from bags of receipts and unfilled invoices to automation and artificial intelligence. For those firms that are tackling the change head-on, the Xero ecosystem has an overwhelming range of add-on Apps. T 16 / Issue 10 Issue 10 / 17 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine Q A & Michael Wood from Receipt Bank XU: It’s great to be joined by Michael Wood, the Director of Receipt Bank. The last time we spoke to Michael was in Issue 02, so we’re delighted to be catching up with him again. Michael, could you start by telling us a bit about Receipt Bank’s journey to where you are now? MW: I have the advantage of being one of the first people in the world to use cloud accounting. So in around 2007, I had a limited company and I was using cloud accounting. I didn’t know I was one of the first, I wasn’t doing it to be enthusiastic, I was actually doing it because I’d made such a mess of my accounts that my accountants had taken my existing package away and said, “try this, you’re less likely to muck it up”. And so I started using cloud accounting very early. And having used it for sort of 1 year, 2 years, 3 years, I really loved the whole thing. But I just realised that there were a few problems. One of the big problems was that suddenly, it had become very ambiguous as to who was doing my daily bookkeeping. So I decided to use my influences and look around for a software solution that could help me deal with the accounts payable expenses. I came across a service called Receipt Farm. It was a postal service at the time in 2010 and what they said was “post us your receipts and your invoices and we will scan them and extract the data for you”. So I thought, ‘well that sounds really good and will really help’ and so I started the free trial. I really enjoyed the service but it had two key problems. The first was that my accountant couldn’t access my data and therefore be an administrator of the account. And equally it didn’t send the data straight into my cloud accounting package. I wrote into the customer service guys to say “I love what you’re doing but these are the two issues I’ve got”. They came back to me to say ,“Mr Wood, thank you for your feedback but unfortunately we’re closing down today”. So I wrote straight back to say, “can I buy the service?” and that’s how Receipt Bank started! XU: That’s interesting that it was the day that you rang up that they were closing down... MW: Well exactly, and the background to that was that I’d helped to build a significant accounting package in the past and I’d run other businesses so I knew the small business accounting process and business really well, and I saw how big and important cloud accounting was going to become, and actually realised that automation was going to become a huge part of that and so we started Receipt Bank to help accountants and bookkeepers to help automate bits of the process. XU: A lot of Receipt Bank’s journey links in with the advancement in the Fin Tech industry. How has this advancement helped Receipt Bank grow? MW: Absolutely hugely, the first key technology advance that has changed the power of our service is actually smart phones in Receipt Farm as it started out as a postal service. So suddenly the popularity of the iPhone and Android allowing people to take photos of receipts there and then made a huge difference. Receipt Bank also was a very early investor in AI, and our data extraction technology is heavily AI-based. There still are some humans supervising the most difficult of invoices, but primarily it’s an AI service, so that’s been a huge benefit. And there’s various others. As I say, our job is to provide automation and so there’s various trends we have served. XU: In contrast, has Receipt Bank helped the Fin Tech industry grow? MW: I don’t think we have yet, what’s happening is a lot of people in financial services are excited about the cloud accounting industry because it makes this incredibly important data set more available. Now whether that’s more available to the bank, whether that’s more available to the lender or insurer or whoever it may be, there’s some fantastic data that’s been made available by cloud accounting. Of course for that data set to be valuable, it’s got to be up to date. And that’s where Receipt Bank is absolutely key because Receipt Bank is the key software out there that is used by accountants and bookkeepers and small businesses to make sure their data is up to date. And the more up to date it is, the more valuable it is. So that’s the way that we will contribute to that. XU: Definitely, and Receipt Bank and Xero come hand-in-hand from my experience. So over the next few years what shifts do you think we will see in the current trends of technology in the Fin Tech industry? Do you see any patterns emerging? MW: What I expect to see is the emergence of what I call “accounting centaurs”. And I do mean centaurs as in Harry Potter, mythical creature, half- horse, half-man! There’s a really interesting story I think is useful for all accountants and bookkeepers to be aware of. I think everyone has heard about IBM software, Deep Blue beating Garry Kasparov at chess in 1997. It was really famous and made headlines all around the world: a computer’s AI beating a man in a really key way, and that was the headline everyone took from it: AI beats very clever man. Now what everyone missed is actually what happened afterwards. Garry Kasparov recognised that although he lost to the Deep Blue computer, the Deep Blue computer wasn’t just artificial intelligence; it had a database of chess moves. It had all sorts of other computer advantages attached to it. And afterwards he created a new type of chess called “centaur chess”, and the whole point of centaur chess is that you and I might be playing each other and as we play Interview Interview 20 / Issue 10 Issue 10 / 21 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine How the Financial Web is transforming the traditional lending landscape Steven Renwick, CEO of business finance firm Satago, one of Xero’s first financial services partners in the UK, explains how a new breed of FinTechs has emerged to transform the SME funding landscape... isruptive innovation designed to break the stranglehold of dominant business models shows no signs of abating. Netflix, Amazon, Uber and Airbnb are the doyens of the on-demand economy as we know it today, inspiring entire generations of technology- driven businesses to challenge established models and strategies. Indeed Xero itself allows business owners on-demand access to financial information that would previously have been siloed within inaccessible desktop accounting software. However, the financial services industry, long overdue radical transformation, has been slow to embrace (or arguably quick to resist) this form of disruptive thinking. When I started to look at the SME finance market, I was pretty shocked at how little the commercial finance industry had changed. Traditional lenders may now offer multi-channel delivery, including mobile, tablet, instant messaging and webchat, but when you peel away the veneer of digital delivery, the products haven’t altered fundamentally for decades. SAP’s Digitalist Magazine recently said: “There is a lot of talk about digital transformation by banks, but the reality is that – despite what they say – they are not doing it. What the vast majority of banks are actually doing is digital enablement. They are simply using digital technologies to do what they are doing today, only slightly better. There is nothing transformational about what they are doing.” The key imperative to market disruption is to re-imagine a new ecosystem that meets the needs of the customer, not the lender. Critical to the development of this new ecosystem is the access to data afforded by cloud-accounting software, such as Xero. For far too long the focus has drifted the other way, fostering an environment in which big bank rules have prevailed unchallenged and facility limits and ceilings have continued to restrict the growth of SME businesses. Selectivity is the key Traditionally, banks have been the primary source of working capital funding for SMEs. However, regulation has meant that increasingly these large financial institutions have to be very selective in terms of the companies to which they will provide funding, regrettably leading to the exclusion of many small businesses. Basel III regulation is putting banks under growing pressure to maintain higher capital ratios as they look to rebuild their capital bases and de-risk their balance sheets, making lending to small businesses far less attractive to them. This enforced reticence to lend to SMEs is causing huge cash flow headaches for small businesses, especially those that have relied upon bank financing in the past to plug short-term funding gaps. Ironically, this selectivity in terms of underwriting from the large market incumbents has created an even greater choice for SMEs than ever before – in the form of a new wave of nimble, digitally driven alternative financiers, such as Satago. By leveraging cloud technology, real-time data and analytics tools, these new FinTechs are able to provide businesses with fast, flexible and frictionless funding on a scale hitherto unimagined. Here, selectivity has a positive part to play. For many years, the only invoice finance options available to businesses have been based on a ‘whole sales ledger facility’, in which they are locked into a contract and the attendant fees – which can prove a very costly form of working capital indeed. Today, through leveraging cloud technology, business owners are able to obtain access to cash (previously tied up in approved invoices) instantly on demand – on a selective basis. Unlike before, they are now completely free to decide when and how much they borrow, and for how long; giving them greater oversight of costs and far more control over their borrowing. The Financial Web The game-changing technological advancement that has driven this level of finance innovation has been termed the “Financial Web”. In summary it is the ability for finance providers to seamlessly integrate their applications with leading business accounting packages, such as Xero. Small business owners can now authorise and securely share their financial reports with business lenders, such as Satago. Connect, click, cash: It really is that easy for businesses to access the working capital SMEs need instantly, 24/7. Thanks to the Financial Web they can simply choose the invoices they want to finance and they are paid on demand. Harnessing cloud technology to improve financial health Funding on demand is not the only digitally-driven transformation on offer. Alternative financiers are also harnessing cloud technology to give smaller businesses tools that will help them get paid on time. Satago’s enhanced credit management tools are already succeeding in improving the financial health of small businesses, reducing the time they spend on credit control by up to 80%. This provides the same level of sophisticated credit management and dashboards to SMEs as their far larger competitors, effectively levelling the playing field. It allows for real-time cash flow monitoring at a glance, as well as greater risk @SatagoHQ Steven Renwick, Founder and CEO, Satago Steven founded Satago after experiencing late-payment in his family business in the construction sector in Scotland. In a previous life he was a research scientist with a PhD in Genetics. D oversight and management. When you consider that the deaths of 50,000 businesses in the UK through late payment could be avoided every year – this is a vital innovation. In the face of falling access to traditional lending, SMEs can be assured that there are now better alternatives; agile FinTech-based options designed to offer business owners flexibility and control without the overbearing constraints of their predecessors. Now on-demand business finance is a reality, business owners can focus their energies on what is most important in their lives – fulfilling their business ambitions. Cover Story Cover Story Try invoice reminders at satago.com Make your cash flow with Satago, your all-in-one cashflow soluuon. Spend less me chasing customers with our automated invoice reminder system. Complete Cashflow Confidence I recently lost money when a customer went into administrauon. It dawned on me that I'd never really known who I was doing business with. Then I found credit reports from “ “ 22 / Issue 10 Issue 10 / 23 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine From rock music photographer to helping businesses develop Life on the road with David Lloyd Williams of Principality Consulting... Years ago, when I was an apprentice, I used to take my camera and take photographs of the big bands that came to the North Wales theatres. It was all in black and white and I used to develop it myself and send the bands some pictures. Eventually I took a photograph of Queen, sent it to Brian May and he stuck it on his website. I was pretty pleased with that.” These days, David Lloyd Williams has turned the keen eye that once photographed travelling rock guitarists towards helping businesses run more efficiently. As Managing Director of Principality Consulting, he helps companies find IT solutions that will improve their businesses. Finding efficiencies to support business success “I enjoy finding a business, applying some lean principles… improving the way that business works, and locking in the improvements we find with some software which can make sure that the gains we find can be sustained throughout the life of the business,” David explains. His consultancy services cover everything from accounting and financial systems, to fully integrated ERP systems for larger companies. The lean principles that David talks about apply to a method of business improvement originally invented by Toyota in Japan. The method has spread from the automotive to the manufacturing industry and is now used by many kinds of business to drive efficiency. In his role as a consultant, David has found lean methodology very effective: “We tend to find that for every pound of consultancy that we give a business, we can save them £10 a year in efficiency savings.” Bringing a redundant site back to life One of the companies that David works with is Professional Fabrication Services (PFS Ltd), an engineering and fabrication company in Holyhead, North Wales. The company was set up following redundancies at the aluminium smelter in the town, where David himself used to work. “I went off and started my own business, and one of my colleagues, Martin Davies, started his own business, in metal fabrication. We came together again at a meeting, and it seemed I could help him improve his systems. I mapped his work process, looked at what he did, what he needed and then came up with a number of recommendations.” With help from former owners of Rio Tinto, three former employees of the smelting plant, including Martin Davies, set up metal fabrication company PFS Ltd. They now work out of the old engineering workshop that used to serve the plant and employ 16 people. Recommended software After looking at all the different @I_am_wordstruck Michelle Nicol, Freelance Writer, Wordstruck Writing and Training Michelle is a freelance writer, trainer and tone of voice consultant who helps businesses tell their story using words that connect with their customers. A former BBC journalist, she also provides business and creative writing workshops. processes within the business and assessing its needs, David recommended that PFS Ltd use cloud-based project management software TidyWork. This solution gives the company greater visibility of the profitability of their different projects and integrates with Xero to provide the lowdown on their financial figures. Although still in the early days of implementation, the software is already having a positive impact, as David explains: “They’re already seeing a number of improvements. Martin can see now what projects are making a profit, what projects are not making a profit. Previously although he had a gut feel, he couldn’t put a figure to it.” “All the time expended on any project, all the materials being expended on a project, everything goes into the project on TidyWork, so there’s a figure for everything,” he continues. “He’s now starting to make business decisions on some projects, that maybe they shouldn’t be doing because they won’t make money.” Working in the cloud Because David’s consultancy takes him to customer sites all over the UK, he understands the flexible advantage that cloud-based working offers to businesses, including his own. “Cloud has changed everything,” he says. “Principality don’t have an office anymore. We just have cloud-based systems. We share information using the cloud. It’s meant that we’ve reduced our fixed costs because we don’t have offices and we’re able to get out a lot more and meet more customers.” Life on the road Visiting customer sites and offering advice and consultancy takes David from Fort William in Scotland to South Wales and many places in between. As well as helping businesses work more efficiently, travelling by rail and road does occasionally allow him to indulge his love of photography: “As I’m travelling, I might see a nice picture and stop to take it. Phones these days are fantastic. You have your phone with you wherever you go and they take fantastic pictures. So, not so much band photography any more, but I do still take pictures.” “ 24 / Issue 10 Issue 10 / 25 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine Why philanthropy matters: your small business guide to giving Social responsibility initiatives offer profound benefits for small businesses and the communities they care about. Better yet, they don’t have to cost a fortune. Caitlin Sisley explores some budget friendly possibilities, and the positive flow-on effects of inspiring a ‘culture of giving’ within your business... 016 was a strange and unsettling year. As a global community we were brought to our knees by shocking political events, civil unrest, extreme earthquakes and the devastating crisis in Syria. We wept as many of our beloved musical icons passed away - including Bowie, Prince and Leonard Cohen. The year as a whole left many of us feeling shaken, in need of a hug and a stiff drink. In the wake of this turmoil and sadness, how we treat our fellow humans in 2017 seems more important than ever. I hope we see a renewed focus on community and caring. I hope more people start embracing humanitarian ideals on both a personal and professional level. It’s time to bring compassion, empathy and generosity back into our daily lives; and small business has an important role to play. Corporate Social Responsibility We’ve all heard of Corporate Social Responsibility (CSR), or a regime of corporate contributions intended to improve the wellbeing of communities. The term is usually reserved for big entities with loads of cash and entire marketing divisions, performing grand charitable gestures to boost their profile and impress stakeholders. But as a small business, CSR doesn’t apply to you, right? You simply don’t have the same resources as a corporate entity. You’re strapped for time every day as you juggle family commitments and entrepreneurship. Every expense - financial or otherwise - needs to be justified. How can you commit to charitable giving and social responsibility when you barely have time to pay taxes? The Small Business Advantage Funnily enough, there are actually several advantages small businesses have when it comes to corporate social responsibility. Firstly, as a small business you’re flexible. You can respond to urgent community needs or perform spontaneous charitable actions without getting embroiled in miles of red tape. You don’t answer to a rigid panel of stakeholders or figureheads. You get things done. Secondly, as a small business owner I bet you’re already passionate about making a positive impact on your community. What’s more, you have local connections and are well-informed about relevant issues. It won’t take as much research for you to pinpoint the areas where you can make a difference - and the local issues you choose will be close to your heart. With that in mind, here are some budget-friendly suggestions to get you started on a social responsibility plan. It’s by no means an exhaustive list, but more of a starting point to get your creative juices flowing. • Offer Free Marketing. Aside from direct donations, free marketing is one of the simplest ways to support a local charitable organisation. However, poorly selected campaigns can appear superficial and opportunistic - so it’s important to choose a charity that genuinely aligns with your company values. Offer them marketing space on your website, email newsletter promotions, or even your pro bono services. Over time you should be able to cultivate a mutually beneficial partnership. • Give Blood as a Team. Encourage your staff to participate in the essential, life-saving activity of donating blood. Most services (including NZ Blood and Australian Red Cross) will visit your workplace if enough staff members sign up. You may even be notified when your blood is used to save a life. A single donation can save the lives of up to 3 people, and you can donate every 3 months (or 2-3 weeks for plasma donations). Imagine the potential impact your company could have just by implementing a quarterly donation scheme. • Support Your Local Refugee Centre. There are many ways small businesses can help refugee centres, aside from direct donations. You could organise a regular donation drive for employees to bring in clothing, books or unwanted gifts. Some companies choose to lend their office space after-hours for refugee language classes and employment training. It’s a powerful way to help those less fortunate than us to build better lives, and in turn give back to the community themselves. • Host a ‘Buy 1, Give 1’ Lunch. Here in New Zealand there’s a wonderful social enterprise called Eat My Lunch, which operates on the ‘buy one, give one’ philosophy. For each packed lunch you buy, they’ll donate a meal to a local school so an underprivileged child doesn’t go hungry. It’s an inspiring business model. Consider using their service the next time you facilitate a staff lunch, or adopt your own ‘buy 1, give 1’ approach to catering. • Enter a Sports Event. There are many opportunities to make a difference by entering your staff in sporting events like Oxfam Trailwalker, the London Marathon or Auckland’s Round the Bays. You can maximise their impact by matching fundraising efforts or making product donations in your company name. Last year several Xero employees entered the BDO Wellington to Auckland Cycle Challenge, riding their bikes for seven straight days and travelling almost 800km! • Give Back to the Environment. Businesses of all sizes leave a bigger carbon footprint than individuals, but at least you can minimise the damage. There are thousands of ways your company can show its commitment to ‘going green’. You could implement a company- wide recycling policy, source your materials from local and sustainable producers, or participate in power-saving regimes. Staff volunteer days like native tree planting double as excellent team building activities. • Support Local Youth. Young @WorkflowMax Caitlin Sisley, Marketing Content Writer, WorkflowMax Caitlin has over six years of experience in the digital content world and has worked on social media campaigns, SEO blogs, press releases and creative copy for a large number of New Zealand businesses. With a Master’s Degree in Human Rights, she is not only passionate about business but also corporate responsibility, ethics and humanitarian issues. 2 26 / Issue 10 Issue 10 / 27 Have you subscribed? Go to subscriptions.xumagazine.com XU Magazine - the independent magazine for Xero users, by Xero users. Find us online at: xumagazine.com Follow us on Twitter: @xumagazine people are the future, and Generation Z will face unique challenges in their lifetimes. It’s important that we support their development and encourage them to become changemakers and innovators. You could arrange mentorship for young leaders in your business field or create a rewarding internship program for students. Often these partnerships will offer mutually beneficial marketing opportunities. • Have Paid Volunteer Days. A powerful way of motivating employees is offering them optional paid days off to volunteer at charitable organisations of their choice. This is usually done on a quarterly or annual basis. Not only does it show your commitment to supporting your community, it also helps to empower staff by allowing them to engage with causes they are passionate about. Often they will learn valuable soft skills in the process. The secret to making these initiatives a success is perseverance and consistency. Be selective with causes, choose a niche that fuels your passion (and that of your employees). Then stick to a schedule. A once-off good deed will quickly vanish from memory, but if you work regular commitments into your business model you’ll soon see rewards. The Flow-On Effects You might be cynical enough to ask, “what’s in it for me?” Not only does philanthropy feel good, your business can benefit from a number of flow-on effects when you adopt a robust social responsibility plan. Try free tidyinternaionl.com JOB MANAGEMENT STOCK MANAGEMENT CONSTRUCTION MANAGEMENT MANUFACTURING Users of ” “ TidyEnterprise is making the running of my business something that’s visible and measurable, which before wasn’t always the case. TidyEnterprise gives me data and transparency on two key areas - money that’s being spent and what people are doing. It shows me graphically and with clear data, where we’re being productive, and where we’re not. Martin Davies, Manging Director, Professional Fabrication Services, UK Tidy helps streamline manufacturing: Job + project + stock management P O W E R F U L S O F T W A R E D E L I G H T F U L L Y S I M P L E In this era of social media, reputation spreads fast, and companies that are perceived as humanitarian or environmentally sustainable will quickly earn the loyalty of discerning consumers while differentiating themselves from competitors. In fact, making social responsibility part of your mission statement can boost your brand trustworthiness, increase sales and improve customer retention rates. You may even attract the attention of like- minded investors. And of course, charitable donations are often tax deductible at the end of the financial year. Speak with your Xero certified accountant to learn more about claiming tax rebates or credits. A Culture of Giving Perhaps the most compelling secondary impact of social responsibility is the culture it creates within your company ranks. Today’s workforce are no longer driven simply by paychecks. Increasingly, employees want to do work they perceive as having a positive impact upon the world, or at least their local community and environment. And philanthropy tends to be highly contagious. Implementing social responsibility initiatives from above usually has a trickle down effect, and over time can foster a ‘culture of giving’ at every level of your business. This culture of giving means staff are more likely to offer their time willingly, take pride in their work, share skills, and be generous and helpful towards colleag</p>
