Intuit acquires ChronoBooks & news from Xerocon London

David and Blake are back from weeks on the road and ready to dig into the news, including: Intuit has acquired ChronoBooks to bundle with QBO Advanced; Xero released their half year 2020 results, partnered with TransferWise for electronic bill payments directly INSIDE Xero (UK only for now), and teamed up with GoCardless for inbound ACH payments in the Americas; Google is rolling out checking accounts for consumers; why the future of banking means you're probably still broke; Blake's favorite new app (You Need a Budget); half of firms are still not using eSignatures, and more.



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Blake Oliver:
This is exactly targeted toward moving QuickBooks Desktop Enterprise users to QuickBooks Online Advanced. That's the parallel. They're trying to fill the feature gaps with these acquisitions.
Blake Oliver: Welcome to the Cloud Accounting Podcast. I'm Blake Oliver.
David Leary: And I'm David Leary.
Blake Oliver: And we're back from weeks and weeks of travel, it feels like ...
David Leary: I'm back in the closet. I feel like I haven't recorded in the closet in four weeks, five weeks, it feels like. 
Blake Oliver: We've been seeing each other in person. It's been so strange.
David Leary: A three week run, right?
Blake Oliver: Yeah. We're at QuickBooks [00:00:30] Connect last week in San Jose and before that, where were we? [crosstalk] AcuityCon in Atlanta. Then, before that Intacct Advantage. Then before that ... 
David Leary: In Vegas, yeah ... I think that was it. Just three weeks, but it feels like five weeks. It just felt like a lot. We have good shows coming out. We have Intacct Advantage episodes coming out and then, we'll follow those  up with the QuickBooks Connect coverage.
Blake Oliver: So, yeah, it was a lotta fun. It's good, though, to be back, and I'm looking forward to talking just [00:01:00] the news, right? Just the news, as you do ...
David Leary: Regular news. Welcome to all our new listeners. I know lots of people at these conferences have discovered us for the first time. We helped you subscribe on your phone, and hopefully, you get notified that this episode just came out, and you are happily listening to us.
Blake Oliver: Yeah. Thanks for everyone who stopped by at our booth, or I should say, our table at QuickBooks Connect, and said hi, and grabbed a sticker.
David Leary: Oh, and shirts! Everybody is wearing the shirts.
Blake Oliver: Oh, yeah, the shirts ... 
David Leary: People are taking photos in the shirts. People are buying the limited-edition [00:01:30] cassette-tape shirts that are on our merch store, which is exciting. I'm actually surprised people are buying them. They came out so cool. My daughter, we went to the movies, and she wanted to go into Hot Topic ... Is it Hot Tropic? Hot Topic, at the mall? 
Blake Oliver: Hot Topic ...
David Leary: Hot Topic. I'm way too old ... You can be like, "Okay, Boomer ..." Is that the trend right now, you could say that to me? 
Blake Oliver: Oh, yeah, I'm just gonna say that to you now, every time.
David Leary: But I was in there ... Because they have all those T-shirts on the wall; they have hundreds of them. I was just in there wearing my cassette-tape shirt, my Cloud Accounting Podcast cassette-tape shirt ... I was like, "This is just as good as any [00:02:00] shirt they're selling in that store!" 
Blake Oliver: Maybe Hot Topic will pick it up as sort of this tongue-in-cheek thing that the teens start wearing, right? 
David Leary: Oh, that would be our dream! We could retire! 
Blake Oliver: And we sell a million of them.
David Leary: We sell 1 million Cloud Accounting Podcast cassette-tape shirts. That'd be the best! 
Blake Oliver: But David, I have to clarify something. You're not a boomer, right?
David Leary: No, I'm. Gen-X.
Blake Oliver: You're a Gen-X-er, right? Okay, good, because I couldn't do this podcast with a boomer, I don't think. I mean ... 
David Leary: Oh ... You need to apologize now, Blake, to all our boomer listeners. 
Blake Oliver: It'd be like doing it with my [00:02:30] dad or something like that, you know? By the way, have you seen that Saturday Night Live skit of the son and dad doing the podcast together?
David Leary: How did we not talk about this?
Blake Oliver: It's like an advertisement as a way to bring yourself together ... It's this father-son podcasting kit, and it comes with the microphones [crosstalk] so you can talk to your son ... 
David Leary: We'll have to put that in the show notes, the link to this. So, those of you who have not seen this, it is absolutely genius. If you really like podcasts, and you listen to a lot of podcasts, I'm sure you've heard ads for Squarespace. They put a Squarespace ad in the middle of this thing. [00:03:00] It's hilarious. It's just a whole level of genius, for sure.
Blake Oliver: It's great. So, David, what else is new? I think you got a puppy, right? 
David Leary: I got a puppy. So, that's big ... 
Blake Oliver: Why would you do that to yourself?
David Leary: I got a puppy during all this crazy travel, but it's good now ... She's sleeping most of the night now. It's getting easier already. She's 10-weeks old. She's a lot of fun. I'm also on my PTA adventure, still.
Blake Oliver: Oh, right. You're doing the books for the PTA, right?
David Leary: I audited the books. I finally got the audit done. Then, I just do the monthly reconciliation. I'm not the treasurer. But, of [00:03:30] course, you start getting involved in your PTA, and you'll find this out soon, when your son starts going to school, there's not enough people on the PTA, so you get sucked into every project.
We had a walkathon ... Of course, I'm like, "Why are we doing this with paper? We should move it to the cloud!" So, I did tons of Google searches; I finally found software to do a school walkathon with. It's an app called RallyUp. I started going round, and round, and round; I started chatting with them. Turns out they're even in Tucson, which is crazy that I had to go 30 searches down in Google to find an [00:04:00] app on the same street as the kids' school.
Anyways, this app is great because now it's all in the cloud. People can go on. They were able to do pledges and then, I upload the kids' running activities in at the end. But the struggle I'm having- that we're having is, unlike cloud accountants, you could just tell your clients, "If you don't wanna go to the cloud, I'm not gonna be your accountant or bookkeeper," right? 
Blake Oliver: Right. 
David Leary: You can't do that to parents of kids at your school. So, we're trying to balance this. People are still doing paper-based [00:04:30] pledges and trying to balance that out with a subset of online pledges, and we've gotta reconcile everything. It's a very big pain, but the nice thing is it's setting up nicely for the future for next year. They just clone this and rerun it.
Blake Oliver: Taking the PTA to the cloud, David. 
David Leary: I know! I'm getting real genuine life experiences here.
Blake Oliver: Fighting the good fight.
David Leary: Exactly. What about you? 
Blake Oliver: Yeah, well, I am one month in at Jirav doing the marketing there and having a blast doing it. It was just fun being [00:05:00] at QuickBooks Connect, and doing both the podcast and doing Jirav stuff. We had that awesome party with Gusto. Really, really cool to be working with Gusto on marketing stuff because I've always admired them, and I was a customer from when, I think, they were 12 people in San Francisco. Now, it's what? Hundreds, if not close to 1,000 people working there.
My first Jirav webinar is scheduled for Friday, November 22nd on CPA Academy. We'll have the link in the show notes. It's all [00:05:30] about leveling up your financial outputs ... "How to Save Time, Add Value, and Delight Clients," the idea being that we have spent the last five to 10 years in the cloud-accounting space figuring out how to streamline our inputs, get the data in; OCR, like what you've been doing with AutoEntry, David. Scanning; bank rules; digital payments. All that stuff is about getting the data into the system. Well, what happens when you close the books, and you need to go [00:06:00] report to that client?
Not a lot of firms have figured out how to standardize the reporting that they do and streamline that. That's what Jirav does. Jirav is all about forward-looking ... Not just creating dashboards, or reports for your clients, but also planning for them out into the future. So, that's what excited me about joining, and we're doing our first webinar on Friday, November 22nd. So, please join us if you want to learn more about how you can up your value as a bookkeeper, accountant, controller, [00:06:30] or CFO.
David Leary: You get CPE for that, I think I saw? 
Blake Oliver: Yeah, it's a CPE webinar. It's on You can go there and just search for my name or search for Jirav, and you'll find it, or you can click the link that we'll have in the show notes. 
David Leary: Cool. I think that's probably it for our updates. We should try to jump in the news. Before that, we did get to review.
Blake Oliver: Yay! 
David Leary: Do you wanna read it?
Blake Oliver: This is from JeffMadduxCPA. The best. Five stars. "By far, the best and easiest way to stay updated [00:07:00] with the latest happenings in cloud accounting and technology. David and Blake's insightful commentary is informative and entertaining. So much learning going on here. Too bad it doesn't qualify for CPE." Well, if you want some CPE, join me on my webinar on November 22nd. Let's get to the news, right? 
David Leary: I don't know what to even start with it. There's been a lot.
Blake Oliver: Since we were just at QuickBooks Connect, and we just dropped that episode that we recorded live there, which, by the way, if you haven't heard it, you gotta hear the Live at QuickBooks Connect episode with [00:07:30] David DiNardo and Valerie Heckman, all about what's new for accountants. So, to follow on to that, we should talk about the Intuit news, right? Intuit has acquired ChronoBooks.
David Leary: Yes. ChronoBooks is an online backup software for QuickBooks Online. 
Blake Oliver: Which is funny because ...
David Leary: I hear the gears turning.
Blake Oliver: Yeah. You're not supposed to need a backup for QuickBooks Online. I think the value for ChronoBooks, or the reason people use ChronoBooks isn't necessarily ... Disaster preparation is one [00:08:00] reason. You don't always want to necessarily trust the vendor with all your data, or you wanna have a backup just in case something terrible happens. But also, version control, which is something you had in Desktop, but you didn't have it online.
David Leary: That's where I think it really comes in because the fundamental, "Oh, my hard drive crashed. I need to have a backup," I think that goes away in the Online world; but you could hire a temp employee who does a bunch of bad data entry for two days, and you wanna go back to the way it was two days ago; or you have an app [00:08:30] that you didn't set up correctly, and it stuck a bunch of bad data in your QuickBooks Online file. That's the reason you wanna have some sort of backup tool to let you turn back time.
Blake Oliver: So, Intuit has acquired ChronoBooks, and they're going to be bundling it with QuickBooks Online Advanced, which will enable QuickBooks Online Advanced users to revert/restore past changes of QBO, which has been a highly requested feature among Advanced users, [00:09:00] according to this blog post by QuickBooks.
David Leary: What's interesting about this ... I was kind of digesting this a little bit. Them bundling this with Advanced does make sense a little bit because people that are still using QuickBooks Desktop Enterprise, more than likely, they probably have multiple hands in the QuickBooks file. They have an A/P clerk, an A/R clerk; they have people in the warehouse touching QuickBooks. The risk of people messing up the data and them having to restore a backup is probably a lot higher than a smaller company that just has [00:09:30] one bookkeeper in the data file. So, I could see where this actually might help and make it a safer decision for a QuickBooks Enterprise customer to move to QuickBooks Online Advanced, because now they're gonna have that little bit of peace of mind solved.
Blake Oliver: I think you nailed it, David. This is exactly targeted toward moving QuickBooks Desktop Enterprise users to QuickBooks Online Advanced. That's the parallel. They're trying to fill the feature gaps with these acquisitions.
David Leary: So, congratulations to Nate, and the team at ChronoBooks, [00:10:00] which I think might just be Nate ... I think it's been a pretty small one-man show- 
Blake Oliver: One person- 
David Leary: I think, yeah ... And it's fast. He built- started the app, I think, two-and-a-half years ago.
Blake Oliver: Well, and I'll make a prediction here, which is that Intuit acquires an inventory management system, a really robust one, at some point this year, or in 2020 because that's one of the big gaps, too, with QuickBooks Enterprise.
David Leary: Well, let's save our predictions for our Predictions episode on January 1st [crosstalk]  I have some predictions, too, yeah- [00:10:30]
Blake Oliver: Okay, so you didn't hear that, listeners. I'm gonna save that one. Okay, got it. 
David Leary: You can save that one for our Predictions.
Blake Oliver: All right, cool. Any other Intuit news or should we talk Xero?
David Leary: Yeah, I think we could talk about Xero, because Xero had their Xerocon London, which I was really surprised the amount of announcements that came out of Xerocon London, because wasn't Xerocon in Australia just three weeks ago in Brisbane? And there was no announcements. There was barely any announcements. It felt like there were some meaty, meaty announcements this week, this time.
Blake Oliver: Some of the announcements were [00:11:00] UK-specific. One of the big ones was UK-specific. We didn't get to go to London, obviously; not this year. Maybe [crosstalk] sometime in the future. 
David Leary: Yeah, we would've died. To tack on that on the other side of QuickBooks Connect? We would've eventually died. There's just too much- too much travel.
Blake Oliver: But we did see the blog post. So, this is what came out of Xerocon London.
David Leary: All right, fill me in.
Blake Oliver: First is Xero's half-year 2020 results; Xero being New Zealand, Australia, and company reports twice a year. They reported that they surpassed 2 million subscribers [00:11:30] globally, ending the first half with 2.057 million subscribers. Here's what is interesting about that. It took Xero a decade - over a decade - to add their first million subscribers. Well, it just took two-and-a-half years to add the next million. So, that is exponential accelerating growth.
David Leary: Yeah, and I think that's true with QuickBooks Online, as well, right? They're both seeing this amazing 35-, 40-percent growth. But it is funny, even like the old QuickBooks Online charts; the first decade was [00:12:00] like 60,000. 
Blake Oliver: Yep. 
David Leary: It's amazing.
Blake Oliver: We're starting to get to ... Well, like you've said in the past, with Xero and QBO added together, we're getting to Desktop numbers, past Desktop QuickBooks numbers. That represents growth of 30 percent in annualized monthly recurring revenue and total subscribers. Xero is doing about 30-percent growth; a little more than that in terms of their revenue. They had a net profit after tax of $1.3 [00:12:30] million, which is the first positive first-half net profit result they've had yet. So, profitable, and growing 30 percent, annually, and over 2 million subscribers - really good. They also announced an initiative called Net Zero at Xero. They are committing to offset 100 percent of carbon emissions starting March 31 and going forward.
David Leary: So, does that mean all their sales reps that have those little BMW [00:13:00] MINIs, they're gonna now get Teslas?
Blake Oliver: Maybe, or they're gonna buy carbon ... I think they'll be buying [crosstalk] Xero is saying, "We're gonna go carbon neutral," which is a nice thing to see for a software company. That is what's new in terms of the big money announcements, initiatives like that.
David Leary: What about product?
Blake Oliver: Yeah, what about the product? Because we saw some really interesting product released at QuickBooks Connect. What is going [00:13:30] on with the product at Xero? Well, the big thing in the UK ... Now, unfortunately, this is only a UK feature at this time, but I have my fingers crossed right now that it comes to the US soon. Xero has teamed up with TransferWise, the payments company, to offer a domestic bill-pay solution for UK customers directly inside of Xero that allows customers to pay bills using their existing bank account inside of Xero. [00:14:00] This is what we were talking about the other day, David, is our dream.
David Leary: When I misinterpreted Xero's other announcement-
Blake Oliver: Yes.
David Leary: -that was like, this is what it should be doing. Apparently, they coded it up three weeks later and announced it.
Blake Oliver: Yeah, exactly. They heard you, David, and they said, "Oh, we have to do this for Xerocon London." What is this replacing? Well, in the UK, people are used to downloading what are called batch files from Xero. You select all the bills that you want to pay, you download, I believe, it's a CSV file, like a spreadsheet, [00:14:30] of payments you wanna make, and the account numbers, and you upload that to your bank. Then, that sends out the payments to your vendors via their equivalent of ACH - their electronic payment system - which is also a lot faster than ours, by the way.
Now, that's annoying because you've to download a file, upload a file. It's not particularly secure. Also, some banks in the UK don't accept those batch-payment files, so it was always a pain. Now, with the TransferWise integration, you get a secure API connection, digital audit trail. You [00:15:00] select what bills you want to pay in Xero, and you click a Pay button. All of the payments go out via TransferWise's digital payments system automatically. All of that gets reconciled in Xero, in one click, through a single statement line, and you can see the status of the payments in "almost real time," in Xero. You can also send remittances to your suppliers. This is so cool. It's really, really neat [crosstalk]  
David Leary: It's so obvious. Everybody should be doing [00:15:30] this. If I'm in my accounting system, and I have bills to pay-
Blake Oliver: Why can't I just pay them?
David Leary: It's great that they sync to an app, but then, I have to go up, or I open up Veem, or open up whatever other payment service I'm using, and my bills are there ... It's great. It's not work, really. I open up a browser. I put a check mark. I say, "Pay now," and it just pays those online through this other service. But if I could just cut all that clicking and just hit the Pay button now ... It'd be great to have more than one button - Pay by TransferWise; Pay by Veem; pay by; whatever services I wanna pay that vendor with - because [00:16:00] some of the times it might eventually be vendor the vendor; one vendor wants their payments from; another vendor wants their payments from some other service. 
Blake Oliver: Some of our listeners may be asking, "What is TransferWise?" Because it's bigger in the UK than it is anywhere else. TransferWise is a British online money transfer service that was founded in January 2011 by two Estonians. They have 4 million customers who collectively transfer around $4 billion per month. What's interesting about TransferWise is that they route most payments in a different [00:16:30] way than the traditional banking system.
They do not transfer the sender's money directly to the recipient, in the case of Swift, and they do international transfers, by the way. They actually match the amounts with other TransferWise users that are sending money the other way around. So, they net out transfers and then, use the pools of funds to pay out transfers via a local bank transfer. They actually started out as a way to get around wire transfers internationally and save money that way.
David Leary: Yeah, which is smart because I think if you do a wire transfer, every 15 [00:17:00] people that touch that money on the 15 stops, all want a fee, and they basically are getting rid of all those fees along the way.
Blake Oliver: Now, imagine you're a UK customer; you can now pay vendors, I believe, through TransferWise - who's all over the world - directly from inside of Xero. I hope that we see that here in the US really soon. That would be just awesome. But there was a feature update for The Americas that was announced. The update from Xero is a GoCardless integration. This [00:17:30] is not on the accounts-payable side. This is on the receivables side.
GoCardless is in ACH debit-payments provider, and now United States and Canadian users can integrate Xero with GoCardless to accept recurring ACH and pre-authorized debit payments through GoCardless for Xero. Instead of having to take a credit card from my customer, which is the current- the current thing is I can set up like a Stripe auto-charge with a credit card. I can [00:18:00] now do automatic ACH, as well, which is something I was waiting for because it's much cheaper to do ACH.
David Leary: I didn't know GoCardless was in the US now, as well.
Blake Oliver: This is important. Because according to research from NACHA, which is the group that oversees ACH in the US, by 2020, ACH is going to become the most widely used B2B payment method in the US. 80 percent of businesses in the US now prefer to receive their B2B payments via ACH debit. While 53 percent of customers, or consumers, [00:18:30] I should say, share the same payment preference for recurring bills.
David Leary: The reason for that is why?
Blake Oliver: Because you don't have to get a paper check, and you have to pay credit card fees [crosstalk] 
David Leary: It's fees. It's the fees, yeah. 
Blake Oliver: You're not paying ... With Stripe, we've been able to automate stuff with Stripe for a while, but it's 2.9 percent of the transaction, which, in B2B payments, can be a lot of money because these are big payments. Instead, you're paying 50 cents, a dollar, or maybe a few bucks at most, usually, with an ACH. [00:19:00] So, pretty cool. That is, I believe, all of the Xero news this week that I spotted.

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David Leary: I've gotta piggyback off of that with some Square news. In a way, I think I have a group of articles here that are all a little bit related to these tech companies becoming banks that we constantly talk about.
Blake Oliver: Mm-hmm. 
David Leary: Three weeks ago, four weeks ago, we discovered that Square has an API for Square Books.
Blake Oliver: Yeah. [00:21:00]
David Leary: We've been talking about how, hey, Square is possibly Intuit's biggest threat in North America.
Blake Oliver: Someday. Not right now, but someday.
David Leary: Someday, yes. So, Sam Byrnes - he's from Down Under ... There's a blog called Livewire, and he wrote a blog post about how, "Xero Needs to Square Up." He observed, just as well, maybe listened to the podcast ... Sam, you could've put a link or a plug in there for us ... He noticed that Square also has this general ledger now. He wrote a kind of a point-of-view article. [00:21:30] Basically, his premise is - is Xero focused on the wrong 800-pound gorilla - Intuit being the 800-pound gorilla - when there's this other one out there called Square? 
He kind of questions a little possibility that Xero may not have the correct long-term business model because Square has no entry-level product to the market. Square reaches entry-level small businesses. QuickBooks does; QuickBooks has QuickBooks Self Employed, right? They're reaching people at that basic-basic-basic level of the market and Square isn't in [00:22:00] there. Then he- Go ahead- 
Blake Oliver: Right, but ... Well, I was gonna say, QuickBooks Self Employed targets those freelancers, whatnot. I guess Square is targeting primarily retail, it seems to me, or am I wrong on that? [crosstalk] service providers, as well, right?  
David Leary: Any small business that wants to get paid, just use Square's product for charging, at this point. I have another Square article that'll go into more of what Square's doing a little bit. He really argues that Xero is now fighting two gorillas; not just Intuit anymore. Then- [00:22:30]
Blake Oliver: Then, like you said, if the market grows enough, then-
David Leary: Everybody wins.
Blake Oliver: -even if somebody just grabs Intuit's old Desktop share of the market [crosstalk] 
David Leary: - he brought up a couple of other interesting points. I thought it was a good observation. He actually mentioned that Intuit might be in prime fighting condition to take on Square as a competitor because Intuit's been battle-hardened from fighting Xero. Because the last eight years, Intuit's been really going at it with Xero so [00:23:00] hard that they're ready to fight somebody like Square.
Blake Oliver: Maybe they would ... Do you remember Intuit ... Maybe they still have it. They had a swiper, too, that they came out with after Square started? 
David Leary: GoPayment. I think it's still available. Yeah.
Blake Oliver: Yeah, I had a GoPayment swiper, in addition to my Square one, and I tested them both out. I feel like the GoPayment one, I never see that anywhere. I never see anyone using that; but I'm always seeing the Square reader.
David Leary: I've never seen a GoPayment in the wild. It's very rare. Yes. Square is ... I've said this before, if you ask small [00:23:30] businesses in North America what they've heard of, they've heard of QuickBooks, Square and maybe Constant Contact. Nobody else exists. Avalara, you don't exist. doesn't exist. Nobody exists. It's just ... That just shows how big Square is.
The one other thing he brought up in his article, which is interesting, is Square is currently, currently playing nice with both Intuit and Xero - everybody's using each other's APIs; people are moving data back and forth. But just like Intuit and Xero don't integrate, what happens if Square decides, "Hey, guess what, Intuit and Xero, we're not gonna integrate anymore," and [00:24:00] now customers are going to have to make decisions here?
Blake Oliver: Right. 
David Leary: If Square offers GL, you don't need an integration to a Xero GL, or an Intuit GL. It's a good article that's kind of interesting. This ties into another article that I saw about Square, which is where they'll be in 10 years. This article was on The Motley Fool ... Really, the genesis of this article was comments made by Jamie Dimon of Chase; he's the CEO of Chase. They had an Investors [00:24:30] Day earlier this year, and he was just talking about ... In general, the gist is about all- he was talking about all the things Square has done over the last 10 years that Chase could have done, and they just didn't do it.
Blake Oliver: Yeah, that was funny. Here he is, the CEO of Chase, and he's been there for a while, right? He's sort of admitting, "We dropped the ball on this." 
David Leary: Yeah. They were talking about how Square has their Square Capital and Square Cash accounts that are now at like $15 million. It's up 2X from 2017 to 2018. Do you know that Square ... I [00:25:00] know we talked about it before. Did you know you can buy and sell stocks, commission-free, with Square now?
Blake Oliver: I had no idea.
David Leary: You can do that … Square's also in the crypto game. I'm kind of looking at this more, and more, it's this race between tech and the tech companies, right? 
Blake Oliver: Right. 
David Leary: Will Square become a bank before the banks become a tech company? It reminds me the whole Netflix versus HBO streaming thing. Netflix really bet that they would build custom shows faster than HBO could become [00:25:30] a streaming company. That race has kind of been going on. I have some more thoughts on the streaming wars with TV we'll get into because I think it ties back to our industry. We'll talk about it later.
Blake Oliver: No, it's very relevant because my wife says that all of the moms in her mommy group are obsessed with Disney  Plus, now.
David Leary: I have an article on Disney+ we have to ... I don't wanna jump over that just yet because really I wanna- 
Blake Oliver: Maybe if we have time at the end.
David Leary: Yeah. So, this transitions to some other articles because ... I found some old tweets; like, in 2011, I'd been talking about how [00:26:00] Google, Apple, Amazon are the new banks. Then, I was tweeting about it in 2014. Well, guess who now wants to become a bank? Google, this week, announced that they are becoming a bank.
Blake Oliver: Really? Wow.
David Leary: I actually found this a little entertaining. Do you remember the MyPayrollHR episodes we did? 
Blake Oliver: Of course. How could I forget?
David Leary: And the ACH money-movement company?
Blake Oliver: Cachet.
David Leary: Cachet.
Blake Oliver: Right. 
David Leary: The bank name that Google is using is code-named Cache. 
Blake Oliver: Oh, [00:26:30] interesting. 
David Leary: Which I find funny because maybe a lot of people are searching for Cachet - "Where's my money? Where's my paycheck? Where's my bank?" It turned out to be a big search term, and that's why-  
Blake Oliver: It's not a bank code-named Cachet. It's the project [crosstalk] 
David Leary: Yeah, the project is code-named Cache, but I just thought that was a little bit entertaining-
Blake Oliver: Or maybe it's just Cache, right? 
David Leary: Yeah, Cache. Keep it Cache [crosstalk]
Blake Oliver: It has to be Cache because it's banking, right? Cache - banking. 
David Leary: Yeah, C-A-C-H-E. 
Blake Oliver: There we go ... What is it exactly?
David Leary: So, Google is going to partner with Citigroup, and then, [00:27:00] also, there was a credit union. I lost the name of the credit union here.
Blake Oliver: Stanford Federal Credit Union.
David Leary: Yeah, Stanford Federal Credit Union. What they're trying to do is they're not really trying to be a bank because, obviously, Google's under all this tech scrutiny, right now, right? Monopoly types of use. They're trying to partner with traditional FDIC-, or NCAU-insured accounts and just kind of doing a data play so that they don't get the scrutiny. They're kind of trying to keep some separation level there.
Blake Oliver: Yeah, this is what a lot of the apps are doing is they're partnering with a traditional bank. They're building [00:27:30] an app on top of that bank. To the end user, it seems like it's Google's account, or Google is the one providing them all these features and stuff, but it's the bank underlying it is doing all the regulatory stuff.
David Leary: Yeah. It's interesting because they talk about how Google's really trying to jump on the mobile-wallet game.
Blake Oliver: So, this is a smart checking account, basically. We've seen this a lot from ... There's plenty of these. What was the one that broke recently? We reported on that, right? 
David Leary: Chime.
Blake Oliver: Chime, yeah. Chime went down because [00:28:00] one of the apps in their stack fell apart, and they couldn't make payments or whatnot. So, it seems like Google wants in on this, too.
David Leary: Yeah. They're trying to get on this. Everybody wants to go on this because everybody ... It's data. "Oh, I know what people are spending their money on," and they can advertise more.
Blake Oliver: Well, this is a dream, as a Google advertiser ... If you can advertise specifically to people who bought these types of products, then that's great. That's even better than their web-search data. It's their purchasing history. 
David Leary: The Washington Post had some different stats, and some of the articles didn't have [00:28:30] ... They're talking about payments; e-wallets. Obviously, Apple's winning payments. People are paying with their Apple Watch, paying with their Apple phone. You see it happening at stores everywhere. But Google's only in third place in that. Do you know who number two is?
Blake Oliver: No. Who?
David Leary: Starbucks.
Blake Oliver: Oh, yeah. Everybody has a Starbucks wallet. I'm kind of amazed that you can't use it to pay for other stuff. That would be genius.
David Leary: Yeah. They start using it at other stores. So many people have a Starbucks wallet. It's amazing that that's bigger than Google. [00:29:00]
Blake Oliver: It's so easy because I just pull out ... I open the wallet in my phone, and I find the Starbucks card, and I just scan it, and that debits my balance. It's so much easier than Tap. It works always.
David Leary: There's no guessing. I'll sit there at Starbucks, and I see people of all ages use it.
Blake Oliver: Yeah, and I can carry a physical card, because it's just a code I scan. It's just a number, basically ... Although, that makes me question the security of it, but that's another matter.
David Leary: But it's not tied to [00:29:30] your bank accounts. It's very simple.
Blake Oliver: Yeah. 
David Leary: All you're doing is ... Basically, it's an electronic gift card, but [crosstalk]
Blake Oliver: Yeah, it is a gift card. That's what they started as- 
David Leary: -they've done such a good job. Anyway, the point is, for all the people that have a Google phone in their pocket, Starbucks app and paying at Starbucks is still bigger than Google payments, across the board. I'm going somewhere with this ... Revolut, we talked about them before. They're seeking $500 million to staff their global expansion. They're another neo-bank. They, right now, have 1,800 employees. [00:30:00] They wanna staff up to 5,000.
There's another company called Payro - P-A-Y-R-O. they are just gonna offer payroll financing to small business owners. Hey, if you don't have enough money in your payroll checking account, and you gotta pay your employees, you can use this app to get a quick instant loan to pay your employees. There's another mobile banking app called Tide. They just added a QuickBooks integration. They're launching. All these new banks are launching. Well, this leads into an article I found in Wired Magazine. The title of the [00:30:30] article is, "The Future of Banking is ... You're Broke." It's a bit of a scathing article about the whole neo-bank future.
Blake Oliver: What is so bad about all these apps that make banking easy?
David Leary: Because, ultimately, they're putting a slick veneer, in tech, over banking services. Ultimately, they're just moving maybe the payroll cycle up three days. So, you're still broke; you're just getting paid three days earlier is kind of the argument-
Blake Oliver: Oh, you mean the ones that will [00:31:00] do payday loans, essentially ...
David Leary: Well, that or there's other ones that are doing budgeting. They're calling this all a revolution in consumer banking. Ultimately, nobody can really ease the real pains that are out there, like people not having enough paycheck- 
Blake Oliver: Which is people living paycheck to paycheck?
David Leary: Paycheck to paycheck. Exactly. You just can't do it. Eventually, all of these neo-banks are gonna ... Their business models are exactly the same as all the current banks. You make some money on the interest; you do loans ... They're selling [00:31:30] the exact same services just with a fancy veneer, which means they're gonna eventually have to charge the same rates as banks. They're not gonna be able to let people overdraw their account by $100. That's VC money going out the door when they let people do that.
Ultimately, this is interesting because my observation on this - my experience from years ago, even going to events, like Money 2020 or the fintech-type conferences - a lot of people are always trying to attack personal finances. You could argue every single person should be tracking their [00:32:00] budget and working on their personal finances, but the reality is there might be 16 million people that do it as a hobby and that's it. 
This is why Quicken, which was Intuit's original product that led to QuickBooks and everything else, never grew for 30 years. You had basically 16 million personal-finance hobbyists using it, and nobody else uses ... Nobody grows and tracks their personal finances. Ultimately, there may not even be a market for all these products long term. 
Blake Oliver: Well, especially if Chase and [00:32:30] the bigger banks catch up and offer slicker apps, and no-fee accounts, and all of these services that the neo-banks are offering.
David Leary: Yeah. 
Blake Oliver: I have one argument in favor of the neo-banks, and it's really the Google offering that's coming - the cash project they're working on - because, like you said, Google is going after data. They don't care about bank fees. They want to know what is your purchasing history so that they can target ads [00:33:00] on behalf of their business customers' app users. So ,if that data is valuable enough, then Google can subsidize the whole banking operation - what it costs to do that - and not charge fees. That could be [crosstalk] 
David Leary: It just raises the price of a Google ad because now they can track that Google ad all the way to somebody's bank account. 
Blake Oliver: Yeah. I, as an advertiser, would be willing to pay a lot more to target people who are absolutely, we know 100 percent, are buying stuff that I wanna sell them, as opposed to just searching for it.
David Leary: Yeah, but [00:33:30] that's solving for the advertisers.
Blake Oliver: Right. 
David Leary: That's not gonna make you ... You're still gonna be broke. That's not solving- That's the problem, I think, all these neo-banks are doing; they're promising this revolution of how we're gonna save everybody from these pains, but they really can't. That's the point of this article. So, it's worth reading. It's worth looking into; it's worth thinking about and chatting about online- 
Blake Oliver: It is interesting, and there is a broader discussion as to why Americans live paycheck to paycheck. One argument is that the gains of automation of [00:34:00] the economy have gone to the top one percent, et cetera, and that that we need to redistribute income better; that's why people are living paycheck to paycheck. But part of me says it's just because that's the nature of people; that people, if they make more money, they'll just continue to live paycheck to paycheck and consume as much as they possibly can. What these apps are doing is allowing them to consume a little bit sooner, so- 
David Leary: Yeah, and on the other side, letting the advertisers figure out ways to sell people more stuff maybe they don't need. This is like a [00:34:30] Fight Club discussion-
Blake Oliver: Yeah, but our entire economy relies on the consumer economy.
David Leary: Yes.
Blake Oliver: We have to keep it going-
David Leary: Cradle to grave; cradle-to-grave advertising. 
Blake Oliver: Well, hey, you said something about how these apps are not actually helping people budget, and that people are not actually interested in budgeting. Quicken didn't grow, really, and that's why Intuit moved away from Quicken, and moved to QuickBooks, and whatnot. Well, I discovered an app that is changing my life, and it's all about personal budgeting. So, I wanted to share that with you, David. It's [00:35:00] called, or YNAB. It's an app you can download on your phone. It is a desktop website, web app you can use. You can have it for your iPad. To me, it's what Quicken could have been. It aggregates all of your accounts and lets you create a budget for them every month. It's just- it's amazing.  [00:35:30]
I discovered it because I was listening to the Profit First podcast and there was a guest they had on from Latin America, who is Profit First professional who uses that method; but down in Latin America, it's hard to get more than one bank account due to regulations. So, he uses YNAB - You Need a Budget - to create those bank accounts in the app because the app is ... It's a zero-based budgeting app where you put money into digital envelopes. It's like that old [00:36:00] envelope method of budgeting. I don't know if you ever used that, David?
David Leary: Mm-hmm. Yeah, yeah. 
Blake Oliver: The idea is every time money comes into your account, you allocate it into different budget accounts, which are like envelopes. Then, when you spend it, it comes out of those accounts, and it rolls forward every month. So, it's a very intuitive way of budgeting. I'm just super-impressed with it. For our listeners, if anyone is listening and looking for personal-budgeting tools for their clients or themselves, absolutely take a look at it. They're not a sponsor of the show. I just really like the app.
David Leary: It's funny that [00:36:30] you bring them up. I was always familiar with them ... I was one of those Quicken hobbyists; especially in the olden days. We data-entried everything in. There was no bank feeds or anything. You just typed every check you wrote into Quicken. I always knew about you need a budget, but I think, back in the day, it was more like a movement. It was just some spreadsheet templates, but people used to swear by them, and now it's a real genuine app.
Blake Oliver: Yeah, it started as an education thing, as a book and a method. Now, they've built an app around that method,  and it's pretty awesome. Part [00:37:00] of the reason I started using it is because I do my personal finances in Xero. I know lots of people do them in QuickBooks, but I don't know anybody who successfully does personal budgeting in those tools because they're not designed for daily budgeting, like adjusting your budget on a daily basis, based on your transactions. They're meant for longer-term budgeting. It's not easy to go in and update your budget, and try to figure out what's going on, and get your family involved in it. This is designed for that- for that day-to-day stuff.
David Leary: Cool. That might help people not be broke.
Blake Oliver: Yeah, exactly, and- 
David Leary: See, this [00:37:30] is the problem, right? There's an app that might actually help people not be broke, and they get no VC money. Nobody's talking about this app. It doesn't even exist.
Blake Oliver: Yeah, it's funny. I didn't even know about it until I happened to listen to that podcast episode. It's probably one of the coolest apps that I've run across in, honestly, years, and years, and years. Check it out -
David Leary: So, you being a millennial, I have a question for you.
Blake Oliver: Mm-hmm. 
David Leary: So, do you have an accountant or bookkeeper [00:38:00] at all, or do you just use your own?
Blake Oliver: Well, I mean, I do my own books.
David Leary: OK. So-
Blake Oliver: I'm not gonna pay somebody ... 
David Leary: Okay, let's say you were paying somebody-
Blake Oliver: Yeah.
David Leary: -as a millennial ... Did you know one of three millennials are dissatisfied with their accountant or bookkeeper? This is an article in Accountancy Daily. If you're a millennial business owner, it was three points lower than if you were not a millennial business owner. It stems to millennials just are more needy, and they really want a relationship with [00:38:30] their accountant or bookkeeper that really knows their business and is accessible. They're looking to ... The way I hear that is they want an advisor, right? They don't want a bookkeeper or an accountant. They want somebody who will advise their business.
Blake Oliver: Or, hey, just somebody that responds to their messages. That is definitely helpful.
David Leary: Yeah.
Blake Oliver: I think one of the big complaints about working with a CPA or an accountant is they disappear during tax time. You can't get a hold of them ... That's the place to start is just being responsive and offering your clients [00:39:00] easy ways to exchange documents and stuff. Actually, I've got a number for you about that, David.
David Leary: Okay. 
Blake Oliver: Let's talk eSignatures. When you sign your tax return, David, do you want to have to do it by going to the office and signing with pen on paper? You're not a millennial, but ... 
David Leary: No, because I used an app, and I think they're- the accounting firm is based in Minnesota or something. So, I don't wanna have to travel to Minnesota to sign taxes.
Blake Oliver: Well, this is data [00:39:30] from CPA Trendlines on how many firms use digital eSignatures for tax returns/authorizations. So, this is what the tax preparer is supposed to get from you, the client, in order to file the tax return on your behalf, right, David? 
David Leary: This is an CPA Trendlines?
Blake Oliver: Yeah. 
David Leary: So, it's a survey?
Blake Oliver: It's a survey, yeah.
David Leary: Of their readers- 
Blake Oliver: Of CPA firms. It's a pretty broad survey that they [crosstalk] 
David Leary: Okay, so I'm guessing ... Can I guess? 
Blake Oliver: Sure. 
David Leary: I'm guessing under 12 ... Eight to 12 percent use eSignatures. 
Blake Oliver: Oh no, [00:40:00] it's way better than that. It's not that bad.
David Leary: Oh, okay ... 
Blake Oliver: It's less than 50 percent. It's 48 percent of CPA firms are using eSignature tools to have their clients sign tax returns/authorizations; but 52 percent do not. That's still terrible. I'm picturing like-
David Leary: Half.
Blake Oliver: Yeah, so I'm picturing that the CPA .., I'm the client. The CPA sends me the form, and I have to print it, and sign it, and then scan it back to them; or [00:40:30] they send me the entire tax return in the mail, and I have to sign it, and send it back, or I have to come to the office and sign it. There's so many- so many good tools now to collect those eSignatures in a painless way. It's amazing to me that more firms aren't using them. The top tools utilized by firms that are doing eSignatures are RightSignature at 18 percent, CCH e-Signature at 12 percent, and cPaperless SafeSign at seven percent.
David Leary: Wow. If I would've known you were gonna bring this article ... I deleted an [00:41:00] article I had for this week. I saw something about- it's either 12 or 15 percent of all small businesses still use a typewriter, for some reason, in their business.
Blake Oliver: What?
David Leary: Yeah. 
Blake Oliver: Oh, wow ... 
David Leary: But I threw the article away. I was like, I guess this really isn't news. There's too much other news going on. But, yeah, we will continue to be shocked by these. Maybe we'll do that. Maybe that'll be our Christmas episode. We'll just bring out crazy, crazy stats that we see like this.
Blake Oliver: Maybe, maybe ...
David Leary: That could be fun. I have other stuff. I don't [00:41:30] know [crosstalk] 
Blake Oliver: Other stuff? 
David Leary: I have so much- I have ... There's so much news ... 
Blake Oliver: Sell me on it. 
David Leary: Okay, sell you on it ... There's a really good LinkedIn blog post from Angela Meharg. Angela Meharg is a QuickBooks ProAdvisor. She wrote a really in-depth article. It's a good read. It's, "The Truth about QuickBooks Files." It's about, really, the structure of a QuickBooks Desktop data file. What happens is it grows with different file sizes, and writing data, removing data when it crashes, and it gets damaged ...  [00:42:00]
If you really wanna kinda geek out on something, Blake, you should read that this weekend. It's really cool to see that. Obviously, cloud accountants don't have to worry about this; so if you just wanna get in touch with the way it used to be in the olden days ... But it's a good article she wrote. It's a really well-written article.
But her conclusion, which is interesting, is on a long enough timeline, your data will crash and is going to be damaged. It's just a fundamental nature of the way these data files are structured and with the size in them. [00:42:30] Then,  I want to just add on, based on my QA background, you could add 12 transactions to a QuickBooks file, and if you do it the right way and have the inventories go negative, you could damage a file on your own just by purposely doing some crazy stuff in the file.
Blake Oliver: This, to me ... Back in the day, when I was a ProAdvisor, this to me was the thing that blew my mind the most, and still does, is the fact that so many ProAdvisors specialize in desktop QuickBooks, spend most of their time just repairing, maintaining [00:43:00] database files because the people who built QuickBooks Desktop didn't anticipate people having 20 years of history in a file. It's just, fundamentally, the database just can't handle getting too big. This article is about size limits on files. If you get above 1.25 gigabytes on an Enterprise file, you're gonna start having corruption and performance issues. [00:43:30]
David Leary: This is even after Intuit moved from C-Index to a true SQL database. About 10-12 years ... Well, more than 12 years ago. It was about 13, 14, 15 years ago, they did move to a SQL database; then, they're pushing the limits of SQL databases.
Blake Oliver: Right, because desktop computers, they're not designed to open up databases this large, and it [crosstalk] 
David Leary: Yeah, there was Windows limitations at one time-
Blake Oliver: Right. Yeah. So, I can't believe that articles are still being written about this stuff. What's [00:44:00] the takeaway? Is the takeaway to move to online or [crosstalk] 
David Leary: -well, she had two takeaways. One takeaway is Intuit doesn't communicate enough to people that you have a risk, using Desktop data files that get too big. So, people should know this way before they get that big. Then, the other one's like, on a long-enough timeline, it's gonna get damaged. 
Blake Oliver: Look at the cost. She says, "It's the choice between pay now or really pay later. In our view, if you opt to use QuickBooks, you're choosing to pay later. What you'll pay [00:44:30] for is a new file creation or file reduction every few years to the tune of $2,000 to $20,000, depending on how much historical data you truly need to keep in your production file. That's crazy.
David Leary: Some of this- this goes back to personal finances. I've gotten in discussions about this with people ... This is like conference beer talk, right? People have an irrational emotional attachment to their old financial numbers. I don't need my ... I had Quicken files that had 15 years of data in it. Do I really care about how much I spent on [00:45:00] coffee, nine years ago?
Blake Oliver: Well, if you want to run a trend analysis, you know ... 
David Leary: But do I need every transaction?
Blake Oliver: No. 
David Leary: Or can I just have a summary each year? But people will keep every transaction in QuickBooks for 15 years, instead of purging it. You only need a general journal entry every month, maybe, just to have the balance [crosstalk] 
Blake Oliver: Yeah, but people want the sales history- 
David Leary: it's an irrational emotional connection to old data. We're hoarders. We're all hoarders! 
Blake Oliver: I'd push back a little bit on that and say that there's a good reason to have your entire history of sales [00:45:30] data for a customer that's been a long-term customer. You wanna know what they bought, when they bought it, especially if you're supporting those products. The fact that Desktop doesn't have a good way of living long is a problem.
David Leary: All right ... So, listeners, when was the last time you had to go pull up, at a transaction-detail level, a transaction that was more than three years old? I'd love somebody to-
Somebody please prove David wrong. 
David Leary: Send us an email. Tweet this out. Yeah ... Tell me when you've done this, without it being a fraud investigation. Maybe, [00:46:00] I could see on those. But if that's the case, those people are done. You should have purged all your data.
Blake Oliver: Well, and here's the thing - if you're getting this big now, where the size of the QuickBooks file is becoming a problem, and you're a candidate for Online, or if you're Enterprise, then, really, you should be on ... My personal view is that the right fit for most QuickBooks Enterprise customers is not QuickBooks Enterprise Desktop. It is an ERP ... NetSuite has come down in price. You've got Intacct there. Those are systems that will scale, and they [00:46:30] don't have database issues.
David Leary: It's interesting, because when we were at Sage Intacct, I talked to one of their marketing people there, and I was just curious ... When somebody decides to move to a big enterprise-level product like that, like a Sage Intacct, how long does it take? She said, well, it's not long. It takes like three months. It's a pretty quick sales cycle because, she said, by the time people start will start looking at an ERP product, they have QuickBooks ... The wheels are falling off because they've ran QuickBooks for an extra three years into the ground. They've avoided thinking about [00:47:00] moving to Enterprise because it's just ... It's a nightmare thought, right? It's such a big effort to move-
Blake Oliver: ERP, yeah.
David Leary: That usually, when they start going to an ERP-level product, they are in the situations that Angela describes in her blog post here. 
Blake Oliver: It was funny, at lunch, at QuickBooks- or at Intacct Advantage, I should say, they had tables set up; special tables, with signs that said Recent QuickBooks Graduates, which shows you how much of their business comes from QuickBooks Enterprise users graduating to an ERP system.
David Leary: I think Intacct, and QuickBooks, [00:47:30] at one time, had a sales agreement, helping customers migrate over there, at one time. I'm going back eight, 10 years ago, but [crosstalk] 
Blake Oliver: If you ask me, strategy-wise, QuickBooks should be investing in below QuickBooks Enterprise, and let Intacct. let NetSuite go for those Enterprise customers, because it's really hard to serve both mid-market businesses that need that advanced inventory and need all that stuff integrated, and those who don't - the [00:48:00] smaller businesses who don't. If you look at QuickBooks Online Advanced, that is an attempt to pull in the Enterprise people, but I just don't think that, in the end, it can work long term, because there's just too much that's still missing from Online Advanced. You don't have the advanced inventory. When is that ever gonna come?
David Leary: Yeah, I think there's a level of pre-ERP that's in there ... Did I say ERP? 
Blake Oliver: Yeah, you said ERP.
David Leary: What am I saying? Correctly? Okay, I'm sorry ... I tied on the word [00:48:30] 'pre.' Yeah, it's the same letters; backwards, right? Pre-ERP ... That's a horrible. Don't ever ... Nobody should ever say, "Pre-ERP ..." 
Blake Oliver: Pre-ERP. I like it.
David Leary: It'll mess with your brain. So, where you need advanced inventory; you need multiple users; you need huge data things; but you don't need international locations; you don't need three-dimensional reporting. You don't need some of those other needs ... So, there's probably somewhere in there for a QuickBooks Online Advanced-type product that's not going way up market.
Blake Oliver: I have [00:49:00] one more bit of app news that we could just toss in here.
David Leary: Let's do that because I still wanna talk about Disney.
Blake Oliver: Okay. 1Password ... Have you ever used 1Password, David? It's primarily a Mac and iOS thing, so I don't think you've used it- 
David Leary: No, but I've used LastPass ... The one I actually like the best is the one that's built into Firefox.
Blake Oliver: Oh, yeah ... Well, because you're like the one Firefox user in the world. Well, 1Password has been around for 14 years, and it's the password manager of choice for many Apple users. They are a big [00:49:30] competitor of LastPass. They, today, announced, or yesterday, I should say, announced a $200 million Series-A round of funding from Accel; the largest single investment in the firm's 35-year history. That's a lot of money for a Series-A round of funding, right?
Basically, I would say look for 1Password to come aggressively into enterprise and go after LastPass because LastPass has been working in the enterprise for a while, building features that larger businesses [00:50:00] need to manage passwords; whereas 1Password has been focused primarily on consumers. But obviously, the money is really in the B2B space.
David Leary: Which ties back to ... Actually, I have an article that we'll tie this into, because it's gonna lead right into Disney. So, Matt Paff wrote an article about, "8 trends in the Accountant's Software Industry." It's a LinkedIn blog post. One of the things he talks about, one of the headaches that causes app fatigue is he calls out 'too many user names; too many passwords,' right?
Blake Oliver: Oh, yeah. 
David Leary: It just makes [00:50:30] it a total nightmare to use all these apps. So, it makes sense ... If everybody has that pain, you know-
Blake Oliver: I would never be using a dozen different apps if I had to remember all the passwords; write them down in a notebook on my desk. It's essential to have a password manager that links into your web browser, like LastPass, or 1Password, or like you use, David, the built-in password management in Firefox. It just logs you in automatically, securely, and you only [00:51:00] have to remember one password in order to unlock your vault.
David Leary: It's a problem every single person has-
Blake Oliver: But it's amazing to me- 
David Leary: Everybody has so many crazy passwords. 
Blake Oliver: It's amazing to me how many people don't use one, and they just use variants of passwords. They have some sort of strategy for ... They use the same password, and then, they add on something to the end for each individual one; but that's easy to hack.
David Leary: I've always been a fan of It's worth checking out. I don't wanna get into it, but it's a way for you to print your passwords and have them with you in your wallet on a physical piece of paper. But, if [00:51:30] somebody found that piece of paper, they would never be able to figure out your password. It's kind of cool. Worth checking out for people - - is that. Anyways, let's really get into this, because one of the things in Matt's thing-
Blake Oliver: Get into what? 
David Leary: -about the ... The Disney thing. 
Blake Oliver: Oh, okay [crosstalk] We're going out strong here with something completely related to accounting. 
David Leary: So Disney+  launched ... You talked about it; Disney+ launched, and it's super-hot. 
Blake Oliver: Yep. It's their own streaming service to compete against Netflix.
David Leary: Exactly. [00:52:00] But, to do this, Disney has basically pulled all the Disney movies and shows from all the other streaming services. They pulled all the Marvel properties. They pulled all the Star Wars properties-
Blake Oliver: Pixar.
David Leary: -and they're all on their service. Now, you're seeing things where Netflix is gonna lose The Office, and Friends. They're moving to a different one. But apparently, Seinfeld's gonna be on Netflix now. It's kinda getting messy ... The content [00:52:30] is driving which services you're gonna subscribe to. My kids are kinda past the  Disney stage. I might not sign up for Disney+, but I tell you what, a decade ago, I would have been one of the 10 million people subscribing to Disney+.
Blake Oliver: Right. 
David Leary: It has me thinking more about these apps and the platforms. Right now, we live pretty much in an open ecosystem. Streaming was kinda like that. The same show would be on every streaming service at one time. But what happens if some of the major platforms- things start getting exclusive? Where it's [00:53:00] interesting- 
Blake Oliver: So, you're talking about more broadly, or what?
David Leary: More for us, in our world. I find it really, really interesting with more of the niche apps. Because, if I'm on a time-sheet app - it's a commodity or an expense-tracking app - and let's say it does an exclusive deal with some accounting-software package. There's 50 other apps like that. It's not a big deal. I can just swap out a time-sheet app for a time-sheet app. 
Blake Oliver: Mm-hmm. 
David Leary: But if I'm using more of an industry specific app, like Clio law firm software, or Ekos Brewmaster for my brewery, [00:53:30] or I'm using Buildertrend for my construction company ... That's really the software I run my business on. Now, all of a sudden, there's a deal where that software only works with a certain GL? People are going to move GLs just like they're gonna move from Netflix to Disney because of the content that's on that service- 
Blake Oliver: Oh, but wait, wait ... You just made a statement that's impossible to defend. Moving from one general-ledger application to another is way more painful than moving from one streaming service to [00:54:00] another.
David Leary: But if the app you're using to run your business, the real app you're using, which is gonna be more of an industry specific niche app - it's not the GL ... We talked about this a couple weeks ago - GL as a Service, right? GLs are kind of ...  Everybody's gonna be able to build a GL-
Blake Oliver: Oh, no ... I don't think that either. It's way harder ... 
David Leary: Yeah, yeah, yeah, it's way harder. I get it, I get it, I get it, but- 
Blake Oliver: Takes years.
David Leary: -are we gonna see a similar ... Could this happen in our space, I guess, right? Where this exclusivity comes like this- 
Blake Oliver: I think what could happen [00:54:30] is that you won't ... Well, first of all, QuickBooks Online's and Xero's ecosystems are not completely open. You have to apply, and they can deny you. They just happen to be pretty liberal about who they let in if they meet the security requirements and whatnot. So, it's not a free-for-all. It's an open API, but you still have to get approved to join. I think [crosstalk] 
David Leary: Well, on the QuickBooks side, I can't ... I think on the Xero side, you have to get approved just to get [00:55:00] to use it, but on the QuickBooks side, anybody can use the API. Now, to get it on the store, you have to jump through a little bit of hoops, but it's a hundred-percent open-
Blake Oliver: So, anyone can get into the API? 
David Leary: Yeah.
Blake Oliver: There's no- there's no vetting at all?
David Leary: The only [inaudible] that probably can't, or will never, is probably Xero [crosstalk] 
Blake Oliver: Well, yeah, so there is a way to stop ... Yeah, there is a means in which they can stop people from accessing it. I just think that what we might see is that we might see more exclusive sets [00:55:30] of apps, like app stacks. And, in that case, I think the business owners will get into that ecosystem, that mini app stack, and they'll either have to be happy with it, or they'll go somewhere else ... This is the problem that Netflix has is that there's not much stickiness when it comes to streaming. Whereas, in the accounting world, in the banking world, there's so much stickiness because it is so painful to rip out a GL, or a payroll system, or an invoicing system, and [00:56:00] replace that with something else.
David Leary: Are we seeing the pendulum swing a little bit more towards all-in-one platforms again, or is it gonna be closed? Choice is gonna win in the long run ... Is choice gonna win or are closed ecosystems and all-in-one platforms gonna win?
Blake Oliver: I think choice wins in the long run because the more apps that you integrate with successfully, the more potential users you have. We've seen closed systems, or all-in-one solutions don't provide [00:56:30] what everybody needs. You get 80 percent of the functionality, and ... 
David Leary: I think we're seeing that with streaming, because you're already seeing rumblings of, like, why do I have ... I have to subscribe to like five streaming services now, and then trying to find the show I wanna watch because it jumps around in each service? People are starting to rebel against this to where maybe the pendulum- it hasn't swung yet, but it might swing back to the other way where people [crosstalk]
Blake Oliver: All-in-one? 
David Leary: -these streaming services are gonna have to be a little bit more open.
Blake Oliver: Think about it this way - a streaming service, to me, is like a channel that we used to have in cable. Cable actually is the ultimate all-in-one.
David Leary: Yeah. [00:57:00]
Blake Oliver: And nobody likes cable because nobody ... All-in-one sucks. So, with streaming services, you get to pick and choose. Maybe somebody will come up with a way to manage all your streaming services. There's already sites where you can go that will tell you what to watch and where you can watch it.
David Leary: Yeah, yeah. We use that occasionally. Yep.  
Blake Oliver: So, it solves that problem. Actually Apple TV does that. You search for a show, and it'll say, "Oh, you can watch this on Netflix, on Hulu ..." 
David Leary: Xbox does that, too. 
Blake Oliver: Yeah, so it's being solved for. It's an interesting parallel or comparison. I [00:57:30] guess the big difference is it's a lot easier to switch a streaming service; although maybe they'll figure how to make those more sticky, too. You do lose your viewing history if you go somewhere else.
David Leary: Yes, that's true. So, I guess, on that note, we've brought the whole show back to Disney, after you talked about it at the beginning of the episode, so ... 
Blake Oliver: Well, David, it's been great chatting with you, catching up on the news. I'm gonna be at Digital CPA Conference in Seattle in December. I wanted to make [00:58:00] sure that I didn't forget to mention that. Are you gonna be anywhere the rest of the year, or are you in Tucson?  
David Leary: I don't think so. I do not think I'm going anywhere. I might ... Next Thursday, apparently, there's a Xero Road Show, or a Xero meet-up, or there's QBO in the Valley, up in Phoenix. I might try to ... There's some sort of get-together that's related to our industry in Phoenix next week, but I just can't get up there on a Thursday night. So, I'm hoping maybe I'll meet some people out, maybe in Phoenix, on Thanksgiving evening when I'm up there.
Blake Oliver: As always, you can find me [00:58:30] on Twitter. I'm @BlakeTOliver or connect with me on LinkedIn. How about you, David?
David Leary: I'm @DavidLeary. You can find The Cloud Accounting Podcast on all the socials, including Instagram. Blake finally got ... We got our Instagram account set up. Blake has been Instagramming away, as a true millennial would- 
Blake Oliver: David, you have to take a picture of yourself in the closet right now and post it. Everybody wants to see what it looks like.
David Leary: On Instagram? Okay ... 
Blake Oliver: Yeah, do it on Instagram. That's coming at you. Don't forget [crosstalk] while David is [00:59:00] Instagramming, go to our site and leave a review. Actually, don't go to our site. Go to iTunes or Apple Podcasts is now what it's called. Go to Apple Podcasts or go to ... What's the other site where people can leave a review, David? 
David Leary: Podchaser.
Blake Oliver: Go to Leave a review- 
David Leary: The nice thing about Podchaser, too, is you can leave reviews there, and you can see all the guests that have ever been on. You can quickly drill down on them and see other podcasts they've been on. And you [00:59:30] can access our merch store all on the same site, which is very, very convenient. 
Blake Oliver: Check out Leave us a review, and we will read it on the air.
David Leary: I don't know how to change to ... Oh, maybe I found it ... The Cloud Accounting Podcast Instagram. Okay, I found it. Okay, now I've gotta hit the (+) sign to take a picture ... I wanna make this happen! 
Blake Oliver: Do you know how to [crosstalk] flip the camera around, or do you need my help with that, David? 
David Leary: Do we want it to be a selfie? All right. 
Blake Oliver: Yeah, it should be a selfie of you. I've actually never seen what it looks like. I wanna see-
David Leary: Hold on. Let me make sure there's nothing that should not be in a [01:00:00] photo that's in the closet. I think this is all photo-safe type stuff. I think I got it. Then, I gotta do what? Put some sorta filter on it? I did a black-and-white filter just for this one. We're gonna share this to Facebook, too, I guess. Sure. All right. I think I did it. So, I Instagrammed from our account.
Blake Oliver: Let's see what it looks like. There you are! I see you!
David Leary: It worked! 
Blake Oliver: It's great! Looks good. Oh, that's great. David, you've made my day.
David Leary: On that note, we're [01:00:30] out.

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