All Aussie Accounting Adventures - Tech Edition
It’s time to hit the road with Amy + Will on their ‘most bodacious’ all Aussie accounting TECH adventures! Run your own accounting firm? Maybe thinking of starting one? Want to get the best advice on what tech to use, as well as how to implement it well? Well, Amy & Will are tapping into their extensive knowledge in the space to give you ALL the tips & tricks to fast-track your technology skillset. So pour a bevvy of choice and join them around the accounting campfire for a good ole’ chat. And remember, be excellent to each other, accounting community humans, and party on, dudes!
All Aussie Accounting Adventures - Tech Edition
The 20-Year Itch: Is Accounting Software Due for a Shake Up?
Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.
The accounting software market has a memory, and it runs about 20 years long. Amy and Will unpack the 20 year itch theory: incumbents get comfy, frustration quietly builds, then a shiny new general ledger rocks up looking like the holy grail. MYOB's server era had its moment. Xero and the cloud rush had theirs. So are we standing at that turning point again, or just having a whinge?
They get candid about what is shifting the mood, from pricing pressure to the value exchange for firms and clients, and a few home truths nobody loves saying out loud. Then the real question: where does the day to day friction actually live? Practice management, work papers, too many apps, too many logins, and all the hours quietly disappearing into the gaps between them.
They wrap with a bet on disruption and some plain advice for the incumbents. Incubate the cannibal, move fast, and do not assume the next 20 years will look anything like the last.
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MUSIC
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PRODUCTION
Dav...
Cold Open And The 20-Year Itch
SPEAKER_02Hey Will.
SPEAKER_07Hello, Amy.
SPEAKER_02How are you doing, buddy? I'm doing well. How are you? Oh, I'm not too bad, not too bad. Although I'm feeling but I'm feeling a bit itchy scratchy. Oh. And no, it's nothing untoward, but that was a horrible intro.
SPEAKER_06Wasn't itchy scratchy uh TV show back in the 90s?
SPEAKER_02Oh, I loved itchy. Yeah.
SPEAKER_06No, that's from The Simpsons. Itchy and Scratchy.
SPEAKER_02Yes. Wow, we're not digressing at all. No, not at all. What are we talking about today, Amy? Why are we here? We are talking about the 20-year itch.
SPEAKER_07Oh, itchy scratchy. Itchy scratchy!
SPEAKER_02I'm a little slow. And I'm the blonde one. Nothing, nothing gets blonde. Okay, let's move on.
SPEAKER_06I had blonde hair once upon a time. Did you really? I had frosted tips. No!
SPEAKER_02Oh my god, I want to see a photo of that so bad. Oh god. Awful. Over share. I can't wait for the photos of that one. Maybe that could be a special additional feature of this episode, Will. Nothing special about it. All right. What are we actually talking about? We're talking about the uh 20-year itch. And this comes from the fact that um is controversial as we always are. Is Zero and the general accounting tech landscape?
SPEAKER_06Oh, we went zero specific, not agnostic. I went zero specific. Are we making an assumption that Zero is the market leader in the accounting software space?
SPEAKER_02In the Australian in the AU market, I would st I would say that it is. Been 20 years? No, it hasn't, right? And this is why it's interesting. So are we moving into so it's coming up to 20 years? So we're about 18 years now at the moment. I think it is. 18 ish.
SPEAKER_06No, it's been 20, 2006.
SPEAKER_02Or 2009. Or rephrase that. For the Australian market. 2008? Yeah. We're coming at we're coming up to 20 years. So I think we're about 18, 19 years at the moment. Um and it feels like are we moving into like 17 or so years ago, 17, 18 years ago, when my ob had the market share. And everybody was pissy, and everybody hated my ob because it was slow and it was server-based, and there was downtime galore. Every time they did an update, it was like two days out of the office because you couldn't actually do anything, everything came to a grinding halt, and everybody was just shitty about myob and how much it was costing the business, basically.
SPEAKER_06I started my career on myob. I went to many a client's sites and logged in and took the floppy disk and took it back to the office and tried to mess around with it and still got my journals posted around the wrong way anyway. So that was me.
SPEAKER_02And now look at you, you're running an accounting practice. They don't let me post journals anymore. Good call on your team's behalf. Anyway, um, so yeah, about 17, 18 years ago, 17 years ago, give or take, that my ob was very much I'm not saying that my ob as a product was horrible because I think that, you know, Handy had the same issues and APS had the same issues. And you know what I mean? Like, so I think it's Who went first?
SPEAKER_06Can we do the timeline? Because this 20-year itch thing, it's a known phenomenon that every 20 years a GL comes in, a GL disappears, a GL comes in. How many times have we been through this cycle, do you think?
SPEAKER_02Uh I think you probably have a bit more knowledge on this one than I than I do, but Well, what was pre-Myob?
SPEAKER_06There must have been something pre-Sol 6. Oh, yeah, and then Myob acquired Soul 6. So, yeah, like so this this would be the third the third cycle if it does happen again.
SPEAKER_02Correct. It is we're walking into the third cycle in theory, right? So, and this is basically what we wanted to talk about today, which is uh as you say, myob was the incumbent, everybody was pissy, they were getting annoyed, frustrated, and everything, and then zero comes out onto the marketplace, and everybody goes, Oh my god, it's the holy grail! It's cloud, it's cool, it's new, we don't have to rely on local servers and IT providers and things like that. Um, we're really trying to stifle a laugh at this present moment. So shiny. It's so shiny, so shiny. But it was though, it was so shiny. Do we need to go to an intro? Oh, I think we probably should before I get before yeah, we probably should. Let's go to an intro before Amy gets carried away. See you soon.
Why Firms Fled Server Accounting
SPEAKER_02Okay, before I got carried away. You're just so excited to talk about General Ledgers. I know ironic, really, considering how much I love a general ledger. Um but yeah, I just because I was I was there, I was working at an accounting practice when this happened. I was part of one of the very first accounting practices in Melbourne that adopted Zero because Really? Yeah. I did not know this. Yeah, because they were so frustrated with my ob and the downtime and everything that had happened, right?
SPEAKER_06So this is Were you one of the so you're one of the first switches? Yes.
SPEAKER_02When our firm was one of the very first switches.
SPEAKER_06What made them make the decision? Like what was the final nail in the coffin on MYOB?
SPEAKER_02So it was uh at the time it was a four-partner firm. Uh one sort of, you know, moving towards retirement. Um, the other three partners were, you know, you know, in their heyday doing doing really well. And I think the thing that was the straw that broke the camel's back was the amount of downtime that it was costing the business. In terms of every time they had to do a patch, every time they had to do an update, my the basically the servers were down for two days.
SPEAKER_06Full partner firm, that must have been decent size, like team of 30, 40, yeah, yeah.
SPEAKER_02I think there are probably about 30 of us. That's a lot of people to migrate.
SPEAKER_06And so the four partner firm, early days to be switching, kudos to them. Were they big call? Uh were they pleased with the the switch?
SPEAKER_02Uh I think it was, it definitely came with its challenges.
SPEAKER_06Do you do you reckon that we're getting the same questions asked at four partner firms around the country right now as to whether or not the current solutions are fit for purpose? Damn straight we are. We are.
SPEAKER_02Damn straight we are. What are you wearing out there? Well, this is the reason why we're having this conversation today, is because we're trying to work out is Zero going to be, is it going to stand the test of time? Is it going to stand the test of time, or are we at that point where there's going to be another new shiny toy that comes in to solve all of our problems? Which, and I'm not suggesting, please don't misinterpret this, whoever's listening, I'm not suggesting that Zero actually has solved all of our problems, but it definitely shook up the industry. It definitely did make a massive impact to the way that accountants, you know, work.
SPEAKER_06Like I still love the fact that Xero was the first to build a cloud general ledger. I agree. And I would happily hang my hat on that as a claim, and it's been great for the past 20 years. I agree. The desktop server-based approach was a killer, so there's definitely been efficiencies then. But since then, over the past 20 years, I don't really know what's different. Well, yeah, what's changed over the past 20 years other than it's just cloud-based? Like MYB then caught up a little bit, I guess, and QuickBooks came through and has QuickBooks Online. Um, but over the past 20 years, I feel like the only real innovation has been cloud-based. I don't really know if any of the existing general editor solutions really have that much AI machine learning happening uh in their platforms to the extent that they maybe could. Yeah. And perhaps that's why there is this open question as to are these existing incumbents capable of carrying the torch into the next 20 years.
SPEAKER_02Well, it's but it's also more than that, right? It's now, you know, the mumblings and the grumblings that we hear that I hear in the marketplace or that are around are things like, well, how can a platform like Zero continue to charge You went pricing? I did more for a product which, with all due respect, hasn't developed that much. It's evolved, yes. Definitely it is evolved. Um but you know, has it actually has it done anything groundbreaking or new?
SPEAKER_06So we reckon that there's general feeling that the value exchange between the value that Zero is recouping from us as practitioners and our clients versus the value that they are delivering, maybe the value exchange is not quite in balance anymore. I I think once upon a time it definitely was. 100%. But right now there is definitely that pause, which is on the client side, especially new clients and anyone that is not yet using Xero, or when they're adding a new entity into their group, into their portfolio, whether they're going to run the trust and connect up bank feeds and have that investment entity. I don't know if the value exchange on getting onto zero is a slam dunk for clients anymore and it's causing for pause in the practice, which is putting a risk that practices can't be zero exclusive anymore, which means that we can't necessarily bank on the efficiencies of being a single platform practice. I don't really want to go back to the days where we were general ledger agnostic and we would take anyone and anything that came through the door because that that wasn't great for efficiency in our workflow.
SPEAKER_02No, and I agree. Like, you know, on a personal level,
Pricing Pressure And Value Doubts
SPEAKER_02I still think that zero and the zero ecosystem is the way to go at the moment, as it stands today, right? From a cloud integrator perspective, I do think for a firm that hasn't made any changes that are still potentially in the server environment, etc., I do think that it is the way to go right now. However, for how much longer?
SPEAKER_06Do you see firms that haven't switched to zero? Yeah, damn straight, I do. I can just skip the whole 20 years.
SPEAKER_02No, I don't. It's kind of like a major go. I've never actually asked them that. That's funny. But I was gonna say, we still get firms that we help migrate and transition. And that's because, for all intents and purposes, it's not so much the ledger side of things, it's actually more the practice management side of things.
SPEAKER_06Would you encourage a firm to switch to zero now if they haven't yet, or would you sort of take a view of maintain status quo for right now because things might change in the next 24 months?
SPEAKER_02No, I'd still be recommending it. Because I do think that there's still a lot to be said for the efficiency gains that you can that you can actually obtain through the change and the transition across. Because it it forces you to it forces you to clean up what you've got, it forces you to reimagine your processes and your procedures, it forces you to evolve as a business owner and in the way that you are, I guess, doing business with your clients, the way that you're doing business with your team, those kinds of things. So I think that there's still a lot of value. Is it if it was purely a tech piece only? I don't know. I think that you could hold for another 12, 12 to 36 months if you could hold. Because I think that in the AI.
SPEAKER_06Like some firms are still quite efficient, they don't use zero from a practice workflow perspective, they fumble along just fine. It's definitely not as efficient as it could be. We're still running a 30% GPU.
SPEAKER_02Yeah, I guess it depends on what you want as a business owner, though. That's what it comes down to, right? So it depends on what you're chasing.
SPEAKER_06Yep.
SPEAKER_02Do you want more efficiency? Do you not want more efficiency? If you're happy with what you're doing, great. If you want to throw a human being at the problem, because there are so many free and available human beings to throw at problems these days in the accounting industry. Said no one. Um then should be just grab anyone off the street. Just grab anyone off the street. Yeah, definitely, right? Um then yeah. Throw a human, but I think that there is it's a good question to ask. And I I don't believe that people are holding off with transitioning because of the ledger side. I think it's more the practice management side, and I think the reason why they're holding off is because they don't necessarily like what's there at in its present state, but that's not new.
SPEAKER_06Practice management is the main like drawback failure point in in getting people choosing to migrate.
SPEAKER_02Yeah, that'd be that'd be my take. But then equally, I have a fairly blinkered vision, you know, viewpoint at the moment because of what I focus on.
SPEAKER_06But I agree, like we we have tried to run on a zero first stack, and there's definitely failure points and points of frustration throughout our workflow that we're just kind of like sitting here waiting for someone to come along and go, can you fix this? It's just I don't know, I really don't like having too many apps in the workflow. That frustrates me. If zero and spoken like a true accountant will. I know, but I don't know, is that the wrong thing? Is that the wrong attitude? Like, should we be more open to putting more apps into plugging our workflow?
SPEAKER_02Yes and no. I think that I think that what I would love to see some of the apps out there just double down on and do the things that they do really well rather than doing evolutions of features and functions and doing them half baked, that'd be really nice, but anyway, and therefore that creates confusion because there's so much crossover of functionality and things like that.
SPEAKER_06But we're very frustrated at tech companies right now, aren't we? Aren't we just where's that where's that come from? Is it because we feel like tech is more or innovation is more accessible than it's ever been? And like with AI, there's more people coming
Practice Management Friction Points
SPEAKER_06to the party building their own solutions. And do we feel like these incumbents are just too slow to move at the speed of innovation around the accounting industry?
SPEAKER_02Yeah, maybe. I think there's also an element of I guess I'm tired of people just going, well, I can build that, or I can do that, or I can do this, or I can do that. I'm like, well, so go and do it.
SPEAKER_06Is anyone doing it?
SPEAKER_02Well, I feel like there are a couple of people that have given it a crack.
SPEAKER_06There was an article that we just looked at today.
SPEAKER_02No, it came up uh back in February. Um by a guy called Luke Hopewell. Um he wrote an article in February just about the whole um if Zero isn't going to, you know, um do well in terms of creating their general ledger, then bugger it. I'll use AI and I'll create it. Uh now the article, it was his good article. He basically went through and told us what he actually built. And the outcome was it kind of did bits, but it doesn't. Just for his use case. Exactly, just for his use case. Yes, just to preface this. Um just for his use case. And it kind of did bits and pieces, which is great. But I mean, I think that there are also a lot of people that are currently sitting there going, well, let AI do it, let Claude do it, let this do it, and let's just create our own damn thing. It's like, okay, there are AI can do a lot of things. Same as, you know, the efficiency gains when the cloud came out and everyone was like, oh my god, this thing's amazing! AI is the same and better, definitely it's better, but it's still not the holy grail that everybody thinks is going to solve all the world's problems.
SPEAKER_06I agree. I think it's accessible, but it's not easy. It's still damn hard and complicated to leverage AI to get to the end point or the solution that you want. Yep. You really have to push through barriers and hurdles and work through things that you hadn't anticipated along the way, and you have to be skilled at navigating that. You need your tool stack, you need to be so good at being able to navigate dev tools as almost like an engineer to know how to architect something that could be marketed to others. And so when you look at it from that perspective, you go, all right, well, I still back VC funded or um cash flow people that have raised money to be able to go and build a solution or an incumbent that invests in a new platform or advancing their own platform. I back them over Joe and Jane in the corner of the office playing with clawed code, going, I can build a general ledger solution. Look at this bang, bang, bang, bang, and it'd be done in an afternoon. I just don't think that's viable.
SPEAKER_02Yeah, but you know the other thing that I don't think is viable is what's going to end up happening is back in the day when somebody did that, they could then go, this is a thing. I'm gonna turn this into a product and I'm gonna sell this and I'm gonna make it integrate with all these other apps. I don't know that there's going to be that ability anymore because I think that everybody now has the ability to create apps. Again, not easily based on exactly what you just said, but there is We're still missing a central platform. Yeah, definitely. But there's a lot more opportunity to create apps and or things like that. But is there going to be the opportunity to turn them into a commercially viable product to on the sale to others? That's what I agree with you. No, I agree with you. I agree with you. I think build your own yeah, build your own for yourself. Yeah.
SPEAKER_06If it helps you deliver a service around it that's specific to a niche or your clients or the way that you work, sure, there's opportunity there. But I don't think I don't know if you could go around and sell your dashboard insights tool to other firms. I feel like people are just gonna, it's gonna be so accessible that you might as well just go and develop your own that's specific to your
Can AI Build A Ledger
SPEAKER_06practice.
SPEAKER_02Is that maybe, I don't know. You know what? Let's pause. Let's hear from our wonderful sponsors for a moment. They'll solve it for us. This episode is brought to you by Tax Fitness, the advisory platform specifically designed for compliance-focused firms.
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SPEAKER_05Ellie, uh, if you have been paying attention to any kind of news lately, you would have seen that there are some significant cybersecurity challenges that go on in the world around us. Not for big guys, but for little guys and everybody in between. Whether it's hackers trying to get access to our data, whether they're trying to, you know, change passwords, get cash, whatever it is, it's it is real, it is here, and it's something that as accountants we really need to be aware of, right?
SPEAKER_01100%. And that's why it's all in. We have Practice Protect. It is the foundation on which we stand in our cloud solutions. It offers superior cybersecurity for the modern accounting firm, right? Which is us, right?
SPEAKER_04Superior.
SPEAKER_01It tells access to client data, you can manage your risk, you can stay compliant with an all-in-one platform. And a little birdie tells me that some insurers, if you use this product, will give you a discount on insurance. Now, if that's not a reason to use it, I don't know what is. What do you think, Andrew?
SPEAKER_05I think that's incredible. And I believe they have over 6,000 cloud
Sponsors And The Modern Firm Stack
SPEAKER_05integrations and counting. So whatever platform you'll got, they probably can protect it.
SPEAKER_02So your point around will we be able to sell, you know,
One Platform Versus Many Apps
SPEAKER_02this little dashboard that I've built and that kind of thing. I do think it's so funny you say that. I wonder if there is definitely still a market out there though for people who just want to be told. For people who just want it hand delivered to them, that just want it packaged up in a nice little box and go, here you go, just connect it, just turn it on, etc.
SPEAKER_06Yeah, but it's got to there's Again, I don't think people want ten different small-scale solutions in their workflow. Like, yes, it might be the best appetite.
SPEAKER_02But they do if they all talk to each other, and or there's a little robot that does it all.
SPEAKER_06Yeah, oh, okay. Fair point. If it's invisible and it's stitched together as a workflow that you don't actually have to interface with as a user, the like logging in, logging out of multiple platforms is just absolute nightmare throughout the day.
SPEAKER_02I 100% agree with you. And how much time do we per se potentially waste with that? But how many time how much time do we used to waste with, you know, handwriting all of our ledgers and things like that? Not me. Never me.
SPEAKER_07But guilty.
SPEAKER_02Guilty. Uh but you know, well, I mean, how many apps have you got on your phone?
SPEAKER_07Oh, I just did a cull recently, so I'm actually very Yeah, I did.
SPEAKER_06I went through and I went swipe, delete. Um I I don't know how you count the number, but I don't know. What's that? Like 50? Um Yeah, probably.
SPEAKER_02Yeah. More. Okay, you kept on scrolling.
SPEAKER_06There's more. Shit. Most of them are the default Apple ones that you get these days. Sure. Oh my god, I've got ridiculous.
SPEAKER_02I guess where I'm going with this is you have multiple apps to do multiple things and you don't quibble about it when it's on your phone.
SPEAKER_06I probably only use 10 though.
SPEAKER_02Okay. Similar for from a work perspective though, you only use the ones from a work perspective that you have to use.
SPEAKER_06Yes. I'm with you. I just don't want 50 of them. I want three or four. And maybe it's the frustration that I feel like it should be three or four, and it's not three or four. Like, can't someone, can't one of the central platforms just go a little bit deeper and just go all the way? Like, what is it?
SPEAKER_02But this is personal, but this is a personal preference thing, and I think this is why I think the work.
SPEAKER_06We still don't have a work. It's been 20 years in the news cycle, and we s no one has solved work papers. Like, what's that all about?
SPEAKER_02Why do we solve it? Sorry. Who solved work papers? We no, no one has solved work papers because no one ever will solve work papers. We're gonna do an episode on this one specifically, Will. Oh, work papers. And I'll tell you the reason why no one solved it is because every single accountant out there likes to do their own set of work papers in their own specific way, with their own special little bits and pieces. And it's so what's the word, subjective. Every accountant loves to do their work papers in a particular way.
SPEAKER_06Nah, I reckon everyone's trying to figure out. The best way to do it because no one has come along and said, this is the best way to do it. This is how you do it. I reckon work papers is one of the things that most firms would happily fall into line if it was a best thing.
SPEAKER_02But how about the other 20 or so work paper packs or software um software pieces there are out there? They all think that the way that they're doing it is the best way. That's why they created it. But then apparently still nobody thinks that their way is the best way. Because accountants all have a subjective viewpoint in terms of the way that they want their work papers done. Let's not get stuck on work papers because I really want to do that. You know what? It is. We need to do more research. It's a fully dedicated. That is a fully dedicated research. And I'm passing the buck to you, Mr.
SPEAKER_07When I said we need to do more research, I probably meant I need to do more research.
SPEAKER_02Passing the buckly to you, Will, on that one. What a pun! I know, that was really good. That was horrible, Amy. Horrible pun.
SPEAKER_07I'm not going to make jokes about my own last name, no way. Moving on, let's go.
Work Papers And Workflow Reality
SPEAKER_02Alright, so is it, I guess coming back to it though, is are we in a 20-year itch cycle? Like, are we getting to a point where people are starting to get annoyed and frustrated? Because thinking about this practically, XPM that hasn't had a facelift in Well, it's had one now. Oh, no, no, I know that. But it hasn't, it hadn't had a facelift. Because as part of the first firm that I ever worked in, we were the first firm who trialled way back when Workflow Max before Xero had even purchased it.
SPEAKER_06What a good product. It was a great product. It's probably Zero's best acquisition.
SPEAKER_02I wouldn't disagree.
SPEAKER_06Like it's I know, I agree. And they haven't, they've almost not touched it since.
SPEAKER_02I look, they've definitely done bits and I mean I feel like the I feel like the devs listening to this are going to be like, waah!
SPEAKER_07We haven't touched it, we've done things. But is there a dev team on Workflow Max?
SPEAKER_02No, because it doesn't exist anymore, Will, because it got Oh wait, no, practice manager. Practice manager.
SPEAKER_07There is now.
SPEAKER_02There is now, but up until very recently, there was very little that had been done from a development point of view of that piece of software.
SPEAKER_04Correct.
SPEAKER_02Okay. But now all of a sudden, there's been a lot of development done on this particular piece of software. And one needs to wonder why. What's going on? Do we feel like they're they're itching for another price increase? Surely not.
SPEAKER_06Zero couldn't possibly charge for practice tools. Don't be ridiculous.
SPEAKER_02I mean, they could. They haven't to date, but they could. But could they? Well, what should they? Okay, could and should are two very different comp topics of conversation. Could they? 100%. Should they? Debatable. Would you? Good question. Would I pay for zero practice manager in its current state? I don't you know what? Knowing what else is out there, I don't know that I would.
SPEAKER_06I definitely would not pay for practice manager. I don't know that I would. I would pay for tax.
SPEAKER_02Yeah, that's fair. I'd pay for tax, not practice manager. Because I do think that there is a lot to be said for practice management platforms that could, you could use a standalone, which would still save you just as much time by not having them integrated, etc. Having said that, I actually love the fact that it is currently free and it does a lot and it's a piggy in the middle of every conversation of every app that's out there, rightly or wrongly, and I know that every app that connects into it hates it because the API is just the most beautiful thing to work with. Um however, um it's also been like I am eternally grateful for that piece of software. I've said this many a time. I am eternally grateful for that piece of software because I have a business based off of it. And I do think that there is a place for it in the market, how long that will last for. I think that there will always be a place in the market for different sized firms, but I do think that there are other platforms that are coming that are going to develop that are going to leverage off tax. Yes.
SPEAKER_06Off zero tax or off tax as a Well, what else is there? There's like Logit, Logit.
SPEAKER_02Logit, yes, there is Logit. There's Myob Tax, but still not a hundred percent. I mean, I love what the team at My Ob are doing.
SPEAKER_06I actually I have I'm so happy and comfortable with zero tax that I have never strayed outside of that. I know people have reservations of well, it does the job for me. Never have I come across an issue that could zero tax couldn't handle.
SPEAKER_02Yeah, sure. But then there are other more traditional accountants out there that have been using other products, like myob for many, many years. And I would agree that the depth of the pro of the myob product is it it is definitely, it has many more functions and features to a degree if you need that for your practice. If you don't need that for your practice, then zero tax is completely fine.
SPEAKER_06Yeah, like I don't know, I feel like we're a 99% of the market type practice. I just I don't know what the extra use case is for that additional depth that would mean that you couldn't use zero tax. Anyway, I'm happy like someone can show me. Great. I'm open to it because I've never seen it. I'm very happy with zero tax. Out of all the products that are in the zero suite and everything, zero tax is my absolute favourite. And if I had to pay for it, I would. Yeah. Um, and would it change my mind on whether I referred more clients onto Zero? It wouldn't anymore. I'd be like, I'm fine paying for Zero Tax, but Zero is certainly not getting all my general ledger business from my clients anymore, anyway. So you might as well charge for it, Zero.
SPEAKER_02Woo! That's that's controversial. And what I mean by that is what are you using at the moment if you're not using all Zero General Ledger or Ledger files for them?
SPEAKER_06We're not fighting as hard as what we may be used to to try and encourage a client to get off QuickBooks or MyOb or some of the other ones. So we're comfortable playing this is a problem though. We're comfortable now playing in our tax plane. Yep. And if a client wants to handle their own bookkeeping and do their own thing on, I don't know, Zoho books or whatever, as long as we have that conversation with them that says, well, we're a zero-first firm, but we're happy to work with you and accommodate for that. There's just not that much that we can get involved in day to day to help you around your bookkeeping and um any fractional advice or anything like that, just because we're not as familiar with Zoho books. But we're happy to work with you from a tax perspective. But maybe that's a problem. Maybe we're going back to 20 years ago where specific functions were siloed and we weren't as connected to clients and couldn't go deeper into their business because we had to support multiple general ledgers.
SPEAKER_02Yeah.
Xero Practice Tools And Xero Tax
SPEAKER_02So there are a lot of people who probably know this about Amy, but then there are maybe some that don't know that this much about me, which is I'm probably a little bit slower to adopt the whole world of AI than most people. Now I'm not slow in so far as the general population, but in this world I've probably been I've I've I've taken my I've been a little bit more reserved in my excitement around it. Oh, lots of reasons, which I've probably explained in past episodes around AI and bits and pieces. But um, I wonder if the new world of MCPs, do you know what that term is?
SPEAKER_06I don't know what it stands for.
SPEAKER_02Oh, I was told it today and I should really know. Damn it. Uh anyway, it doesn't matter. It kind of is a similar concept to what an API is.
SPEAKER_06Yeah, it's the skills. Like you isn't it just like a an agentix skill. So an MCP is a connector to other softwares and it does the bridging between the two.
SPEAKER_02Yeah. Oh, like an API. Oh, got it. Yeah. Welcome to the party. Welcome to the party. And you said you were slow. Um, so you can basically put, you know, for example, all of the apps out there, if they do have their own little call it an open API, but it's actually an MCP. It allows you to add that to your Claude co-work, affectionately called Claudine for me. Um Claudine, co-work. Um, and you could then build little um little robots, which are not called little robots. Um this is my this is my layman's term. My little robots. My little robots. Uh build a little bot and make it do stuff using the information. So a use case for that would be off the back of my meeting, I've used vinyl as my um my AI note type my AI note taker, and that is connected to ignition via the MCP, and I can basically say tell vinyl to go and create a um based off of the conversation I had, go and create a proposal.
SPEAKER_06Wait, do you need to tell vinyl or does vinyl automatically know from the conversation that it was a follow-up action?
SPEAKER_02Uh I think there's a little column A, a little column B. I think it's column A at the moment, and it's going to be column B. That's pretty sick.
SPEAKER_06So you would like in the call, you would say one of the actions is we're going to be able to do it. Sorry if it's not.
unknownThat's pretty cool.
SPEAKER_02But can you build it if it's not?
SPEAKER_06So to be fair, meeting like AI note-taking is not something that I would have thought is something that deserves a place in the firm's app stack. But when someone goes so when they go so deep into solving a specific problem, they then create a seat at the table or a spot in the workflow. So hats off to vinyl. Um, and they're only young as well.
SPEAKER_02So we're currently we've been using Fireflies, good old Frederick, Freddie Fireflies, because that's his name. I hate it when Fireflies dropped into my meeting. Oh, he's very annoying. Yeah, but I now have Vinny for vinyl. Um, because I need to name everything. I'm original. I know, right? Uh, but I am thoroughly impressed with vinyl at the moment. Like the AI component of it is actually pretty damn cool. And what the guys are building there is actually it's so if you're not on that one, go and check that one out. But I I like it because it's actually probably more accounting industry specific and it's actually thinking like how accountants would use it and trying to connect in with the tools. But back to the concept of the MCP. The reason why I felt like slight tangent.
SPEAKER_07Do you see why I tried to take it away from there? Because I don't know what MCP stands for.
SPEAKER_02You could Google it. Oh my god. Oh my god.
SPEAKER_06Let me find out in one of my 50 apps on my phone.
SPEAKER_02Why don't you, why don't you, why don't you chuck it into Claude and ask Claude what an MCP is. There we go, Claude. Uh it basically, as I say, it would allow you to possibly, if you know how to, if you know what you're doing, you could actually teach it to do some pretty cool skills. And I think that where I was going with saying this is that it opens up if this opens up much more opportunity for people who like to tinker with things like this. And to my point before, around, I think there will always be a market for people who just want to be told and just want to have things given to them and set up for them and told how to use things. I agree, they won't want to go and develop. Spoon feed me. Yeah. Be which it's I'm very happy with. I'm very happy with that. I think that there is definitely going to open up this market of people creating their own workflows, their own workarounds, and not waiting and/or having to rely on each application to develop this particular function and develop this particular integration.
MCP Connectors And AI Automations
SPEAKER_02And I think that's the exciting part from my perspective. Like, I mean, how long have I been waiting for certain applications out there to get off their asses and build really good integrations? Flip side to that is I've loved the pace that every application has developed, but could you do it faster? But I think that the world of AI would help with that. Like there are it should help. Yeah, like I've everybody's trying to solve this problem of capacity. Um, insert previous episode that we just did on capacity. Um, do we like AI should be able to solve that one? But I mean, I know we're tangenting a little bit in relation to this, but I do think that where we're going with this whole thing around the whole 20-year cycle, the 20-year-idge, I feel like we're on the precipice of another transition. I
Betting On The Next Disruptor
SPEAKER_02feel like we definitely are.
SPEAKER_06Do you think one of the existing incumbents has what it takes to ride out the next 20 years as a category leader? Or do you think that for everything you've seen and what you know, do you think that someone's gonna come along and disrupt set incumbents? What's your bet? Yeah, to place a bet.
SPEAKER_02I think something new's gonna come along. Oh juicy! Yeah, I think it is. Um, just so every because we've now model context protocol. Oh yeah. Sorry. I was googling that wasn't anyway. That's what MCP stands for. Uh but um I personally think that something new's gonna come along because there is part of me that wonders if it's too hard or too challenging to change what's already there, but to the pace at which things are being developed, is it gonna be too hard to change what's already there? Is it just quicker and easier just to redevelop something from scratch brand new? Because I know of a few accountants out there that are doing some pretty cool little funky things. What? That are, you know, that it's it's not it's it's doable. It's definitely doable if you have the desire and the passion. Do I recommend it for everyone? Absolutely not, because we don't need every accountant going out there and creating a new piece of tax software. But I do think that there is an opportunity here for someone andor a couple of players in the market to possibly create something in a fairly quick amount of time and you know, roll that out to a fairly large amount of people who might just be a little bit over the world of Zero or Myob or some of the others that still haven't actually moved to the cloud yet. What the hell? Maybe that was their plan all along. Maybe the ones that haven't moved, they knew that it was coming out. We told you. They knew that this was coming, and they were just like, nah, we're just gonna ride out this cloud thing. We're just not gonna transition to the cloud because we know something's gonna happen in 20 years.
SPEAKER_06I knew my handy ledger was gonna be good for 20 years. C for 25 to see will, that's what I'll tell you what I don't want to happen. I don't want Zero to be as slow as what MYOB was in playing catch-up in the role of incomer. If someone new does come along and they do set a new standard for what the market can come to expect and enjoy, I would be really missed opportunity for Zero to not be a very fast follower.
SPEAKER_02I would agree with that 100%. They've got such a large market share in, you know, particularly in the Asia Pacific region.
SPEAKER_06Yeah, well who is not from who's listening from North America in the UK? We got listeners? Yes, we do.
SPEAKER_02Around the world. We do. Holy We definitely have listeners in the UK. Anyway. Um That's great. I've met some of them. Do we have like charts out? Do we yeah, can we get like Yeah, we can definitely get charts real quick.
SPEAKER_06I haven't seen it, I just assumed it was. I'm so sorry, everyone that's outside of Australia. I assume that this was mostly an Australian audience.
SPEAKER_02No, no, no. I mean it is a large proportion of Australian audience, but we definitely have global listeners. And we thank you immensely for being listeners to our podcast and continuing to support us. Um but I yeah, I would agree with you insofar as the whole world of Zero. I would like to ensure that, yeah, I'd like to put a I concur with you all. Just don't be as slow to the party as what other incumbents in the last 20-year cycle were to possibly change their ways.
SPEAKER_06And you know what? I unsolicited advice for MYOB, Zero, QuickBooks, all of the above. I would say if you haven't ring-fenced your own internal labs development team to go and build the adjacent product or the new category entrant, if you if they aren't doing that and they are just trying to reinvent their existing platforms to get them to move faster, I would say that that unsolicited advice, that's a mistake. Yeah. Keep the cannibal in the family, do something radical, make it experimental, place a couple of bets internally. But it is much better for a zero and MIB or an intuit to incubate their own disruptor than it is to just bet the house on the fact that their platform that has been an incumbent for 20 years has what it needs to be able to be the incumbent and leader for the next 20 years. I think you gotta disrupt yourselves, big tech.
SPEAKER_02Yep, I'd agree with that one. So I think just to round
Persistence Advice And Final Take
SPEAKER_02this out, um, I feel like we are at that precipice of the 20-year-itch, and I think that something is definitely, definitely probably going to happen. Um, I think that there is opportunity for people who have half a brain that they could, if they know what they're doing, go and create slash develop something. It's not easy, and I'm not suggesting that it's easy, but I do think that there is a much better opportunity for you to be able to do that without having to have you know years and years of um, you know, coding experience and dev work experience, all the rest of that kind of stuff. I definitely think that it's an opportunity for people who want to do that.
SPEAKER_06I agree, and I um on your point about it not being easy, I think it's the resilience and persistence piece. Yeah. Because you're when you do it, you're gonna get 80% of the way there in 20% of the amount of time, but then you're gonna start to hit hurdles and roadblocks, and you're going to find reasons not to push on and continue. My advice to anyone that wants to do this is when you meet those hurdles, just know that 99% of people that hit that same roadblock are going to shy away and not push through that roadblock. And so if you're the 1% of people that hits that roadblock and finds a way to push through and solve that problem and get to the next roadblock, um, if you do that more than anyone else is going to do it, then I do believe that AI is making it accessible enough for you to be able to succeed without having to go raise $15 million to actually be able to produce that solution. So if you're up for it, um I do believe that it's possible. And I think resilience and persistence is gonna be the most important skill for you rather than subject matter expertise, coding skills. I think it's your ability to persist when others are gonna shy away and give up. Wise words. Wise words, we'll find out. We'll find out.
SPEAKER_02So, 20 year H. It's probably gonna happen. Uh, I think something is going to disrupt the accounting general ledger experience and this tech space. Will it be an incumbent reinventing itself or will it be a new kid on the block? Your final bet will. And will they sponsor this podcast? And yes, who knows? We hope so too. Will we exist? Uh well, are you going with an incumbent or a new kid on the block? What do you reckon?
SPEAKER_06Um, I'm going for a new kid on the block, and I expect the incumbents to respond. Someone will respond quickly whether they acquire them or whether they look to match and take a similar approach. I just I don't think the accounting I don't think the accounting industry wants zero to fail. I think the accounting industry wants zero to succeed, but I think it might actually take a little bit of disruption in the market to inspire Xero to be the best version of themselves for the next 20 years. As I believe they should.
SPEAKER_02Yep, I hope so too. And uh a little competition goes a long way in making people better. So on that note, Will, pleasure as always, buddy. Thank you. Thanks so much. Bye, everybody.
Follow The Show And Share
SPEAKER_00Hey, hey team, it's Allie from All Aussie Accounting Adventures. Thanks for joining us for this tech edition and joining Amy and Will. We hope you've picked up a few great insights and ideas. If you'd like to keep following the adventure, make sure you check out our website and find us all across the socials. We are everywhere, you know us. Just search All Aussie Accounting Adventures. Whether it's conferences, the website, the podcast, social media, there's always something happening with us, so make sure to follow. And don't forget to share the episode with your accounting mates. We love that stuff. So thanks for listening, and we'll see you on the next adventure.