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♪
So when David Barrett says,
every payment is a conversation,
he's right because ultimately with AI,
everything is a conversation.
Everything will be human conversation.
We will be talking to our phones,
and it won't be just to make a statement
that is something scripted out so that it does what we want.
We will just ask the AI to do something,
that's connected to a microphone, and it will do it.
And so we'll expensify.
♪
Welcome to the Cloud Accounting Podcast.
I'm Blake Oliver.
And I'm David Leary.
And we are coming to you live from the on-pay recording studio.
We have just returned from Italia.
We were in Italy at Expensicon.
David, how's your jet lag?
It was bad yesterday.
We had a very long, it was very long flight coming back.
And then I'd go back to the airport again the next day
because one of my battery bags did not make it, so.
Oh, no.
I was worried about that.
I was very concerned.
But we had a good experience, but it is a long flight.
And now, having taken my first trip to Europe,
this was my first trip to Italy, first trip to Europe,
I understand why most Americans actually don't travel abroad
because, man, it takes a long time to get there.
And when you are in economy,
which is how I have the privilege of traveling,
yeah, it gets long.
But- But you stretched it out for next week.
I did basically, it was, Expensicon was a three day conference.
And I put a day of travel on both sides.
So it was like two trips within a five day period.
So it was a- Oh, yeah.
It's a lot on the body.
You had a lot.
So I was just going from here to Italy.
I did a week in advance because I haven't had the chance
to go before and I wanted to really experience it.
So we went to Rome, we went to Sorento,
and then we went to Pulea, which is the heel of Italy.
And it's just south of Barrie
is where the conference was held.
And yeah, it was just spectacular.
The conference was ridiculous.
I don't know if there's-
If we were getting to the conference.
When I went to Italy, I went on a trek
and came back with some accounting and tax knowledge.
Remember I talked about the bankrupt and the desk
and I went and saw Luca Ptolea's birthplace and his statue.
Like, did you learn any accounting things when you're in Italy?
Yeah, I did.
And I have a story about the region that we were in in Pulea.
There are these houses called Truly.
A single Truly is a Trullo, and they are these stone houses
where the roof is made from unmortared stone
that is stacked together.
And the legend has it that in the 1500s
or medieval times or whatever it was
that the taxes were assessed based on dwelling units.
And because this area has a lot of stone,
the landlords told the peasants to construct their homes
with the stone but to make them unmortared
and to stack them in such way that there would be a keystone
at the top of the roof.
And if you pulled out the keystone,
the whole thing would collapse.
And so when they saw the tax collectors coming,
the peasants would all pull out the keystone
and the roof would fall in.
And if there's no roof, there's no dwelling unit.
And if there's no dwelling unit, there's no taxes.
And that's it.
I mean, it's a core story about the houses they used to live in
in this region is related to tax avoidance or tax evasion.
However you want to look at it.
And I think it's very appropriate that that was the area
we were in and that accounting was born in Italy,
double entry accounting was born in Italy.
And we did that conference there.
Yeah, it's a fun story.
So look up the story of the truly and tax evasion.
And I see we've got Hector in the audience.
Hector Garcia, thanks for joining us as we stream today,
a reminder to all our listeners that you can follow our YouTube
channel and get notified when we go live.
And you can chat with us, ask us questions,
you can heckle us, you can just hang with us as we do this.
So great to see you Hector.
All right, David, can we talk about the conference though?
Yeah, let's talk about the conference.
OK, so ridiculous is kind of the word I would use to describe it.
Maybe over the top, I mean, beautiful.
Expensify, the spend management company, the super app,
as they like to call it, the developer of the super app,
I should say.
They put on this conference in Pulia, Italy
at the Borgo Ignatia Resort, which
is this five star resort in Pulia.
It's an incredibly beautiful region and the resort.
And I didn't know this before I went,
but apparently they rented out the whole resort
and invited 100 accountants and accounting thought leaders
to the event with their plus ones
and then a bunch of the Expensify people.
So I think it was three to 400 people at this event.
Yeah, maybe it was.
But yeah, it was four days.
It was hundreds of people, four days.
And there were sessions.
David Barrett spoke, talked about the future
of Expensify.
I got to present a session, which is awesome.
A presentation which I've heard raving reviews about.
I wish I would have saw it.
Thank you.
Well, hopefully we'll get to see the recording,
because they were recording these sessions.
So if there is one, I'll be sure to share it.
It was a new presentation I did on artificial intelligence
and accounting.
A lot of the stuff we talk about here every week.
And George Clooney was the keynote speaker.
So we got to sit in a room with a few hundred people.
And David Barrett interviewed George Clooney
about the work that he and his wife are doing
to help save the planet, which is a big part of Expensify's
mission.
I can't remember exactly.
His foundation is a customer of Expensify.
And that's why he was brought in.
But some of that work he's doing to save the planet,
he and his wife are graphed at these bad guys.
And some part of it they go after is researching the money
flow.
Yes, that was interesting.
And George Clooney has 12 or 14, in fact,
that might be 14 accountants on staff,
investigating fraud and chasing fraudulent money
all over the world.
Forensic accountants.
Criminals.
And it's interesting because I'm glad you brought this up
because he said that they've learned at the Clooney Foundation.
And it doesn't help to shame a dictator or a killer
because they don't have any shame.
So you can take aerial satellite photographs of mass graves
and you can call out the people that they've put in jail
for illegitimate reasons.
But it doesn't actually do anything.
And that what really has made the difference in the years
they've been doing this is tracking the money
and cutting off the sources of funding
and shaming the companies that are doing business
with these dictators.
So the forensic accounting is actually
a really important part of what they do.
And I just loved that.
I never heard that before.
I didn't know that he was doing that.
That's amazing.
No, no.
That was the last thing I expected to come out of his mouth.
Like, oh, by the way, I have this whole team of accountants
tracking down bad money over the world.
The other thing, since we're talking about Clooney,
the other thing I really loved about that interview
was what he said about failure.
And he said, I believe the quote was,
I've never learned anything from being right.
I've never learned anything from being right.
And he talked about how he's failed so many times.
And of course, he made a joke about that Batman and Robin
movie.
And it's like, we all forget about that.
He's such a star and we forget that he has failed and made
stuff that wasn't good.
And he still feels that way.
Every time he does something, it doesn't work.
And so if you are starting a podcast
or you are doing a presentation for a conference
where you are building an accounting practice,
you're going to feel like you're failing a lot of the time.
And that is OK.
And that is normal because the other thing he said,
that was pretty funny, is if you're beating your chest
and you think everything you're doing is great,
usually it sucks.
Those people are the ones who are the worst.
So just a very charming, very charming person.
He came off a lot more down to earth than you thought he would.
Because even before he went up on stage,
he's kind of standing there off the stage.
And you can see him.
And is the term like overly put together, the right term?
But he's almost a statue in a way.
And he's like, oh, gosh, he's going to be stiff.
This is going to be horrible.
And once he got on stage, he loosened up.
He was very laid back, free open and honest about stuff.
And it's pretty good.
Pretty funny, too.
That I think is going to be so funny.
We've got more folks joining us in the live stream.
Hey, Edgar, how you doing?
Hazardous items.
Great to see you hazardous items and your spectacular username.
Hazardous says, thought I'd let the Cloud Accounting guys know,
I finally passed all four parts of the CPA exam.
My next cert is the CMA exam, which is really underrated,
in my opinion.
Congratulations.
Well done.
And I can't believe you're going for CMA as well.
That's quite a lot.
But yeah, go for it.
Congratulations.
Actually done.
So if you want to talk about what was
covering the keynotes, some of the content?
Let's do it.
Let's talk about the phrase, every payment is a conversation.
That's what stuck out to me in David Barrett's keynote
when he was talking about the product and the direction
of Expensify.
Actually, can we just step back for a second, David?
Yeah.
Talk about the first Expensicon.
And do you remember when we went to that?
This is the third one they've done.
The first one, David Barrett got up on staging at a single slide.
I just put to one slide.
He spoke to one side.
He took a long time to build the whole slide.
He built the slide up.
And he basically explained Expensify's entire strategy.
He just laid it out on the table.
And that strategy has guided Expensify to where it is today.
They got thousands and thousands of customers,
and $100 million run rate and 140, 150 employees.
And they can do conferences like this.
But basically, if I had to summarize the original product
vision from Expensify 1, Expensicon 1,
it was, let's create a product that
is just fantastic for the end user
and make expense reporting simple for them.
And anyone can use it.
You don't have to get your CFO or your controller
to sign up for it.
Anyone who needs the final expense report
can pick up Expensify for free and use it and snap a picture
and make an expense report and send it in.
And if enough people at a company do this,
then eventually the accounting and finance team
says, hm, maybe we should look into this.
And then they buy it.
And so I wrote a story after that event called,
I think the headline was Expensify's the Slack of Accounting
because of that grassroots user acquisition strategy.
And that is really something that you don't see a lot in accounting.
A lot of the apps go in top down.
They're designed for the CFO.
They're designed for the CEO.
And so the user experience often sucks for the end user
because they are the last person that the company thinks about.
But it Expensify it's the opposite.
The person using the app is the first person they think about.
And I've always thought about that when I think about product development
and even building our own app, David, when we build earmark,
it's all about the end user.
So at this conference, this third one, David Barrett got up there
and he started out talking about how every payment is a conversation.
And basically, Unveiled announced the new Expensify app.
How would you describe the difference between Expensify now
and what they're building?
Well, so I think the other part of it is vision about, you know,
this like every expense is a conversation or adding context to a transaction, right?
There's always a conversation about the expense report happening somewhere.
Either months before where I'm like,
hey, I've got to get this oven fixed if I'm a restaurant owner.
And there's already a conversation happening somewhere.
Or after the fact.
And the other concept you kind of brings up and fundamentally like over beers
and we're drinking and nerdy talk like you and I,
I can kind of see this vision, right, of that.
An expense report, an invoice, a paycheck,
two roommates that are splitting a bill, like the rent,
it's all an expense report at some level, right?
If I submit an invoice to you,
I mean, it's basically the expenses on my company I'm sending you to pay, right,
in a kind of way.
That's the thing that really resets the expense of my experience is,
he's talking about like eliminating the expense report.
That's what the expense has been built on is creating easy expense reports, right?
And now they want to go one step farther and completely eliminate the expense report
with a chat based interface in the new expense if I app where it's,
we just, David, if we're talking about an expense, we just chat about it.
And then the app facilitates the request and the reimbursement and the payment,
all of that.
And the whole time I kept thinking about how similar this is to chat GPT.
And it's been working on this for a while.
That's the piece that's not there.
You're right, exactly.
So they rolled this out and basically, right now I would say it's like a version of Slack
or Microsoft Teams.
And we saw this, I think, when it's Sage and TAC,
how they made integration with Microsoft Teams.
And an expense report had to be approved and then the approval came through to the chat
and so they could approve it right there on the chat and Microsoft Teams.
And it reflected back in Sage and TAC.
So that's kind of where maybe it's at or it's probably the next steps.
But as I sat there and looked at it, I was like,
oh, it needs to be like full-blown chat GPT style to where it can access old conversations because,
you know, they bring all these accountants and bookkeepers in and show them this,
right? All these accountants, county influencers.
And I think for a lot of these people, especially if they're controllers or virtual controllers,
or we have big clients, they almost couldn't wrap their head around it fully.
Like they're still stuck in the old world of like employee-submits expenses.
I've reviewed the expenses, I've approved the expenses.
And I'm stepping back and I'm like, you don't need any of that.
Because it could just, when an expense gets submitted,
go find the old conversation that we had two months ago,
where you basically said, yes, get the oven fixed, right?
And bring that context forward.
And so it's very obvious, like, that's the next layer into this.
There has to be this chat AI level.
Well, and the way they've built the interface, they could totally layer it in.
They could just like add it in and you really could just have this conversation.
And then all of the expense request reimbursement is handled by the AI.
So it's very visionary to, for them to have thought of this before any of this
chat GPT stuff started to happen.
Like they've been working on this for years, right?
And now we're seeing it happen with chat GPT.
And I guess my question is, what is going to actually do it?
Will Expensify do it again and build this thing that nobody's ever seen before?
Or will, you know, chat GPT just do it, right?
That's the risk that they have.
And I don't know, I mean, I guess you're reluctant to say lightning can strike twice,
right? Or genius can strike twice.
But with Barrett and Expensify, I think they've got a good shot at it.
I agree.
I mean, I've worked with a lot of founders in this space and Barrett's probably
one of the smartest I've ever met, for sure.
Well, some of the other mind-blowing stuff that he talked about is how they're building this new
app. So the reason it's taken a while to get going is that they had to completely rebuild this
thing, the brand new platform, and it's built, it's actually open sourced.
So they've figured out a way where they can hire contract developers to work on specific
features that are not part of Expensify and they can pay them a fixed fee to build something.
And then they can submit the code and add it into the app.
Like it's an open source project.
And that's kind of mind-blowing.
So this is continuing this ability for Expensify to operate with extremely low headcount.
And that's something Expensify has always been famous for.
Yeah. So instead of having going out, like a lot of startups, right?
Oh, they went on hire a thousand engineers.
And now you've got to bring in a bunch of VPs and layers of management to manage a thousand
engineers. And then then you have just a lot of meetings and stuff doesn't get done.
And basically I had to invent a system and a process for them to post,
I'm going to say Fiverr, I don't know if they're using Fiverr, but basically post a problem out
there on Fiverr, specific problem that needs to solve by code, and an engineer can contribute
to their project and get paid for that one little snippet of work they do.
So because of that now with the new Expensify, they've had a thousand different
engineers contribute code to the new Expensify and they didn't have to hire any engineers.
Yeah.
Right. And they're also doing the flip of that with support.
So they have-
Yes. So this is important because-
Major announcements and support.
This is the number one thing that has held back most accounting firms from using Expensify
in their firms over these years is that Expensify has been super lean.
And that means that they didn't have the people to provide the support that accounts
who used to getting from, say, a payroll company where you have an account manager
and you have somebody dedicated to you.
But that was the big announcement, right? David, is they are adding in account managers for accounting
firms?
Yeah. And but the way they're doing it is they're-
Because what they tried to do before is they just had like one email address like help
it Expensify, you know, somebody like that. And every single person that needed help went to the
same spot. So if you had, you know, employees that are looking for the reimbursement, random
employees, because that's the majority the users of Expensify are a bunch of employees.
Right.
Or people getting reimbursed. And so that just floods their support channels, right?
And then you wonder why usually the accountant, you get in the same line and you can't get help.
But instead of going out and hiring 900 call center employees,
it took them a very long time, but they built a complete infrastructure back
end. So it's all through their concierge service.
And concierge does is it's part of a bot. It's part AI. But then there's also humans.
But so basically, but if I contact you contacting me for support and asking me a question,
I'm on the back end, it's going to answer your question. But me, the human is going to be,
yeah, that's the right answer to give to Blake. And I'll click it and send that. So there's like
that level of support on that frontline, then they have a second level of support. And then
then they have human support for the next level. So you as the accountant or bookkeeper will have
your own dedicated and don't quote me on product, account manager, sales manager,
I don't know what the proper terms are, but you'll have somebody and then your client in the client's
employees will have a different support channel of somebody to help that client. So use the accountant,
you can basically have expense if I set up the client for you. It's probably the way to think
about that. And you don't have to actually do the setup. So you have to have a certain number of
clients or end users, like associated with your firm in order to get the account manager.
But I think the number was 10. Is that right? It didn't seem unreasonable. Yeah, it's not
unreasonable. And you can just so if you want that support, you can just pay for the 10 and get the
support. And if expensive, I can do that. If they can provide support that accountants have been
missing, and they can do that and scale without adding too many headcount, I think that it's a
winner. So if you had a bad experience with expense find the past, because they didn't have the
support for you, I would say, take another look. And Joy says, concierge is next level already,
with GPT added, it will be game changer. And I agree, I think if expense if I can add in the AI
and have it do a lot of the frontline support, which I think it certainly could,
then they'll be able to scale. And other companies will model after this when it comes to their
support is chat based support, honestly, is the best. Like David, I prefer chat instead of phone
when I need to have a problem. I only want to do phone support if it can't be resolved via chat.
And as long as it's quick, that's the thing, right? You want to get in the chat queue and have
somebody answering you within a few minutes. The worst thing is when there's a chat and you click
on it and somebody says, we'll be with you in eight hours. I'm like, why do you even offer chat?
Like we live in a world now where you can man that chat 24 hours a day. It's very reasonable for
you to have staff do that. I think the one interesting thing about the way they did this is new expense
five is not done. It's not close to being done. It is arguably. Let's work in progress. I mean,
it's very, very early, but by putting it out there and letting everybody use it, so you had to use
it at the conference, right? People are using it to communicate. And if you want a massage,
you had to use it to book a massage, right? You had to use the app, but it forced,
basically what they did, it forced accountants and bookkeepers to raise all their questions and
concerns. Like, what about this? How's it going to do this? Will this work? Will this work? So really,
what this was is a big feedback session on an unfinished product. Now, expensive, I can take
back and solve these other problems and concerns that everybody has. The one thing though, I think
they're caused is now they've got themselves a dilemma, right? If we think about everybody that
has two products, you always run into this like, okay, now what? And well, the old product, maybe
they're probably going to call it expensive, I classic, they're referencing it as already.
So that's the old expense. All I hear is like, oh, great, 25 years from now, people are still
going to be on expensive, I classic. It's like a quick break desktop scenario all over. And that
could possibly be true in the long term. And the other interesting thing that an accountant
asked was why not just put chat in the old expensive product as it was like a transitional
period. Yeah, and maybe like if you've got chat GPT layered on top of the old expense,
maybe you could just chat with that and then have it do all the stuff in the old one. But yeah,
I agree, it's going to be an issue for them. Listening to some of the product people talk
about how they're going to transition people over you and I were laughing to ourselves knowing that
it's going to take decades before you move everybody over. But you know, I mean, it'll be fine. You
can support that old product and then have the new one be the new expense if I forever.
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Now, the thing that was interesting, David, about all of this was I got this feeling like
expensive eyes like launching a new company. This is almost like a new, I mean, it's called the
new Expensify app, right? This is the new Expensify as a company as well in many ways.
They've still got this really profitable, really successful app, supporting them and providing
the cash flow for them. But it's going to be tough, I think, because they're a public company
and you and I hear this stuff and we see where Expensify is going. But I don't think the markets do
because the first thing when I tweeted out that I was at Expensicon, the first thing that happened
is some random person on Twitter posted the stock price going down over the last two years.
So Expensify went public in, oh, I don't remember when it was, was it 2021? 2020? And since then,
I think it was 2021, yeah, November 2021, their stock price blew up, went up to 40 something.
And ever since then, it has just been on a decline. Now, there's macroeconomic issues there,
right? Like they went public at the high, they timed it really well. But now, they're down to like
$6 and as we record $6 and 64 cents a share. So it's lost 86% of its share value in the past,
however many years that is too, short amount of time. And so the market clearly doesn't
see it. And the question is when will the, like, if you were an investor thinking,
like, do I buy Expensify, right? If you believe that they're going to make this new Expensify
thing happen, you should buy. I don't have any stuff. Yeah, it does feel that way. Like this,
this product is so different. Like you said, they're almost killing their old product in a
weird way over a long enough timeline. But this product is still pretty conceptually high.
And like I said, you and I get it because we're nerds and we talk about this stuff over beers
all the time and Dave Barrett obviously thinks about this all the time. But for the average
person out there, maybe even some in the street, it feels a little crazy. It feels very edgy.
But imagine, what if it was just a startup? Like it was a new startup, it wasn't, you know what I
mean? And they were building this product, people would be going crazy to get it,
right? From an investor standpoint. Well, maybe not right about it. I find ironic.
Yeah, they'd have to be using AI and GPT in their pitch deck, right? To get that money. But yeah,
I mean, so we're going to see, we're going to see what happens. But I really do think like they
were on the right path already. And chat GPT is just solidified for me that chat is. So when
David Barrett says every payment is conversation, he's right because ultimately with AI, everything
is a conversation. Everything will be human conversation. We will be talking to our phones.
And it won't be just to make a statement that is something scripted out so that it does what we
want. We will just ask the AI to do something that's connected to a microphone and it will do it.
And so we'll expensive.
Yeah, because it's like Dave spent the last seven or eight years building the
expensive and all the structures there and how convenient something called chat GPT just shows up.
And it's just going to, it's like the perfect whipped cream. It's the decoration, right?
It's just that little bit they need to add a new expense find and make so much sense.
And this is where the opportunity is is, I don't remember the exact numbers, but they were talking
about the total addressable market. And the market for expense report software is not that big.
In the United States, there are only something like 40,000 mid-market companies out there.
So if you're going for that mid-market and you're trying to be that expense, spend management app,
like you're lucky to get a few thousand customers, right? Which is,
Expensify has thousands of customers now in that larger company space. When I say mid-market,
I'm talking about not these, you know, millions of small businesses that are really just micro
businesses, one person, two people, that sort of thing. I'm talking about businesses with
dozens or hundreds of employees. And thousands of expense reports a week.
Exactly. And so those are the ones that all the traditional companies are going after,
but what Barrett wants to do is go after like all the businesses, including those small ones,
which are impossible to support with traditional enterprise software. Nobody can make the economics
work, but I think Expensify can. So, you know, the question there is with the new Expensify,
right? And you can pay and get paid as a conversation. Is that going to be like Venmo?
Are they milio? All these apps that are out there, they're gaining tons of market share
to help people to pay and get paid. That's what the new Expensify could be in addition to serving
all these bigger businesses too, right? But that's where they say the total addressable market is
millions. Well, I think he said a billion. He's like, I don't want to build, but I don't want
just a couple million people using Expensify. I want a billion people. And globally too, right?
Globally globally, a billion people. Yeah. So, yeah, so that was so much fun.
I did a straw poll. I was just like walking around asking people like, what do you think this
event cost, David? Because it's an accounting conference. Well, they're all counts. Everybody
was doing this math. Everybody's doing the math. So, okay. So, I said, you know, what do you think
this costs? And I think the low number was 2 million and the upper number was 10 million.
And I think the five to 10 million range. I'm thinking five to seven. We didn't ask. We probably
should have asked somebody what it cost. I don't know if they would have told us, but
I know this is what makes me think that might be right, is that a large firm was there.
And one of the partners told me that they did a conference where they brought all the partners
and senior managers and directors out. And it was a lot of people and it ended up being about $10,000
a person for that conference, which I think was of similar duration. And that was in the United
States. So, if there were 300 people there times 10,000, that's 3 million. That would be on the low end,
double that number easily, or maybe even more. So, I think it could easily have been.
And I think I heard a rumor. So, Justin Timberlake got married at the same property.
And now he had, I think he spent $7 to $10 million on his wedding, but he also built them a church
because there was no church to get married in on the property. So, or they built them a church,
something like that. So, yeah, it's somewhere in that range and it does feel kind of crazy.
But I really thought about it a lot. I know for a fact, there are apps out there that are running
half a million to a million dollars a month on Facebook and Google ads. So, they might be spending
$7 to $12 million a year on Facebook and Google ads, which we all know are not very effective
in general. It's very expensive to try to reach accountants. There's not a clear funnel because
accountants take a long time to talk to. So, what they've done is they're spending that money
with a very focused audience. You can't go anywhere. You're in for 10 days.
I would say that most of the attendees here were, I would say, mid-size firms,
attendees from mid-size firms. Top 100 firms were there. I'm smaller ones too. Don't get me wrong.
But I think most of the folks there were top 100.
If you think about everybody, they make the experience so mind-blowing that people are going
to talk about this for the rest of their life. So, if you think about this, maybe they'll do
another expense if I in three or four years, maybe when the new expense five is finished.
Two knows. They'll do another expense at all. But per day, over the next four years,
this is probably a very cheap marketing activity if you start actually eating it out.
You're not going to calculate direct ROI. They're not going to add subscriptions just from this
event. So, that's not the way to think about it. Now, everyone's thinking expense-fied all
these firms. Even people who didn't go are seeing pictures from it saying, okay, what is this
app? That's smart. So, it's another way of doing things completely different. Like you said,
not spending all this money on Facebook ads for leads that never turn into anything.
It's create this amazing experience that generates buzz.
People talk about it. Then, also pairing that with the support improvements.
If they hadn't done that with the support, I would actually have come back from that
conference to say that was a waste of money. That's what I expected, actually.
I expected to go and it would just be a bunch of fluff. They talk all this game.
But if they don't add the support, no accounts are ever going to use it.
But then, we actually talked to Daniel who's in charge of the support and he talked about
everything they're doing. Then, I said to myself, okay, whatever, it's just like,
they're just talking about it. Then, we interviewed BDO.
And we asked them, what is your favorite thing about Expensify?
Expecting them to say something about the product. They said it was the support.
And I thought that was incredible. And more people told us about that.
And these are the larger firms that are getting the new support.
They've got the account managers. And so, if they can do that and activate
these firms, these large firms, and get them to get their clients on,
it's another user acquisition strategy that is outside the norm.
That is not what's traditional.
And so, I love that.
So, I was thinking, every app should also do their same kind of conference like that and
invite David and Blake.
Yeah. I mean, one of these a week for the next 52 weeks, it would be fun.
I would gladly go to varieties of Expensify content experiences and report on them.
That would be not a bad job, David. I was feeling like we kind of made it in a way,
going to that conference after five years of doing this podcast was a really fun thing.
And good ROI for us, honestly. I didn't expect to get a trip to Italy out of doing a podcast.
You never know what's going to happen.
I actually, there's two other aha moments and weren't specific to Expensify,
but that kind of went off on my head when we were there.
One's I attended Clayton Oates's Infinity Game or Infinite Game.
It's the talk. That might not be the exact name of the talk,
but the bell went off for me because he's relating that that there's,
within, there's either people that are playing to win, right?
Or playing the other, there's a winner and loser or they're playing the won game, right?
The infinite game, right?
Which has no winners or losers.
And so if you and the person you're partnering with are not both playing the same game,
there's no hope, right? There's really no hope in that partnership.
And he related this back to you as an account or bookkeeper and the app partners,
the tech partners you're using. And it really considered, you know,
all this time I spent with all these apps and all these things.
And it really hit me. I'm like, yeah, there's apps that show up,
the founders show up. Their motivation is to get an exit, to get rich and get an exit,
and they're gone. If they can sell their company in three years, they're going to do it.
Yep. They're not in it for the long, long game.
And it just, man, that's a good way to, when you look at apps and technology stacks for your firm,
you've got to be thinking that. Is this app in it for the long game?
Yeah. Are they in it to make the world a better place? Are they in it to help you and your clients?
Are they just in it to get subscriptions and then get acquired and then be gone?
And then now you're stuck with an app that's not going to get improved.
That you're stuck on, they get a migrate. And yeah, those are not the companies to partner with.
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And then the other big thing that went off for me is, you know, we've been talking about
accountant shortage, right? And even when Clooney was talking to Dave Barrett about some of the
things Clooney is doing to, at the high school level, to educate people, there's some business
things they're doing like that, I was thinking, you know, in my wife's a counselor, and she goes
to this event, she's like, geez, like, how do you get more students involved in the county?
We've all talked about this. And I was thinking, you know who could do this and probably figure it
out, it would be expensive. Like, they would figure out how to do it, because even if they fail at
getting more people to do accounting, everybody in high school now is going to file expense reports
a decade from now, right? So it's still worth their time getting into high schools and teaching
them accounting maybe. And like, all the companies that could do this, I'd put money on expense
account or expense to solve the high school sexiness of accounting problem. Well, putting on that
conference and getting all those accountants to post on social media, their experience certainly
helps. I think, you know, David, you had a story a few weeks ago, going concerned, Adrian,
that going concerned said that accountants need to spend money, show off their wealth in order to
get young accountants into accounting and expense account, certainly help with that. I mean, on the
last day, David, they, I don't know how they did this, but they got this guy who lives in the area
who owns 88 classic Italian cars to loan them to us so that we could all drive,
we could all drive ourselves in these classic Italian cars to the happy hour that was, you know,
I don't know how far we drove, but if it was like 20 minutes or something, and we're driving along
the countryside, and you know, I had a little Fiat, I mean, it's just, that was amazing, right? Like,
that kind of stuff, I think. And I think we talked about Sarah Laidlaw, if you want to bring up her
or her book here. Oh, yeah. So we've got a few more folks who have joined us from the live stream,
Sarah said, we're still talking about Maui. It's smart to pull accountants together. Yes,
agree. Bring us together and we'll help you figure out what to do with your app,
everything wrong with it, and we'll help you fix it, and we'll share it with the world.
Giles Pearson said, we'll invite you to the account test conference in New Zealand.
Hey, we're in. Please. I would love that. And Kenji has joined. Kenji Kromoto said,
Clayton's presentation was great, very solid analogy on tech partnerships.
Great to see you, Kenji, at the conference. That was awesome.
That was actually one of the good things about this conference is they created
collisions that you can't get at bigger conferences. Like, we've been trying to make friends with
CalCPA's for years. Now we have besties. I have besties at the CalCPA's. You know?
Yeah. No, it was awesome. Yeah, I met a lot of people that are sort of outside of our experience.
I knew maybe like 10% at most 20% of the people there. I think it's got to be 10%.
And so I got to meet a ton of new people, and that was really awesome.
We've got a few interviews that we'll be putting out onto the feed in the future,
some videos from there. There's one thing I wanted to add about Italy, David,
because I've never been to Europe or Italy before, and there were some interesting things,
things I was missing and things that I loved. And I have to say, two things that I loved,
and then maybe you can tell me what you think, David. So I loved contactless payments in Italy.
You can pay with your phone everywhere. I think it's some sort of law that they pass.
Like you have to do it. Like everywhere takes contactless payments. You don't need your wallet.
You can just pay with Apple Pay everywhere. And that was really neat. And there was one other
thing I was going to say, oh, no tipping. I just, I got to say, I like the no tipping.
Yeah. I know you don't get the same service with a smile that you get here, but I feel like the
people working, all the waiters, the staff, everybody working everywhere just seemed a lot more relaxed,
doing their job. They're there to help you, to serve you, but not to like, I don't know.
Get a lot of bongiorno's. Yeah, they're there to do their job, not to like, you know,
make you happy or something like that. And then you land at the American airport,
and you're like, oh, right back to the reality of like nobody caring.
You don't get even a hello, but you still get the thing on the point of sale that says,
please leave a tip. And like you're guilty. Yeah. The tipping at the counter service is like
just ridiculous here. So I really like that. No fans in the bathrooms. That's weird to me.
I don't know if that was just my hotel. I can't even read this. There's no fans in the bathrooms,
but they also have the like emergency pull in all the bathrooms. Like, so like, I think Italians
are very concerned about falling in the bath or the shower because they have those little like,
and it rings a bell somewhere. To pull. Yeah. So I don't know. It's just some interesting differences.
I mean, it was just the food was so good. And the food is unbelievable.
I mean, maybe I'm just, this is me just, this could just be me romanticizing Italy, like, you know,
some dumb American who goes there. But like, I really do feel like the people there are happy.
Like they, they, they could just, they know how to live well. And I think that
we accountants, especially could learn to relax a little bit and enjoy a two hour meal with our
friends and design lives and professional lives that give us that time to enjoy the money we're
making. What's the point of having all that money if you're not enjoying it with your friends and
your family and taking time out and the on the flip side, of course, it's like, you know,
how do you ever get anything done? But I think there's a balance to be struck there.
And it was nice going and getting a new perspective on things. It's one thing to read about it
or watch it on TV. It's another thing to actually go. So I highly recommend everyone go and take a
trip. It's very crowded though, man. This is tourist. You know, the Vatican was just like, I cannot
believe how many people they put through that place. Guess what's not crowded? The statue of
Luca Petoli, you can just go there. There's no tourist around. You could sit there all day by
yourself. Not nobody will bump into you. And for our listeners, I have no idea what Dave is talking
about when he went to Italy on a separate vacation last year, it was last year, he went, he, you went
to the statue of Luca Petoli in some town. Nobody ever goes to, you took a train ride to get there
and you took a picture and you left our card at his feet. So you went to the birthplace of accounting.
Yeah, so you can get away from the tourists. You just have to go to things that are
accounting related. Then nobody's going to be there. Kenji said regarding expense icon that he also
loved the way that Expensified treated and included our plus ones. That was really amazing. Have never
experienced anything like that at another conference. And I would say yes, that's awesome. Oh, my
favorite story about the plus ones is the gentleman who's like, so he's the plus one and he's at the
gate to get on the plane with the attendee who is supposed to come, an accountant. And unfortunately,
the accountant had a passport that was expiring in two months. And so they wouldn't let him on the
plane because your passport has to have an expiration beyond three months to go to Italy.
Which could have been my problem. That almost happened to you. We got my new one. Yes, it would
happen to me. So that happened. And then the plus one, it was a friend. And he said, hey,
you man, if I go, I guess. And the guy's like, I guess. And so he went, he came on his own. So
plus one came on his own, which is just to a conference. And he's like in,
name is Joe from New York and he's in sports strength training. So he did the opposite of
accounting in some ways. And he had a blast. And it was fun. I got to sit with him at lunch.
On one of the excursions. So I think his takeaway is like, accountants don't sleep enough.
And they drink too much. And then your body never recovers. That's right. He was, I asked him,
you know, I asked him like, yeah, we were talking about like my fitness routine. I was trying to
get I was getting free advice, right? When you sit across from a guy who's like training basketball
players for a living, you know, you want to get free eyes? He said like, yeah, if you work out
and then you drink and you go to bed, you're not recovering. And that's why you feel like
crap the next day. So you got to work out and then not drink. It seems kind of obvious, but,
you know, then you'll recover and then you can have fun. So he's like, just make it every other day.
He's not. Yeah. So, um, before we jump into news, I just want to since we're speaking
about conferences, we're starting to wrap up our, you know, the next thing we'll be at is going to
be a S P N gauge. And we have a session we are doing with share files. So we are going to be the
panelists on a, a session called elevate and modernize your client experience. Now, if you want
to come join us at this session, you cannot, you have, you cannot drink on Sunday night and you
cannot stay up because we have a seven AM session on Monday morning at S P N gauge. So
seven a.m. to be there. Oh, dang, David, I think next time before we commit to anything,
we have to find out the time of the session. I think we just said, yeah, that sounds great.
Let's do it. And then they said it would soon will be at that point where we can demand them to
change the whole schedule at S P N gauge around our schedule. That would be great.
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forward slash c l i e n t h u b. Well, David, I've got a segment I'd like to play for you because
there were other accounting conferences that were going on while we were in Italy and where I was
in Italy. And one of them was accounting today's conference. I forget the name of it. Do you have
the name handy? No, it's in San Diego though. I know it was in San Diego. So accounting today
took over the accounting web conference, which, you know, after accounting web went, went under,
they took it over. It's called the firm growth forum, and they did their first one just a week
or two ago. And friend of the show, Kristen Keats was a speaker and an attendee and offered to
do some interviews since we couldn't be there. So I'd like to play for you a few of a video of
Kristen's experience and experience of some other people at the accounting today conference.
Hey, Blake and David, Kristen Keats here, your roving reporter for the cloud accounting podcast.
I know I'm looking a little rough. This is after two days of very intense. Thank you, sir. We're
getting cocktails here. So this is after two days of very intense seminars and training at the
accounting today, firm growth forum conference in San Diego. So at my table here, I've got Randy
Crabtree, who was also a presenter at the conference. I've got Sarah Harris,
now I've got Alison McLeod, and we're here to give you our input on how the conference went.
So without any further ado, let me cross the video to Randy and he can give you his
take on the conference. Hey, guys, happy to be here. Today I was hanging out in the advisory
track, got to see Jody, Grudenden talk, Ed Kless talk. Let's find ways that we can work less and
be more profitable. And so I enjoyed what I saw today. One, it was just a great location. We had
a great time. Two, just the people here. I got here last night and I think I hugged about 30 people.
And just to see these people that I respect and enjoy being around at the conference,
that in general is just an awesome part of conferences. And this conference was up and above,
I thought from that standpoint, the collaborations, the information, the knowledge sharing that happens
outside of the classes is probably just as important and sometimes more important than the classes
itself. It was awesome from that standpoint. I all agree with Randy on that. What I did like
about this conference is they seem to create spaces for that type of interaction. They had
specific networking spaces that were allowed for you to meet other professionals, even though I
didn't like being a subject of the S, the S, experts last night, I got thrown on stage last night. But
I liked that idea of having all the speakers on a stage at the end of the night to have like
lightning rounds of questions. I thought that was really cool. So I think more conferences should do
that. Hey guys, I'm in a passion to Alison. Hello counting friends. I really don't have much to say.
I will say that it's beautiful here in San Diego. And I would say a lot of the conversations that
are going on here at the conference are agreeing conversations that I see and hear in our small
and formal groups. It's nice to connect with colleagues. Hello Sarah Harris here. I was following the
technology track and I was a little disappointed that they weren't more technology focused. They
didn't have a water handle ready for us. And there were a few things like that that were missing. I
think they could expand on next time and do a better job to make this a more beneficial conference for
everybody. Okay, so there we have it. Thanks guys. I'll give you more updates as we get them.
Hey, Blake and David, Kristen again, you're roving cloud accounting podcast recorder here in San
Diego, lovely San Diego at the accounting today firm growth forum. So I've got Jeff and NIO here
with their thoughts. I'll give you my thoughts real quick on this last day. This last day sessions
was actually the best ones. I thought these were very relevant to the profession. They talked about
succession planning. They talked about technology. Joe Wooder did a whole demonstration with chat
GPT that was really super cool. So I was very happy, but I'm going to hand you over to Jeff and he's
going to give you his thoughts. Awesome. Yeah, I think the best day probably was the final date.
I thought the best part of the conference was about the PE and just succession planning and that
most firms don't have any succession planning and that's becoming more a bigger deal for us as we
continue to see people age out of the partnership bracket. So we have great ideas from the entire
panel about what we can do about succession planning, very creative ideas about practice
management. So great, great practice management, succession planning, a session for the last day.
And now the NIO card of great. Funny thing here is I'm actually attending two conferences. I'm
attending the accounting today. Future firm, first mobile, I came to talk firm growth forum
and PASBA, but I decided to come here on the last day to soak up some of this information here
because it seems to be very future focused. So like we're talking about things, we should
prefer them to look like in 10 years. Who is really thinking about that? I know I am NIO. So
to think about succession planning, to think about, you know, adding that new technology to your firms,
house chat, GPT going to impact you, are you talking to your staff about these things and
bringing them into the conversation? Where do you they want to be in three, four, five years?
So all of those things are very relevant to our profession and we have just probably not had the
time or the energy to think about it. So today has been very impactful for me in that way. I
wish you were here, but you all are somewhere else next time. Ann Dolly, so jealous. But we miss you,
but this event was great. So I hope we get to do this again next year. Handing it back over to
my girl, KK. Hey, Blake and David. Okay, this is my last coming at you from accounting today,
San Diego, 2023. I've got Dan Hood here. He put on this whole event. It's been really awesome.
So I'm going to flip it over to him for his final thoughts for the day. All right, cheers.
Just a couple of things. I would tell you there's been a lot of great talk around all the different
topics you'd expect, staffing and all and chaos and technology and all those sorts of things,
but I want to take a step back and say that one of my favorite things about it, and I think the
big lesson is the fact that conversations among accounts are incredibly important.
Counts talking to each other, sharing information. They're one of the few professions that I know of
that really does that on a regular basis, shares things that maybe they shouldn't,
but they're great about it. And there's so much to learn from every other firm in the profession.
Having those conversations is tremendous. We saw a lot of that here. We were very happy on it.
The other thing I would say is sort of a follow on from that is contact and talking with
software vendors. They're eager to work with accounts. They always have been, well, not always,
but for a long time they've been. They're more so than ever. They really want to work closely
with accounts. They really want to serve them well and accounts can learn a lot from them.
And the more connections and conversations there are, they're the better. So those would be my
two big takeaways, but thanks for listening. So this is Peace Out from San Diego. I hope you
guys are having a wonderful time in Italy without us, but we'll hopefully catch you at the
accounting today so much next year. All right. Thank you so much, Chris and Keats for that
roving report from the Accounting Today Conference. If we should get only roving reporters, we don't
have to go to the conferences anymore. Well, but that's the fun part. I know I want to go. I love
the connections are the thing that's so important. We got a couple of reviews and we haven't had
any in a while. So you got those handy, David? We should read them. Want me to jump in? Do you
want to? We got a five-star review and a three-star review. Which one do you want first? I think
I would do the five-star first because we can start. Yeah, then we can talk about it. Let me
transition this into AI chat. Okay, let's do it. All right. So the five-star review, this is on
Apple Podcast. This is from B. Hollows. I must listen to Escalimation Point, Escalimation Point,
Escalimation Point. A great update on current happenings in accounting. I recommend this
podcast on my whole team, Escalimation Point. Thank you so much. That's a great, great review.
Now let's hear the critique. The critique. And I don't even know if this is a critique.
It feels like somebody tried to send us a message and this is the easiest way to do it. So they give
us a nice fair three-star review. It says chat slash AI. I get that the chat AI thing is cool,
but only to an extent. If you guys are talking about it, could pass the CPA, it could one day do
some accountant's jobs, or also the AI doing scripts for videos saving companies money for videos.
This is taking away jobs from people in the future. As someone who wants to get into the
accounting field, this is making me wonder if I should with you guys saying AI could take over
jobs in the future. So this person, this is cheer girl 5102. She's wondering if there's all this AI,
it should she even be in a town. What's the point? She's kind of, that's the vibe I'm getting from
us. I feel like every time we talk about AI or GPT, we have to remind people that if you are
thinking about this stuff, if you're paying attention to it, if you are using it, you're going to be
fine. I'm really, really confident you're going to have a better time with AI than without it.
It's the people who don't embrace it that are going to have trouble. Think about all the people
who didn't learn how to use Word and Excel, and they got phased out of the job market.
But the people who did are more productive. That's going to be the case with AI too.
It's going to make our lives so much better. It already is.
And NPR interview, the concept is that this is going to help save the middle class.
Because the people that aren't going to benefit from chat GPT is going to be the expert lawyer,
or the expert CPA. Because it's just never going to have the same expertise as that expert.
But the entry level CPA, the entry level accountant, the entry level lawyer,
the average, even though they're talking about even tech support employees, they're going to
use chat GPT to augment their skill set to become more valuable as an employee. Which means now
you're more valuable, you can make more money.
Yeah. Now, the doomsday people are saying, oh, it's going to force us to do more work than ever.
We're just going to get asked to do more and more and more. And I just don't... I think we will be
asked to do more eventually. Like if everybody has access to AI all the time, and you can just,
you know, write a prompt and get a bunch of work done. Yeah, you're going to be expected to do more.
But I feel like that won't all flow to the top. A lot of it will flow to us, the knowledge workers.
And we will do more while working less. And that's going to be a win for everyone.
I'm already doing more. My joke in my Expensify session was that I wrote the title and I
asked chat GPT to write the session description. And I gave it some direction and it wrote the
session description. And that's what got selected as a session at Expensicon. I saved myself an
hour or two of work. Maybe not two hours, but sometimes I could puzzle over a session description
for a good long time. Maybe 30 minutes an hour to get it right. And it did it.
I did a presentation yesterday for insightful accountant. And the title of the presentation is
that you can't automate your processes until you document your processes. And some of it was like
retrospectively looking at my own things. Like when you want to document a process or automate it,
like staring at that blank page is just takes forever versus now. And then the webinar I did
yesterday is I used chat GPT to create steps for me. And I would just paste those in a process
street. And then you just go through the refining task, you refine, you tweak your refine, then you
can automate stuff. But I didn't have to start from that blank slate. And it really saved a lot
of time because it would give if I wanted, how do you run payroll or give me the steps to run a
payroll? I just paste that in. And then I refine it to specifically my payroll. But the majority of
the getting started work can be done for you. Yeah. And that saves you time.
Saves a ton. You can be a 10x engineer, you can be a 10x accountant. So don't be afraid of it.
And the best thing you can do is start using it today. Sign up for chat GPT, sign up for bard,
start using Bing in the new Microsoft Edge browser. And that has GPT, you can sign up for that.
Just start using it and start asking questions. If you're nervous, ask it how you can avoid
becoming obsolete as an accountant using AI. And it will give you answers probably better than I
would. Well, I could tell you this, if you lose your jobs in the accountant,
you probably won't be looking at a job at Wendy's. Oh, yeah.
You see that Wendy's is going to, they're working with Google Cloud and they're going to launch AI.
It's called Wendy's Fresh AI further drive through Windows. So you'll talk to
chat GPT or an AI version of that kind of thing. Yeah. To take your order. Yeah.
What a great use of technology. It'll be more accurate. Well, what more amazing about
us thinking about this is the scale, right? And it's meant to talk a lot a bit to this concept
of scaling up, right? Now, if there's 25 cars in the drive-through, they can take 25 orders at
the same time. Yeah. Right. You don't have to. It's not a one person to one car ratio anymore.
Now, obviously, how are you going to cook 25 hamburgers at the same time? But there's a lot
of their building these kitchens to do that now. Right. And if they know the orders, if they've
got all the orders at once, then they can batch the production of these items. And yeah, it's
better to have the information sooner. It's just going to be better. And the real thing to remember
is that there just aren't enough workers for all the jobs right now. And it's going to get worse
and worse in the future. We have a global talent crunch coming. By 2030, there will be a shortage
of something like 85 million white collar workers. That's just office type workers globally.
And the only country in the world that will have a surplus is India. And the surplus is not going
to be enough to cover world demand. So we have to figure out how to automate a lot of this stuff
with AI. And actually, that brings me back to Italy. Because one of the things I learned about
Italy while I was there is that they have a very low birth rate. They are not producing enough
Italians to replace the ones that are there. And so they've got this coming crisis of
people on pensions, which are pretty generous. And they have a pay as you go system. So it's the
current workers that are supporting the retired people. And they've got to figure out how to deal
with that. And automation in office jobs is going to do a lot of it. So, you know, if you're calling
to book an appointment at your doctor, it's probably going to be an AI that books the appointment.
You know, not a person. It doesn't make sense. That person should be assisting with actual
like patients and bringing them in and all that and not just doing administrative stuff. So,
I'm very optimistic. So remember two episodes ago, I think two episodes, maybe one episode ago,
we talked about how chat GPT was set up to fail the CPA exam. We have to talk about this more in
our next episode. We're at a time already. It's an hour. We're at the top of the hour or the end of
the hour. So we'll tease this. Well, so I mean, the answer is like chat GPT four. Actually,
it wasn't chat GPT. It was just GPT four via the API, some researchers doing a proper study
found that it passed the CPA exam. By giving it a little bit more.
They give it up to fail. I guess. Yeah, they gave it the right prompts. And then they gave it a
little bit of training ahead of the actual questions. So like it, they primed it. Okay. But
they compared that to studying. So they basically gave it the equivalent of a chance to study.
And then they gave it the exam and it passed all four. And that's version four. So very soon,
I think we will be using chat agents in our firms and we will be talking to them as if they are
interns and staff accountants. And they're going to be doing and assisting with a lot of the work
that you would delegate to an intern or a staff accountant. And that's going to be so great.
Because if you're a manager and you don't have enough staff, like that's the worst position to
be in. And that's why a lot of people have been quitting because they just got too much work to
do. So it's good news. And maybe I'm just in a good mood because I spent the last two weeks
in Italy. That could be it too. I feel like surprise your energy level after the flight. I was pretty
beat up after our flight home. Oh, yeah, I stayed up and did not go to sleep until last night.
Like local time. And I slept for like eight and a half hours and I feel just great. But I also
drank like half a pot of American coffee, which I haven't had in two weeks. And so I'm kind of
jumping off the walls right now, which is it's fun. But yeah, I'm going to try to slow down. I'm
going to try to work less and accomplish more and enjoy the downtime. That's what we all should do.
I agree. We have a three day weekend coming up. I'm looking fat on a rest a little bit and get
caught up on stuff. Thanks everyone for joining us. Don't forget you can subscribe to us on YouTube,
get notified when we get live and hang out with us. You can also leave us a review. We really
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Send us a voice memo to cloud accounting podcast at earmark CPE.com.
Cloud accounting podcast at earmark CPE.com. And earn free CPE for listening to
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your CPE. That's all I got this week, David. That's it. Always. We can start doing a three-hour show.
There's stuff. We got a ton of stuff to talk about next week. So don't miss next week's episode.
We're going to be catching up on all the news we missed. I mean, yeah, there's so much including
another earnings. Say this that time of the year when zeros it's sage and into its earnings all
overlap kind of. So we could talk about what we see in the earnings reports.
A PWC scandal in Australia. We've got more AI stuff. We've got more features. They're being
built into apps for AI. More stuff on the talent shortage in 150 hours cannot wait.
The ICPA's eight-point plan for the pipeline is now a 12-point plan.
I can't wait to hear what's there. They're adding a point every month is right now, the current average.
David, see you here next week. Bye, everyone. All right. Bye, everybody.
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