- Technology used in a 100% cloud accounting practice
- Helping clients review future trends
- Where small business owners can look to improve profits
- How add-on solutions can promote themselves to accountants
Subscribe to Episode 15 of Cloud Stories on iTunes:
Heather: Hello, Heather Smith here. Thank you so much for listening to the cloud stories episode today. My exciting news is that we have had 2,000 downloads of this podcast, which is extremely exciting, so thank you so much if you’re one of those people who has downloaded and listened to the podcast, which you would be as you’re listening to me right now. If you could, it would be great if you know someone who could benefit from listening to this podcast, if you could share it with them. It seems to be quite an education. I’m actually educating people how to actually download the podcast and find it on their iPhone, which sort of has been quite interesting technically to explain that.
The other small piece of news I have is I’ve been doing a lot of work on my YouTube channel and putting videos into playlists. One of the latest videos I uploaded was just a short 10 minute video specifically for Australian payroll users, and it shows you what the ‘My Payroll’ area for employees looks like. Typically if you’re the Xero adviser, you can’t see that. You actually need to set up a different account, and if you invite an employee in to access Xero, they see this special ‘My Payroll’ area and it’s really good. It’s a massive, time saving, innovative feature that Xero has with their solution.
I encourage you just to pop in and have a look at that. I know that businesses told me it was saving them 15-20 minutes per employee per week because the employee is empowered to access their own information, submit timesheets and submit leave applications via the ‘My Payroll’ area. But enough about that, today I interview Alex Falcon Huerta from Soaring Falcon Accountancy. I was very excited. I actually met Alex at the Auckland Xerocon. Alex is a cloud accountant who uses cloud technology to make clients experiences more fun. She’s based in Bedford in the UK but as with many accountants, I’m sure she’s available to service people globally. I started by asking Alex …
If you could bottle something from your childhood, what would it be?
Alex: Oh my goodness. It would probably be a Russian doll I guess. If I could have gone back that far, I definitely would have kept it. It was a memory I would have kept forever. It’s obviously something that makes me quite happy.
Heather: Very good, that’s lovely. I actually stay at a holiday accommodation that’s all decorated with Russian dolls, so next time you come out to Australia, I’ll have to tell you where it is.
Alex: You can’t help but open them up, that’s the thing. You have to go inside and open them up.
Heather: Absolutely, yes.
Alex, why did you start your own accountancy business?
Alex: I wanted to create something that was different to what accountants were currently doing. They were using old systems and I was very keen to start using the new technology available to me and see how that would work with today’s internet users. I just find that people of today, they’re very techy and they love mobile phones and they love all the cloud stuff, and I was really keen to get a business started now rather than wait five years. People have already been doing it.
What technology are you using in your own business?
Alex: At the moment I’m using Digita Virtual Office, which is Thomson Reuters product, to create the accounts and personal tax and business tax side. They offer the whole back office system in a virtual office which is fantastic. The other side I’m using is MyPaye which is a UK payroll system. I can use it as a payroll solution, so it’s absolutely fantastic. My clients have access to it. I have access to it. I’m using Xero for my bookkeeping and to manage all of my clients so I can check all of their financials.
I’m using Dropbox for client filing so I can have access and they also can have access, so there’s obviously some sort of system where I want my clients to have access to absolutely everything that they need straight away and it’s available on their phone. I’m using Microsoft Office 365 which is obviously the cloud side again. Everything is 100% cloud practise. I’m not using any desktop system whatsoever.
Heather: Fantastic. I know that you said that while you were in New Zealand, where we met at the New Zealand Xerocon, you actually signed up a client while you were out there in New Zealand.
Are you able to run your office completely virtually from anywhere in the world?
Alex: I absolutely can. That was the beauty about creating 100% cloud practice is that I can work from anywhere and I have access. As long as I have internet I can access anything that they need me to access, which is one of the reasons, again, why I wanted to set up a cloud practice: I’ve got that flexibility of being anywhere. I was completely thrilled when I was able to manage it and sign somebody up whilst being away on a business trip.
Heather: Absolutely, different time zone, different side of the world.
Alex: It went quite well though being in New Zealand.
What sort of clients do you work with?
Alex: My main client base are technology based and creatives, although I am keen to wind that to different industries, but what I’ve found is that it’s more the technology companies that are keen to using the cloud products and their not afraid of using it and they see it as a positive. I’m sure that the different industries will start coming in at a later stage but it’s mainly technology firms that I look after.
What do you think … you used the word afraid, so what do you think small businesses are afraid of?
Alex: I think at the moment people aren’t 100% fully aware of what cloud is. The common questions I have are things like security and whether or not people or anybody can hack into the data. It’s one of those things where it’s like, “No, absolutely it’s completely safe. Since the three years that I’ve been using the main cloud products, I’ve not had one incident where somebody’s hacked into the system or any of the systems.” I would say it was 99% safe.
Heather: Yes, absolutely. I always say to people, “If you’re prepared to do online banking then you should be prepared to do cloud accounting because it’s the same sort of security levels in place.” Typically online accounting is past data. It’s not future data and it’s actually not able to access your financial … your money as well.
Alex: Exactly, yes.
How are your clients finding you Alex?
Alex: Majority of my clients have been from referral. The reason for that is obviously because once I’ve shown them what I’m capable of doing in terms of introducing cloud and then showing them their cloud products and how they can access their data, they’re then showing their friends and being excited about it. Nine times out of ten, it has been on a referral word-of-mouth basis.
Heather: excellent. We just spoke with Saul Colt who is Word of Mouth Marketeer. He’s very much … that’s sort of marketing, that referral marketing, is very important.
So you’re a strong advocate for Xero in your business. How do you feel that Xero is benefiting your clients?
Alex: It’s massively benefited them. If, for instance, I was to introduce an old product to them and then offer them Xero, there’s a huge difference in terms of things like bank fees, real time information, being able to look at their financials straight away and then having access to it rather than saying, “Right, hold on one moment. We’re going to back up your information. I’m going to review it and then I’ll be able to get back to you in a few days.” It’s been massively beneficial to them. They’re working with real time data in order for them to make crucial decisions.
One of the things you said to me was that you help clients review their future trends. How do you help clients with that?
Alex: I normally sit with them and have a meeting with them and go through the current data on Xero. I would then export that into a format where it’s visible and we’ll put in budgeted information based on the information they’ve got today, and help them understand what areas of their business they need to look at in terms of projects or customers, and how they then retain that area or how do they make it more efficient. Basically look at their pain points as well. If there’s anything there that they know they can improve, I’ll help them to find ways to implement efficiencies, and then we’ll plug in the trends for them so they can see what direction their business is heading. If we then see an area where it might be a bit risky, then we can then plan for maybe financial areas, for funding, it’s different risk areas really.
So for the small business owner and the Xero user who is listening to this, can you pick one of … when you’re doing this, can you pick one of the favourite areas that you like to look at, that they should be looking at themselves to perhaps increase their profits? With what you just said, what’s one area you would actually tell a small business owner, “Look, I’m not here to help you, you go and have a look at this area yourself?”
Alex: Yes, of course. I’m always keen to look at the profit and loss for all the clients and to have a look at the monthly view in Xero. It does show you month on month, and you can start to see the trends in terms of the income per one month against the costs per one month. You can then compare that against different months and you can start to see whether or not anything looks strange or odd.
You may look at advertising. It could be a huge cost in one month, and then you can see whether or not your income has started to increase after you’ve advertised, for instance. If that advertising cost isn’t really generating that business for you, it’s an area you can say, “Right, let’s reduce that and let’s look at a different stream of advertising to see whether or not we can generate different type of revenue.”
Heather: Excellent, so comparing your advertising to future incomes and refocusing if necessary. Excellent.
What, if any, business intelligence solutions are you using with your clients to assist them in reviewing their accounts?
Alex: Well, I have tried some of the add-ons to Xero like CrunchBoards or Fathom or Spotlight. They tend to be good reporting tools so that they can visualise their trends in things like pie charts or nine graphs. It makes it easier on the eye. People tend not to like looking at the figures. They tend to like looking at a line going straight up, especially if it’s turnover. It’s really clear with those sorts of things so yes, I do use those methods as well. I tend to use a lot of the add-ons to help me provide information to my clients.
Do you have any general one that you use on a regular basis? When you said that you exported, were you exporting into Excel?
Alex: If I just wanted something quite quickly, I would then export it to Excel and it’s quite straight forward for me then to prepare a graph, it takes minutes. If it’s something that’s a little bit more … they wanted more percentage growth increases or things like that, it depends on really how much information they’re after, I’ll then create that myself and use it as a tool for them, or I’ll use one of the reporting tools.
How does an add-on solution from the Xero marketplace get in front of Alex?
Alex: What I tend to do is if a client has a pain point, I would then review the market, the add-on marketplace. I would then find the solution, for instance if they wanted a payment solution, I would then search in the marketplace for that solution. I tend to go with the ones that I’ve used, I know work really well, but I’m also keen to look at some of the new ones and find out exactly what they have to offer. I would watch their one minute video maybe that they have and just check out to make sure that it is going to be a good fit for my client. So yes, there are different things that I look at really.
Heather: It’s quite vast, isn’t it, the marketplace now? I find it’s kind of overwhelming. When someone says they’ve got a problem, you’re like, “Okay, there are a few solutions out there.”
Alex: Exactly, I know when I first started using Xero in the marketplace, there was about 20 different add-ons and it was quite easy to keep on top of. A year later, there were 300 and now there are 400 plus. I can only imagine that’s going to keep increasing, so add-ons will need to find a way to get on top of things so that the accountants will then pick them.
Heather: Yes, absolutely. I think that’s going to be a key thing for their survival, is how do they get in front of people. Alex says the one minute video, they definitely need. Perhaps even addressing how they deal with pain points is what you’re saying, “This is my client’s pain point,” addressing how they actually deal with the pain point. Sometimes you go on the site and you’re like, “I’m reading, I don’t understand what you do still. I don’t understand what industry you’re in,” etc. But that hopefully is really useful for them.
Alex: Yes, I think one of the things that is also good to make a note of is as an accountant, we’ll look at the things that the product can do but also the things that it can’t do. It might not necessarily be a negative, it’s just highlighting the fact that, “Right, okay. That might not be such a good idea for my client at this moment.”
Heather: Yes, absolutely, and have it there as an awareness of moving … possibly could move to that solution, and I think it can’t do … are really good, like some inventory solutions don’t do serial numbers. You just want to know that up front because that can make or break the whole situation. For some industries, it doesn’t matter. For other industries, “Yes, I can’t work with you if you don’t do serial numbers.” Plus use by dates and things like that which are just tiny things that they could share that information, easy to understand format.
What add-on solutions have you worked with and are you recommending to your clients?
Alex: I’ve worked with quite a few. I’ve worked with Stripe, eWAY …
Heather: Okay, tell me … like as you mention them, if you could say Stripe and then what does Stripe do?
Alex: They’re a solution for … similar to PayPal where people can make a payment directly into your account. That’s then allocated against the Xero invoice. So once it comes into the bank feeds, it automatically selects it against the invoice so it obviously becomes more efficient because you can then just have a double check on the information and then click okay.
Heather: I think it’s a solution that’s just recently come into Australia. That’s why I wasn’t familiar with it. I was like, “Let’s stop and talk about Stripe.”
Alex: Yes, Stripe is a big one for me. I’m really keen to use Stripe. It’s one of those ones that it does actually make your life easier, which is one of the biggest things you use add-ons for because you want to make your life easier.
Heather: Absolutely, yes. That’s going to improve cash flow for the small business as well, isn’t it?
Alex: Yes, absolutely. Another one I use is Receipt Bank and Tripcatcher. I’m really keen to use those. They obviously scan the invoices for you and they send them straight into Xero. Once you’ve done all the setting up and configuration, it’s really, really straight forward. They’re fantastic add-ons.
Heather: Yes, there is a bit of setting up with Receipt Bank but once it’s there, it’s good. Explain Tripcatcher because I don’t think that one … I think that one is very much a UK based one. Can you explain that one?
Alex: Yes I can indeed. It’s an app that you have on your phone and every time you make a trip to and from business destinations, it then links into Xero and it creates the mileage for you at the rate that is set in your phone. So different cars and different sized cars in the UK, you can claim a certain amount of VAT back. It calculates that for you so you don’t have to go in and put mileage claims as such. That’s a great one. I think you have a link with that from Receipt Bank as well.
Heather: Oh okay, fantastic. I think I cut you off but you did mention eWAY. Are you using eWAY?
Alex: Yes, I do use eWAY as well. Again, it’s very similar to Stripe where … it’s a different method of payment. I think nowadays, the different methods is crucial because people are all over the world. You can’t just use a UK payment method, it needs to be worldwide and global, especially for the cloud products where in a particular case, if they go viral, they need to be able to manage their payments. So I think something like eWAY and Stripe, again, they’re really good systems to use.
Any other solutions that you’re using with your clients?
Alex: At the top of my head, I can’t really …
Heather: No, that’s fine. People are always really interested to know what other people are using and it’s really beneficial for people to hear you share those, so thank you so much for that.
Alex, you’re a fellow of the Chartered Certified Accountants. What has that meant for your career?
Alex: I’m pleased obviously. I qualified ACCA back in 2007 and I became a full member in 2008. It’s obviously important that I do have that qualification. It helps me to gain the type of client that are keen to use a chartered certified accountant. Obviously they don’t want to go with somebody who doesn’t have that, especially my clients I have that … not just Bedford, the local ones but the London base as well, it just gives you the credit that you need to show that you’ve got the skills and the knowledge and the experience behind you. I’m keen to make sure that people are aware that I am a chartered certified accountant.
Do you think the content of what was studied within the qualification of the ACCA exams was helpful in starting and running your own business?
Alex: Oh wow, it was a long time ago now.
Heather: Fair enough.
Alex: But definitely it has given me the skills to get to where I am today, absolutely. I do find that although some accountants are qualified by experience, you’ve still got that element where you’ve got that crucial background knowledge of going through the different areas. So when you do approach something that’s new, you’re not afraid of it.
I remember doing like the costing and the formulas, and although I’ve not used it, I knew that once I worked hard at achieving it, that I knew I could overcome it. I have that same approach with anything I come across today. So in a way, it has prepared me to set up my own business because I’m not afraid of something that’s new.
Heather: Yes, absolutely. I think if you can get through those ACCA exams, you pretty much can do anything. They’re so hard, the last lot of them.
Alex: It is yes.
What do you think the current outlook is like for small businesses in England?
Alex: I think at the moment it’s obviously an expanding area. I think a lot more businesses are coming onboard. I do basically think it does come to the tools that are available to them. People don’t like bookkeeping or they don’t like keeping their paperwork together. Solutions like Xero who make life a little bit easier and make it fun to use, they can say, “Right, I’ve got that behind me. I can get on with it and focus on what I love doing.” It is an expanding area and I’m also keen to help those new companies that want to set up in business.
Do you see a lot of people moving out from corporate going into freelancing or going into starting a small business?
Alex: Yes, I have come across a few people that have branched out on their own. That tends to happen a lot, again, with the tech companies and the creatives, they want to step away from the corporate companies and set up on their own and start on their own projects. It’s really good to see that happen. Again, I like to see that happen because I get to help them.
Talking about helping them, what do you look forward to doing most in your business Alex?
Alex: I very much love meeting up with my clients and talking to them about their business. Whilst they talk to me, I’m always thinking in the back of my mind, “Okay, what steps can I do next to help them,” or if there’s anybody else I can introduce to them or connect them to someone. That’s a very key element, again, to make sure that I’m ahead of what they’re thinking.
If they do need financing, have a got the right finance company there available? If they needed a tax specialist for any specific area like research and development, I know whether or not I can implement that into their company. So I’m always … that’s my favourite area is knowing I can connect the people and help them.
Heather: Angus Norton from Xero, he has just recently given a talk and he was talking about connectivity. I think essentially he was meaning the connectivity of the technology products but I think accountants and business advisers and bookkeepers are in a key position to actually connect businesses with other businesses when they see that there is a strategic alignment there or a gap there, and help them fill in the jigsaw pieces.
Alex: Yes, exactly, especially if you know that one client can help the other. It’s fantastic to know that they can then connect and then support each other.
What words of advice do you have for someone out there who’s thinking of taking the plunge and starting their own accountancy business?
Alex: I would probably say that if they have got an area that they are keen to work with like myself, I’ve got a technology based firm, that they need to then focus on that area and just concentrate clients that they can help, and just make sure that they’ve got the whole setup and a checklist really of things that they need to get in place. One of the things I needed to make sure I had was a practicing certificate. That needed planning. I couldn’t just go ahead and do that overnight, so there are certain things that you’ll need to make sure you have in place, like insurance and bits and pieces.
Alex: Yes, lots of things to think about.
So what do you forecast the next five years ahead will look like for you and your business?
Alex: I’m looking to obviously expand the business. I’d like to take a tax specialist onboard. I’ve just recruited an apprentice. They’re due to start in September. Again, I’m looking to grow the business and grow the practice. I’m working from home at the moment which is obviously fantastic, but again, looking for an office to accommodate the new staff that would come onboard. I’m keen to keep looking at the add-ons and perhaps have an IT department where they’re just doing like integrations and looking at the add-ons in particular because anything that I can implement to make a job easier and more efficient, I’m keen to do that. There are lots of things there.
Heather: It sounds like you’re getting pulled in lots of directions because the cloud integration side of it is so interesting as well, isn’t it?
Alex: Yes, absolutely. I do.
Now, is there anything else you’d like to share with the listeners Alex?
Alex: I think it’s quite important that people do start taking onboard the cloud products and everything that’s available to us. It does help and it does make life easier. Some of them do need a little bit of time but I would say not to be afraid of it and to take it onboard and speak to somebody like myself who’ve used products for a while, that are keen to help, and get you up and running and started.
Heather: Fantastic. Thank you so much Alex for sharing your knowledge and your wisdom with us. Really appreciate it.
Alex: You’re welcome and thank you very much.
Heather: Cheers. I will cut this and it should be up on Cloud Stories in the next couple of days. I really appreciate your time Alex. Thank you so much.
Alex: You’re welcome. Thank you very much Heather.
Heather: Cheers. Bye.
- Soaring Falcon Accountancy – http://soaring-falcon.co.uk/
- Digita Virtual Office – https://www.digita.com/pro/
- MyPaye – http://www.mypaye.co.uk/
- Xero – https://www.xero.com/
- Dropbox – https://www.dropbox.com/
- Microsoft Office 365 – https://login.microsoftonline.com/
- CrunchBoards – http://crunchboards.com/
- Fathom – http://www.fathomhq.com/
- Spotlight – http://www.spotlightreporting.com/
- Stripe – https://stripe.com/
- eWay – https://www.eway.com.au/
- Receipt Bank – http://www.receipt-bank.com/
- Tripcatcher – https://www.tripcatcherapp.com/