What is top of mind for accountants these days? How do they view automation and the endless entreaties by influencers in the profession to dump compliance and shift to advisory services? To find out, we sat down at Accountex USA in Boston with editors of three of the top publications in the accounting industry: Daniel Hood, Editor-in-Chief of Accounting Today, Seth Fineberg, Managing Editor of AccountingWEB, and Jess Scheer, Executive Editor of Accountex Network. Put on your headphones or stick in your earbuds and join us for an entertaining, informative, and wide-ranging discussion.
- 00:13 – We managed to get three editors from the top competing accounting media properties together in one spot!
- 00:35 – We asked the panel - what is top of mind in the accounting industry?
- 01:13 – For Accounting Today, Dan says tax and tech is at the top of readers' minds
- 02:00 – Dan reveals a bit about AccountingWEB's approach to sharing relevant accounting news
- 03:04 – Jess says tax law changes are what keep accountants employed
- 03:48 – Dan says hyper-focusing too much on one specific topic, like tax, means you're missing out on the bigger and more important accounting-industry picture
- 05:15 – Like it or not, Jess says advisory is in your future,
- 06:39 – Dan says accountants need to realize that they're much more comfortable with change than they believe
- 07:47 – Don't forget that small and mid-sized firm owners are entrepreneurs, combining that perceived conservatism with a huge amount of risk
- 08:43 – Jess says the constant barrage of "Do Advisory" advice started with vendors
- 10:53 – Seth notes that there's a dark tech and automated cloud looming over the billable hour
- 11:38 – The concept of killing the billable hour isn't a new one
- 13:42 – Turn and face the change - The gentleman talk about the transformation from paper to digital in accounting media
- 14:20 – If you want to stay on top, you've got to be willing to meet your clients where they are
- 15:53 – Seth talks about the art of fine-tuning the accounting content to stay connected to readers
- 17:08 – Who's gonna drive you home? The data is - in media, and the accounting industry
- 18:35 – The guys talk "A" words - automation and advisory
- 20:49 – As advisory services start to play a bigger role, the bigger firms are starting to be more selective about their client lists
- 22:32 – Dan's theory - AI and advisory are going to position the smaller accounting firms for bigger success
- 23:41 – Jess says there are three levels, when it comes to the evolution of accounting - Let's do it, Help Me do it, and Leave Me Alone!
- 26:11 – Seth's conclusion - Automation enables greater profitability
Connect with our guests
Get in Touch
Meet Blake and David in person!
Limited edition shirts, stickers, and other necessities.
Jess Scheer: These are entrepreneurs, and there is nothing more risky than starting your own company.
Blake Oliver: Welcome to The Cloud Accounting Podcast. I'm Blake Oliver.
David Leary: And I'm David Leary.
Jess Scheer: I'm Jess Scheer, with Accountex Report.
Seth Fineberg: Seth Fineberg, Editor, AccountingWEB.
Dan Hood: And I'm Dan Hood, Editor-in-Chief of Accounting Today.
David Leary: Wow. We have all the editors of the big major media powerhouses in the accounting industry at one table. We're here at Accountex USA in Boston. You guys normally do not ... You're siloed [00:00:30] out; competing media properties brought together to speak about whatever we're gonna speak about today. Any ideas, Blake?
Blake Oliver: Well, I have a starter question, because I am always wondering what is top of mind for accountants, bookkeepers, anyone in the accounting profession? You all have unique insight, in that you know what articles people are reading. I read everything. I read this particular article, and I think it's fascinating, but maybe that's just me. Maybe I'm weird. So, I'm curious to know, based on your perspective, what is top of mind for the accounting profession?
David Leary: I'd be interested if it [00:01:00] aligns with what we've seen in our downloads. QuickBooks Live is huge for us, download-wise. Everybody loves QuickBooks Live, but outside of that, I don't know if we have any numbers. So, that's a great question, Blake.
Blake Oliver: Who wants to start? Dan.
Dan Hood: Well, I'll give you ... This is literally just in terms of actual numbers of story views - it's anything tax. Still, there's very much a technical focus-
Jess Scheer: Definitely.
Dan Hood: -in all ... It's the tax regulation status, IRS guidance, and all that stuff. They're very into the technical issues. [00:01:30] still. It's only after you sort of clear that away and say, "All right, what else are they looking at?" That you get to the broader professional issues, or the practice-management issues?
Blake Oliver: You mean articles like, actually, how do you deal with, what, like Wayfair, sales tax, income tax, TCJA?
Dan Hood: Yeah, anything about the Tax Cuts and Jobs Act is huge. Things about when the IRS comes out with the new 1040s; or the proposed 1040s; the proposed W-4 - all that sort of very technical stuff, that's top of mind, because that's what they're doing every single day.
Blake Oliver: How [00:02:00] about you, Seth?
Seth Fineberg: Yeah. I mean, mine and Dan's approach - the approach of AccountingWEB, and the approach of Accounting Today, obviously, we're keeping our finger on the pulse of what's actually going on. What we'll do is go, okay ... Blake, you brought up Wayfair. When that happened, we didn't necessarily say, "Okay, this happened." We kind of take the perspective of, "All right, let's find people who know something about sales tax and have been following it, who've been active about it and tell other tax professionals [00:02:30] how to advise their clients how to deal with it." That has been huge.
If you've been kind of following along for just that story thread, just Wayfair, specifically, and its impact on a state-by-state basis, it's pretty fascinating on what is actually going to ultimately happen to retailers, state by state. Yeah, anything that an accountant can get their teeth into, tax-related. That's just one tax topic. But Tax Cuts and Jobs Act - the [00:03:00] ripple effects from there, which are gonna be going on for years.
Jess Scheer: Absolutely. The best-kept secret for accounting firms is that changes in tax laws keep accountants fully employed. The only thing better is a chaotic roll-out of changes in tax laws, and we had both last year [cross talk]
Dan Hood: Pretty much.
Jess Scheer: -it's been fantastic.
Dan Hood: It was a great year.
Jess Scheer: It just hit like a ton of bricks. I've been covering the profession, I guess, 17 years. Dan has been involved even longer than that. What [00:03:30] we've seen the most with accountants is nothing motivates an accountant more than changes in the regulatory environment, and just compliance, in general. You have to do that. Google what's going on in the UK, specifically.
Blake Oliver: So, David, I'm getting the picture - we're covering completely wrong topics. We should just switch to tax.
Dan Hood: This is the thing is, is you'd think, right, because we're spending ... Gotta cover all this sorta stuff, but then the issues that are really gonna matter for them ... They can't just focus on the technical thing. That's [00:04:00] what's really changing the story going on. The profession is ... If you stay only focused on the technical issues, on the tax-law changes, the regulatory changes, you're missing out on some things, on some opportunities.
But also, there are some- I don't wanna call them threats, but there are some issues, and some areas of concern that are coming up that you won't find out about, if that's all you're paying attention to. It's entirely too easy to focus only on the day-to-day sort of thing, as opposed to taking a step back and looking at where the profession is going, and where the business is going.
Jess Scheer: Ultimately, this does get around to the A-word that we [00:04:30] were discussing before, which is advisory. Ultimately, all of these changes and all of these things ... Just putting tax aside, but even just with tax, itself, it's like you have to be on top of this, because your clients have questions. They've more questions, not just about tax, but about just the whole changes- all the changes in the business environment, in general. Who are they looking to the most?
Are you going to be sitting on the sidelines with that and continuing to just, "All right. Well, I'll help you; fill this out for [00:05:00] you, and I'll make sure that you don't get audited," and all these things that we've been doing for years, and years, and years. Or, are you actually gonna have to step up and talk to your client more about planning issues?
Dan Hood: Have you met their clients? They don't wanna talk more to their clients. No one wants to ... You know what these clients are like ...
Jess Scheer: But no, it's true. That's pretty much what's happening. You're getting pushed to advisory, whether you like it or not. I think there's really two pieces. The first one is the compliance piece around tax is table stakes, right? It's [00:05:30] not that that's what's driving needs. It's that they have to do that part. Why do they have to do that part? Well, one, there's a steady base of work, but the second part is that then gives you the insight to do the higher, more profitable advisory work. One feeds the other.
What drives traffic to our websites, to our content is that table-stake content. The question is, if that's all you're focused on, then I think we'd be doing a disservice, if we said, "If you just are good at tax, then you're gonna be a great firm going forward." I [00:06:00] think that's a baseline; then, the next opportunity is where can you follow the money? Where can you find more profitable revenue sources? That's where advisory comes in.
Dan Hood: I think a lot of people are worried. They say, "Oh, they want us to give up our old core services and just do this advisory stuff." That's not right. You have to stick with the old work; you have to stick with the old stuff, because that's what gives you the reason to exist-
Jess Scheer: Yeah, that's ... You have to ... That's what brings them in. Then, it's like, "Oh, well, we can have a conversation about what do we do next? What do you do over the next three years?"
Dan Hood: One of the things I ... I keep coming back to this whenever I think about the [00:06:30] tax ... We talk about a huge amount of change going on in tax, and accountants keeping up with it, and paying a lot attention to it. Like I said, it's driving a lot- it drives a lot of our traffic.
Jess Scheer: We like those numbers.
Dan Hood: Keeps the doors open. Keeps lights on. The thing that fascinates me about it is that you hear a lot from ... You may hear this more from observers of the profession than from people in the profession, but there's a general sense that accountants don't like change; they're a little conservative; they're not up for change; they don't want to make these changes. You think that the fact that, every year, they're able to digest this vast [00:07:00] collection of changes, and apply them with expert precision, and so on ...
Forget just the craziness of the Tax Cuts and Jobs Act. Every year there's some ridiculous new set of standards. There’s three huge new FASB standards - CECL, and lease accounting, and all that sorta stuff. Accountants have a tremendous ability to digest change. They just don't think of it that way. When you think about the fact that they're able to say, "Oh, yeah, the tax code changed in 1,500 different ways, and I figured it all out, and applied it for my clients in seven different industries, and [00:07:30] individually," that's a huge amount of change to manage and digest. Accountants should think of themselves as much more comfortable with change, I think, than they do.
David Leary: I love that point.
Jess Scheer: That's one of the things I think is really fascinating about the space. By their nature, they may be conservative, particularly when it comes to audit and tax. It's, "We wanna make sure that we stay within the boundaries of the law."
Dan Hood: Right.
Jess Scheer: The difference, though, is, particularly for small to mid-sized accounting firms, like the ones we have here at Accountex, these are entrepreneurs. There is nothing more risky than starting your own company, regardless of industry, and starting your own accounting firm in as [00:08:00] challenging a market as we sometimes have, with all the changes you're talking about, and leaving the guaranteed income of a larger firm to start your own firm is incredibly risky. There's that interesting psychological juxtaposition between our audience.
Blake Oliver: It's not that accountants are averse to change, it's that there's ... They're too busy absorbing all the changes in the actual tax law to ... That makes sense, right? Because that's what you're good at. That's what people are paying you for. Practice management comes a little bit later, and [00:08:30] maybe that's part of the reason the shift to cloud has taken longer, here in the U.S., right? In other countries, they do not have this complex regulatory regime like we do. Income tax is not as difficult in Australia, or New Zealand.
Jess Scheer: I would add that I think what they're averse most to, at least in just being observers of the profession, as we are, is being beat over the head with, "This is what you have to do. This is what you have to do!" And where it's coming from ... A lot of it, a lot of this, "You have to change! [00:09:00] You have to change!" It kinda started coming from vendors in the space-
Blake Oliver: Not just kind of ... We've been in that space.
Jess Scheer: I'm being kind ... I'm being kind, Blake ...
Blake Oliver: It makes sense. You're trying to get people to implement your software, your tool, your solution. Well, how do you motivate them to do that, other than with fear that they're gonna be left behind if they don't?
Dan Hood: Fear is great.
Blake Oliver: Fear is a great motivator. So-
Dan Hood: I'm afraid all the time.
Jess Scheer: It drives web traffic [cross talk]
Dan Hood: I was gonna say, the other half of that, to be fair to vendors, the other group of people ... Well, there's a number of groups of people [00:09:30] saying, "You've gotta make this change." Vendors are big on it, but everyone ... All three of us are big on -the media, and thought leaders, and pundits, and stuff like that - are constantly saying, "Hey! We heard this from a vendor - you should change and move to advisory." I don't think anyone's doing it dishonestly, but there's definitely-
Jess Scheer: No.
Dan Hood: There are ulterior motives to a lot of it.
Jess Scheer: But I think the other piece is it's not creating demand where it doesn't exist. I think one of the things that drives the attendees, here, is the role that technology plays, and [00:10:00] technology is changing even faster than regulatory change. Technology enablement has two big components to it. One, to your point around firm management, it's gonna help you grow faster, right? You can't always hire fast enough to keep up with demand. And it's also the challenge of adding people, when you're not sure if this new service, this new office is gonna make it. You can figure out how to work more efficiently, internally, with automation.
The other part is, as large firms have been firing their clients, and those clients have now been [00:10:30] making their way down to the small and mid-sized firms that we have here at the show, technology has helped to level the playing field. Those clients are used to accountants with a certain level of technology automation. So, they're required to - if they wanna pursue those clients - be able to serve them in the same automated, cloud-based, secure manner.
Seth Fineberg: Well, the one thing that, since we're on the topic of automation, and the topic of change, the one thing that is [00:11:00] most threatened by automation is the billable hour. Accountants are finding it harder, and harder to justify things that are getting more and more automated; to charge for that time to do it.
Blake Oliver: If you are successful with your automation endeavors, and you're on a billable-hour system, you will put your firm out of business.
Dan Hood: Right. How do I bill for pushing a button?
Jess Scheer: Yeah, putting it simply, absolutely. That's [00:11:30] what I think they struggle with the most. They kinda don't wanna leave that behind, because this is what's safe; it's what they know; they can see it. I remember, years ago, when first hearing Ron Baker talk about it at a conference, maybe 16-17 years ago ... It was at an AICPA conference. He was getting up, talking about getting rid of the billable hour, and people ... You would think that this was a child murderer up there. I swear! People ... Two, [00:12:00] three, four people getting up, shaking their fists, and yelling at Ron Baker [cross talk] about how it's immoral, and it's ...
Dan Hood: To be fair, Ron viciously hates ... He would kill the billable hour, if he could. He would literally ... If you named your child, Billable Hour, he would kill it-
Jess Scheer: He would run ... He would run it over twice-
Dan Hood: Twice, and then beat it with a shovel. He [cross talk]
Jess Scheer: This was 16-17 years ago, and he was talking about this. It really kinda struck at the heart of the profession. You would think that, yeah, he was just taking food out of their mouths.
This episode of The Cloud Accounting Podcast is sponsored by Right Networks. In a perfect world, everyone would have 100 percent of their clients on a cloud-based accounting system using cloud-based apps, but the world isn't perfect, and clients have a wide range of needs. For some, this means using desktop-based software. That's where Right Networks comes in. Right Networks is your 100-percent accounting-focused desktop in the cloud that also includes an ecosystem of over 250 connected apps.
As you and your clients take the journey to the cloud, Right Networks will be at your side innovating the best ways to leverage the true cloud future by investing heavily in cloud apps, like Transaction Pro and Autofy. They've created an always-on environment that supports 24/7 data transfer. Right Networks also offers no scheduled downtime for maintenance or application updates and meets the industry's highest security standards.
To join the more than 50,000 firms that use Right Networks daily with their clients, head over to CloudAccountingPodcast.promo/rncloud. That is Cloud Accounting Podcast dot promo forward slash R-N-C-L-O-U-D. Be sure to visit the Right Networks booth in San Jose at QuickBooks Connect 2019.
David Leary: Change [00:13:30] is hard, right? It's gonna take time. If I'm correct, Accounting Today had a paper magazine-
Dan Hood: Still does.
David Leary: Did AccountingWEB have a paper magazine?
Seth Fineberg: Never.
David Leary: Never, and then-
Seth Fineberg: We are celebrating our 20th anniversary this year.
David Leary: Just strictly web from the get-go [cross talk]
Seth Fineberg: 1999, yeah-
Dan Hood: Interestingly, the first 15 years of AccountingWEB, they were just in an office. They would call people in to read the stories to them. They didn't have any [cross talk] facts, and stuff, early on- [00:14:00]
Seth Fineberg: Those were the days ... Those were the days.
Dan Hood: -they just got on the internet five years ago-
David Leary: You guys had to go through a change, because media ... I mean, you think the accounting industry is going through a change? Look at the shift media has had the last 25 years. Can you speak to some of the learnings of that, as far as how .... You had to transition, right, Dan? Like, how that affected you guys?
Dan Hood: Probably the big overall lesson is you have to go where the people are, right? You have to go where your readership ... For us, where your readership wants to be for accountants. You need to go where your clients want to be. They want a certain [00:14:30] kind of service. They want a certain kind of certain kind of interaction. Whatever that may be, and it'll vary from client to client, you need to meet them there. That's the thing we realized - it was more and more of our audience, more and more ...
Actually, our audience - we still have a paper magazine, because we still have a section of our audience that just wants paper magazine, and it's a great way for us to reach them. We reach the majority of our audience now, though, online, and actually a much bigger audience than we ever had, because we have much bigger reach online. But that was the thing - we needed to be where they are. You're not gonna reach any accountant under 40 with a print magazine, and actually, some even older [00:15:00] than that are already ready to get [cross talk]
Jess Scheer: Unless you're chasing them down the street with it-
Dan Hood: Literally.
Jess Scheer: I don't know [cross talk]
Dan Hood: But that's a different service entirely [cross talk]
Jess Scheer: Value-added service.
Dan Hood: You can't automate that. Having a person chase you down the street is pretty much a personalized service. But that's the message, I would say, for accountants is you really need to be where your clients need to be. Actually, I would expand it, and say you need to be where staff you want ... Right? We're always talking about staff crunch, and how difficult is finding people. You need to be where they are, whether [00:15:30] that means at a certain technology level; you need to ... You can't look like an old-fashioned firm, when they come into your office; or whether it means, recruiting; if you're recruiting through local papers, that's probably not the [cross talk]
Jess Scheer: No, have the audit standing desk, and things like that.
Dan Hood: Yeah, you've gotta look like where they wanna be.
David Leary: I don't wanna let you off easy, Seth, since you're standing here, like, "Hey, we've been on the web since day one ..." I'm sure it's changed. The game is different.
Seth Fineberg: Oh, it is. What I was gonna add is, yeah, you've had - to Dan's point - you do have to respond to your audience. I would go [00:16:00] a step further in that I spend ... We spend a lot of our day figuring out things like looking at Google Analytics and looking at where traffic is coming from. We have to go to them. That's why search engine optimization has become so important, because we have to know the things that they're searching for. We have to have searchable topics. We have to really focus on the things that ... It's like, okay, this is driving traffic, but why, and where is it coming from? We have to fine-tune [00:16:30] those dials bit more than ever.
Dan Hood: That's a tremendous parallel with accounting, right? For years, in print, you had no idea what people were reading, and what people responding to, how advertising was doing.
Seth Fineberg: It was a lotta guesswork.
Dan Hood: It was all guesswork, and sorta like, "We think ..." and everyone had to believe you. Now [cross talk]
Seth Fineberg: "What's our circulation?" [cross talk]
David Leary: It's like podcasts.
Seth Fineberg: No idea who's out there.
Dan Hood: There are at least five people listening to this podcast right now.
Seth Fineberg: My mom. Your mom ...
Dan Hood: Wait, no! That's 10. Sorry, I was ... I [00:17:00] guess none of us are probably gonna listen to this anyway, so it is all our moms-
Seth Fineberg: Is that even on?
Blake Oliver: No, it's not even recording. This is just ...
Dan Hood: No, it’s just the amount of data that's available and the need to go through it, the need to actively dig through it, as opposed to just going with guesswork and saying, "We think this is what's going on." Now, you can know, and more and more clients are gonna want that from accountants. The data is there, it's just the accountants need to be willing to dive into it and grab it.
Seth Fineberg: I bring [00:17:30] up Google Analytics again .. It's like, okay, I'm looking at this chart. I'm looking at these trends and things like that, by topic, by just generally. We make decisions a lot based on that, because we have it in front of us. Same thing with bookkeepers. They have these numbers in front of them. Now, it's like, okay, how do we respond to that? What do we do with that?
Getting back into the topic idea, outside of tax and things like that, things [00:18:00] like cash flow management, cash flow forecasting - that is becoming pretty big for us. And we wouldn't have known that necessarily ... Obviously, anecdotally, you talk to people at shows and things like that; that's why we do like to get out among the other humans every so often and just not stare at our desks; but looking at some of the numbers, too, of things that people are searching and coming to our site. We're like, "Oh, wow! Okay, we should have more on this."
Blake Oliver: Cash flow management, that is the basic advisory [00:18:30] service that you could be offering as an accountant, or a bookkeeper to your clients, because every business-
Jess Scheer: Definitely bookkeepers, for sure, yeah.
Blake Oliver: -every business has to think about cash flow, right? Some crazy number of businesses, a percentage, go out of business every year because of cash flow problems; like 80 percent, right? We've talked about advisory - we've touched on that - and automation. I wanna get your take on how those two things tied together, because they are really related in that we're all talking about compliance being automated. Obviously, not all compliance is going to be automated, but there's [00:19:00] a lower level. Basic returns. We have the tax-prep companies - TurboTax-
Jess Scheer: The audit work.
Blake Oliver: Lower-level audit work is being automated with AI, with companies like Mindbridge. I think Thomson Reuters has a product that does that, too. There's less need for staff. TurboTax Live, right? A lotta people are gonna go to that, instead of walking into a tax store these days. That's putting pressure on the bottom of [00:19:30] compliance. Then, the advisory is what you need to move up into from there.
Dan Hood: Well, to have anything left ... My favorite thing is Credit Karma ... They did, not this year, but last year, did a million tax returns for free, because they're like, "Well, we have all your financial information from your credit report. We'll do your tax return ..." They did a million. Now, there's, what? Over 145 million tax returns filed every year, but they did a million of them. It doesn't take long for you to realize that a lot of that business can just disappear, and if you're not [00:20:00] doing advisory, then-
Jess Scheer: What are you doing?
Dan Hood: Yeah.
Jess Scheer: The other part- it's not just chasing revenue, but it's chasing profitable revenue. The audit and tax work is fine. It's table stakes, as we talked about before, but the more profitable billable hour, or project, or value-based billing - so I don't get Ron chasing me - is-
Dan Hood: You will. Feel that red dot on your forehead. That's his ...
Jess Scheer: The reason you're pursuing it-
Dan Hood: He's in the rafters, looking to shoot-
Jess Scheer: He's somewhere. He's [00:20:30] everywhere ... The more profitable work is that advisory work, so it's not just a matter of finding alternatives. One of the things we're seeing at the larger firms - and I'm gonna play host and ask Dan and Seth to chime in on this one - I look to the larger firms to see what's happening- what's going to happen downstream.
One of the things that we've seen over the last two years, since the tax rollout, is a larger firm shedding clients; firing clients that were just doing audit and tax; very basic low-margin [00:21:00] kind of work; which then created opportunities for those downstream. When we get all the way down to the small to mid-sized firms - here's we're defining firms with less than 50 FTEs. One, they're those larger clients they're pursuing, but they're also seeing that tax advisory and financial advisory, and all the cash flow work, et cetera, is higher-margin opportunities, as well.
David Leary: I'll jump in and just reinforce that. I talked to somebody with a top 200 firm, at BeachFleischman in Tucson, about two weeks ago, I had lunch ... He was saying, as they're moving to advisory and doing this higher-value work, they're actually finally saying [00:21:30] no to clients. They used to just take on ... Every single person that came to the door, you're a client of BeachFleischman. Now, they've actually started to say no, because they- in their new model, their business model, if they don't select the right clients, their business model doesn't work in the future.
Dan Hood: I want to see ... Actually, I think that is the way to go in the future, but I am fascinated, because there's gotta be some firm, somewhere, that will take all the dogs that get kicked out of everybody else, that are like, "I don't wanna work with you."
David Leary: QuickBooks Live.
Dan Hood: Ouch! That's a lot! Take them to the burn ward. But anyways [cross talk]
Jess Scheer: Disclaimer - we love [00:22:00] all of our vendors here at Accountex-
Dan Hood: -they've gotta end up somewhere, right?
David Leary: It's the QuickBooks Live model. There's a bunch of firms doing this model-
Jess Scheer: There's a couple guys in dark suits that are coming this way-
Dan Hood: That makes sense. That's where they're gonna end up, because what's gonna happen, I think, for the accounting firms, what they're gonna be ... What we're gonna discover is every small business is gonna get a CFO, or a kind of CFO, right? If the accountants are moving up to advisory the way they should be, they're gonna be doing the bookkeeping; they're gonna be looking at the books, looking at the taxes, but also then, providing them the advice [00:22:30] that a CFO should be giving them.
In theory, this is gonna make it ... Well, everything's much more complicated for everybody. So, it may be the difference between more small businesses surviving or not, but it may also be the difference between a lot more successful small businesses than not. That's one of the models behind anything where you're bringing an accountant together with a small businesses is that they can use that advice. If accountants are automating and moving away from the actual grunt work of the bookkeeping, and the tax work, and freeing themselves up to do more of the analysis, and the insight, and the advisory [00:23:00] stuff, in theory, everybody's business should be in much greater shape.
Jess Scheer: Dogs and cats living together ... No, seriously. I mean, this is really what is ... If you really wanna start really going there, you're actually helping out the economy more than some of the regulatory environment would otherwise do, or not do. But you have to start somewhere. It's not just, "Hey, poof, I'm the CFO!" or, "Hey, poof, I'm an advisor!" It's [00:23:30] a gradual thing. You have to sort of just be willing to embrace some of this work and, and actually just really think about ...
Look, we look at the profession in three sort of tranches, if you wanna put it in a pyramid. Way at the top, about, say, seven or eight percent are ... This is kind of the Uber community. These are [00:24:00] people like CHADD from LiveCA, and Ryan, and people who are just really way at the top. Dawn Brolin; people who are kind of- embraced automation from the get-go and are doing all kinds of amazing things and are just really like- these are the accountants of the future, today.
Then you have, in the middle, I'd say around- somewhere around 50-55 percent; good chunk of the market are just kind of your workaday- [00:24:30] your CPAs; your enrolled agents; your bookkeepers, who are at firms ... Less- a dozen or so staff; easily sub-20 staff. They are not unwilling to change and do all these things, they just need help, and they need that hand-holding.
Then you have what I call the LMAs - the Leave Me Alones. They're kind of in the bottom. They're just like, "Yeah, I'm fine. I'm [00:25:00] already booking 150k a year; I've got my client base." It's not that they're not willing to tweak things in their own practice, but they're ... Maybe you don't pay as much attention to them, but they're still kind of a minority.
The majority is still ... They finally have gotten to the point of where they're willing to listen, and it's taken years. But here we are, 2019, and you finally have the majority of the profession that are saying, "Yeah, talk to me," but do [00:25:30] it in the right way.
Seth Fineberg: I think this serves two buckets of companies, if you look at- in those three tranches, right? There's the companies that are looking- firms that are looking to grow, and firms that are fine with the lifestyle choice. They're-
Jess Scheer: Growth can be subjective, too.
Seth Fineberg: Absolutely. There's nothing wrong with someone saying, "I've got my clients. I know QuickBooks. I don't need to learn anything else, and I'll use my older version until I can't- it's not supported anymore; then I'll just upgrade to the next version. I don't need anything [00:26:00] else. This is good enough. I'm making enough money."
David Leary: Those guys are not listening to the podcast [cross talk]
Dan Hood: In that case ... They were at a party last week, and you should hear what they did!
Seth Fineberg: I think that's part of the LMAs, right? The folks that are growing or that are seeking growth, either because they want more profit per partner, they're looking at it as a good strategy, et cetera, automation is a great enabler to drive toward greater profitability.
Blake Oliver: Well, this has been a great conversation. Thank you all [00:26:30] so much for joining us.
Jess Scheer: Thanks for having us at the table.
Blake Oliver: Yeah.
David Leary: Your media properties don't come off this fun [cross talk] You guys are much more fun in person [cross talk]
Dan Hood: That's because our bosses don't usually let us do this.
Jess Scheer: We try to be. I thought we were the bosses ...
Dan Hood: I think that illusion was shattered long ago.
Blake Oliver: So our listeners know where to reach you, and if they haven't discovered your publication yet, let's let them know. We'll go down the line. Dan? Dan Hood, where [00:27:00] can people connect with you online and your media?
Dan Hood: We're at AccountingToday.com. I'm @AccountingEdit on Twitter, or Daniel.Hood@SourceMediacommunity
Blake Oliver: And how about you, Seth?
Seth Fineberg: We are https:// [cross talk] AccountingWEB.com, and I am Seth.Fineberg@AccountingWEB.com. I'm also on Twitter: @B2BSeth.
Blake Oliver: And Jess?
Jess Scheer: JessScheer@Accountex.com. Really [00:27:30] easy to find.
Blake Oliver: As always, I am @BlakeTOliver on Twitter. And you, David?
David Leary: I'm @DavidLeary, and I think that's a wrap.
Blake Oliver: Thanks, guys.
Dan Hood: Cheers, all. Thanks.