Most recently, tech-focused bookkeeping service provider Pilot raised $15 million in a round led by Index Ventures, with US provider botkeeper raising $4.5 million in seed investment in January.
Speaking to The Bookkeeper, Practice Ignition head of accounting and strategic partnerships, Trent McLaren said that these providers were a “sign of the times” as companies seeks to boost revenue through bookkeeping services.
“A lot of people are always looking for silver bullets and if they have been running their business for a while and if they have had a bad experience, then they are more inclined to want to try something that's been wrapped and marketed like a systemised automatic tool as opposed as to trying to find another person or bookkeeper to adjust to them, when they can just sign up online and get started today,” said Mr McLaren.
“Even with a big business that might employ a full-time bookkeeper or accountant and haven't systemised at all, they might consider going to something like a Pilot or a botkeeper where they can effectively scale and not hire 10, 20, 30 staff on day one because they can handle the capacity.
“As the technology gets better, it makes it more appealing for a business owner who can get everything done through an intermediary.”
However, Mr McLaren believes bookkeepers need not necessarily worry by new entrants and the changing nature of competition, but should consider how their marketing approach compares.
“I am very much sure a lot of these firms are just outsourcing it overseas to someone and then building tech around that to support that,” said Mr MacLaren.
“So what these new companies are doing is they are marketing it really well, making it really clean and simple and digestible and really appealing.
“I think the challenge for the bookkeeper, is that they already have all of these tools available to them so there's no reason why they can't actually provide the same service that these new companies are promoting,” he added.
“I think a bookkeeper should be looking at branding and marketing themselves like this because we do all of this stuff already anyway and we're using all of these same tools already anyway.”
Likewise, Institute of Certified Bookkeepers executive director Matthew Addison believes such providers are just competitors entering an already crowded market space.
“The business model is already well established — competent and professional bookkeepers using the best tools available to provide augmented intelligence, or human assisted artificial intelligence to provide the best assistance to business,” said Mr Addison.
“The Australian professional bookkeeping space has been adopting best practices in software and techniques and been on this journey actively for 20 years but arguably longer.”
Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.