Interview with: Ryan Lazanis, Xen Master of Xen Accounting

Sean Kolenkom. Senior Edi­tor, Mar­ket­ing at Procu­rify writes: We caught up with Ryan Laza­nis, founder of Xen Account­ing, recently to talk about the power of cloud tech­nol­ogy and its role in the often-dated account­ing space. Here’s what he had to say.

Q) First things first – can you intro­duce your­self and explain what Xen Account­ing does?

A) I’m Ryan Laza­nis, founder of Xen Account­ing. We are a fully cloud-based, paper­less char­tered account­ing firm. We are geared for tech-savvy entre­pre­neurs and small busi­nesses in the tech space. It’s really about lever­ag­ing and using the tech­nol­ogy avail­able to us to help auto­mate the day-to-day account­ing as much as pos­si­ble. At our core, we offer your typ­i­cal tax plan­ning and busi­ness con­sult­ing ser­vices but we put a heavy empha­sis on the cloud by tak­ing your account­ing fully to the cloud.

Q) Could you describe your pro­fes­sional background?

A) I’m a char­tered accoun­tant (CPA, CA). I came from a very tra­di­tional small account­ing firm. Accoun­tants are typ­i­cal pretty con­ser­v­a­tive and slow to change so I think that’s one of the rea­sons why the indus­try hasn’t moved for­ward even though tech­nol­ogy has. So, I saw a need to move with the times and that’s why I started the firm.

Q) So, the tech­nol­ogy is here, but why the cloud? Why this par­tic­u­lar brand identity?

A) Cloud account­ing isn’t brand new, it exists in other parts of the world but Canada has been slow to adopt this. We are only see­ing the begin­nings of this move­ment hap­pen­ing right now in the coun­try, we are truly at the begin­ning. The account­ing process has, typ­i­cally, been very inef­fi­cient – man­ual account­ing processes and deal­ing with your accoun­tants. But there is tech­nol­ogy and apps you can use to auto­mate things and stream­line things. This is the direc­tion we are headed in.

Q) How big of an impact is cloud account­ing hav­ing on those tra­di­tional ser­vices? Are you see­ing a dent being made?

A) I think what we will see is a total rede­f­i­n­i­tion of what an accoun­tant actu­ally does. Typ­i­cally, an accoun­tant has been more of bean counter, doing man­ual processes, inputting receipts from a busi­ness owner’s shoe­box in an Excel spread­sheet or one-by-one into a desk­top account­ing sys­tem. But now, we can replace the shoe­box with apps and that will stream­line things even fur­ther. So, the accoun­tant isn’t going to be doing those man­ual processes any­more. They can add value in other areas of the business.

Q) The idea of re-defining roles isn’t always the eas­i­est thing to under­stand or accept. What kind of con­cerns have you heard from poten­tial clients and those who are new to cloud account­ing? And what about those who have been accoun­tants for a long time and are com­fort­able in those roles?

A) I think from the client per­spec­tive, they absolutely love it; they don’t care how you are going to do the account­ing. As long as they get the insight into the num­bers that they need, they’re happy. They don’t want to drop doc­u­ments off at their accountant’s office. They don’t want drive to the office just to sign doc­u­ments. They have bet­ter things to do with their time.

The younger gen­er­a­tion of busi­ness own­ers loves this kind of thing. And that is really a mar­ket we are focus­ing on. In terms of the accoun­tants, a lot of them aren’t aware of the stuff going on in cloud account­ing and there is def­i­nitely some resis­tance there. They have been com­fort­able with processes and sys­tems and soft­ware for a long period of time. So, get­ting involved in some­thing like this really takes a very dif­fer­ent mind­set to embrace where this is going. But you will see more pro­gres­sive account­ing firms pop­ping up that will uti­lize this type of technology.

Q) Can you recall a mem­o­rable instance or one of your favourite anec­dotes about a client adopt­ing cloud account­ing and saw that this was the way to go and changed their business?

A) Nearly every client we have brought on board has come from a traditional-type firm. So every client that has come on board has seen a big change. I think the most com­mon exam­ple is that they are sav­ing a lot of time. The first client that we had, right away he was say­ing hours of time each month just from one sim­ple app to replace his shoe­box of receipts. So, right from the get-go I saw there was a big dif­fer­ence from how things have been done and where things are headed. And every sin­gle client is com­ing from that tra­di­tional place and we’re see­ing they are a lot hap­pier with the way things are done now.

Q) How impor­tant is the abil­ity to get a pre­cise, up-to-date look at your num­bers? Speed is just one ben­e­fit, right?

A) The real-time access is a huge ben­e­fit. A lot of time, the busi­ness owner is send­ing doc­u­ments to the accoun­tant through­out the year. After the year-end is gone, after the busi­ness has already gone through the full year, then they see how the busi­ness has per­formed. Unfor­tu­nately it is already too late to make any changes or to pivot – it is too late for that. So, now when you have real-time access, the accoun­tant and the busi­ness owner see the same num­bers at the same time every day, every week, every month and every­one is on the same page. If you need to change course, you can.

Q) So, what are the game-changing aspects of cloud accounting?

A) It is the real-time data, but it is also the pos­si­bil­i­ties of automat­ing your account­ing, to a cer­tain extent. Cloud account­ing soft­ware, the one that I am using in par­tic­u­lar, has an open APIthat allows peo­ple o develop dif­fer­ent apps to inte­grate with it and really get a modular-type approach to your account­ing. So, depend­ing on your busi­ness processes, you might want to auto­mate cer­tain parts and then feed that into your account­ing sys­tem. So, it’s real-time access to the num­bers and that modular-type approach are the two main benefits.

Q) What about your monthly sub­scrip­tion model? How does that com­pare to tra­di­tional account­ing fees? What are the benefits?

A) That’s almost like a SaaS model – that monthly recur­ring rev­enue. That dif­fers from many account­ing firms because they charge that hourly rate. But now you’re see­ing a shift, in my opin­ion, to value pric­ing – so your account­ing work for the year, it will cost a cer­tain amount and you’re not going to be charged every time you write an email or every time there is a phone call. It’s a more dif­fi­cult thing to price, but in the end, clients appre­ci­ate it. It shows you are work­ing with them you’re not there just to bill them.

Q) That’s inter­est­ing. So, there is an ele­ment of trust that comes along with this technology?

A) It’s an on-going rela­tion­ship. I’ve noticed that, where I am now ver­sus where I used to work, I have much closer rela­tion­ship with clients. Even though things are done 100 per cent vir­tu­ally and even though things are done via Skype, web con­fer­ence or on the phone, I feel like I have a closer rela­tion­ship. In smaller firms, you only speak to a busi­ness around year-end. You are not speak­ing to them on an on-going basis. This way you have open dia­logue through­out the year. Being cloud-based make you much more available.

Q) What’s next for both your­self and Xen?

A) We are look­ing to become the thought leader in this space. This is a new space in Canada and we want to estab­lish our­selves as the thought leader in it. And, of course, keep inno­vat­ing as much as pos­si­ble, using the tech­nol­ogy as it becomes avail­able: auto­mate areas of account­ing where applic­a­ble and help make it as effi­cient as pos­si­ble. Things aren’t per­fect yet but they are a lot bet­ter than they used to be and there is a lot of room to grow. We become the first pro­fes­sional account­ing firm in Canada to accept Bit­coin as pay­ments, for example.

It’s paving new ground. There are not many peo­ple in the online account­ing space, it can head in many direc­tions. So, it’s paving a path and inno­vat­ing as much as possible.

www.xenaccounting.com

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