Ben Taylor, founder and CEO of SoftLedger, decided to take a common pain point (month-end close) and turn it into accounting software for mid-sized companies.
SoftLedger stands out from competitors as a cloud-native, modern solution.
Ben thinks that as automation becomes more prevalent in accounting, there will be less focus on the actual number crunching and more on how to make decisions with the data.
Sometimes it’s the greatest pain points that create the biggest innovations.
When Ben Taylor worked as a CPA and corporate accountant, he found himself continually frustrated by the length of time it took to get month-end financial statements out.
“At the company where I was working, in a corporate accounting department, it took forever to get the financials every month. It just seemed like you were doing this clunky process,” Ben recalls. “It was a problem that could be solved with software.”
So he did exactly that. In 2016, Ben called up an old friend with a computer science background and approached him with his idea: cloud-based accounting software for mid-to-large sized businesses. For companies that are too big for Quickbooks, but too small for the major systems with lengthy implementations, SoftLedger is the perfect fit.
Ben walks through SoftLedger’s journey with Karbon CEO and host Stuart McLeod on episode 60 of the Accounting Leaders Podcast. Besides sharing about the genesis of the company, he also discusses the power of versatility and the future of accounting software.
Now with 10 full-time employees, SoftLedger continues to expand while helping accounting departments through their own growth spurts.
“We provide corporate controllers and CFOs with a great product-focused accounting system. It’s a good option that allows them to get off their small business system quicker, and not have to get a giant accounting system when they don't need it,” Ben explains on the podcast. “It’s right in that sweet spot. For these types of companies, they won't outgrow it.”
And because of SoftLedger’s deep breadth of functionality, its total addressable market (TAM) is larger than average. This is because it serves numerous industries, plus both large and mid-sized companies.
“Every organization on the planet needs to figure out their financial position as fast as possible. By building a general purpose system, it could apply to any organization,” Ben says.
The large TAM was helpful in getting its seed round of investment, a round that Ben’s doing his best to use efficiently. Funded in May of last year, he’s hoping the company will be profitable enough to not need another round of funding anytime soon.
Because SoftLedger was founded much more recently than its main competitors, it has certain advantages that make it more nimble than Intacct or NetSuite, for example. Those companies got their start in the ’90s, but older doesn’t necessarily mean better.
Why? SoftLedger was able to build in the cloud from the get-go, rather than having to reengineer existing systems onto the cloud.
“Because we started building SoftLedger when we did, we could make decisions like building it on cloud-native architecture. It all just means that you can connect more easily to other systems and make it easier to use. It's more flexible,” Ben explains to Stuart.
That versatility is reflected in a number of SoftLedger’s features. Here’s how Ben has integrated flexibility into the system:
Not only did SoftLedger have the capability to account for many types of currency from day one, but it also works with cryptocurrency.
“There's a large swath of industries, but investment management's been a big one for us. A big reason for that is because we handle consolidation for multiple entities easily, including multiple currencies. Another big niche that we have is any companies that have crypto assets in their operations. We have a unique set of functionality around those,” Ben says on the podcast.
When the pandemic struck, SoftLedger was well-equipped to handle the storm for its users. Often with larger accounting software systems, a VPN is required to securely get into the database remotely. Not for SoftLedger.
Since it’s cloud-native and accessible from any web browser, SoftLedger required virtually no adjustments during the pandemic.
“[COVID-19] pushed companies to be more automated and to be more open to knowing that they need to prepare for their people being everywhere. They need to be able to easily access their application, their books and records from any web browser,” Ben shares.
Another feature that makes SoftLedger more nimble than its competitors is its quick implementation.
Accounting departments of mid-sized businesses usually aren’t very large and don’t scale up when the company scales up. Implementation of the larger accounting software systems can take months and hundreds of thousands of dollars.
But for SoftLedger, it’s more of a plug-and-play situation, keeping in mind a mid-size company’s constraints.
Recommended reading: Why you need accounting workflow software
So where does Ben think accounting software is heading? Further and further into automation.
“It's all about doing more with less (or the same) as you automate more. As transaction volume increases, and your staff size remains the same, you need to think about being analytical more than checking every individual document.”
Once tasks are automated, accountants will be able to focus on the bigger picture and engage in more advisory work. Ben sees a future where the monthly close won’t be as big of a focus. Instead, the data from the monthly close will become the more relevant information used to make decisions rather than just data for data’s sake.
There will always be things that go to the backburner for any founder. Even seven years after launching in 2016, SoftLedger is no exception to that. Ben says that the company is just now getting to some of the goals that they had at the very beginning.
But as it continues to grow, Ben wants to keep the focus on serving the customer first.
“Just growing, getting more customers, getting the things out that are important to our current customers. Those are the things that I'm really excited about in the near term.”