Accounting software is (finally) making its way to the cloud. QuickBooks Online, the cloud version of the popular business accounting suite, is firing on all cylinders. Parent company, Intuit recently reported 45 percent year over year subscriber growth
for QuickBooks Online, bringing total subscriber numbers to 3.2 million global users.
It wasn't always clear that Intuit would find its footing online -- it took the company 15 years to achieve its first million subscribers. But the company has found the formula to achieving online growth. With data at is core, Intuit has created a full-blown ecosystem around QuickBooks Online.
Open and closed partner communities
Intuit essentially runs two different partner platforms: one open and one closed. Intuit’s closed platform generally consists of one to three, hand-picked partners in a few categories. For a handful of lucky lenders, Intuit offers the QuickBooks Financing Platform.
Limited in number, these integration partners were offered early access to the growing QuickBooks community of business owners. In 2016, Intuit tapped BlueVine
, a business lender known for its factoring product, to offer credit to QuickBooks customers.
“Intuit really worked hard with its early partners on the platform,” said Eyal Lifshitz, BlueVine’s CEO. “As a company, Intuit really understands the value partners and customers derive from the platform and it actively promotes partners to its customer base. Intuit has a lot of different ways to promote partners, including in its product, through email, and even direct mail.”
For fintech firms, the integration with QuickBooks can provide more than just leads. It enables merchants to do simple things like pre-fill forms. For a factor like BlueVine, being connected to QuickBooks Online becomes part of the actual user experience for its clients, enabling them to submit invoices easily.
“For offerings like our factoring product, the integration is very beneficial to merchants,” said Lifshitz. “Being connected to their QuickBooks Online accounts makes life easier for our customers to manage their factoring facilities.”
Intuit has now facilitated close to $900 million of financing for QuickBooks customers through partners and its own lending facility.
QuickBooks Online, the app store, and influencers
But QuickBooks Online, or QBO as it’s known to industry insiders, also has a vibrant open platform
for third parties. Unlike the lending platform which has less than 10 total partners, the QuickBooks Online app store has hundreds of app providers vying for attention from QBO subscribers. For app publishers, though, they'll have to use marketplace dynamics to find new customers, rather than rely on Intuit for its marketing muscle.
Intuit uses the its app store as a sort of minor leagues, a proving ground to see which apps are taking off. Given what happens in the open platform, Intuit can move forward with more customized partnerships with app providers.
One of the ways Intuit identifies high potential apps is via customer reviews. In fields like online lending, it’s hard for providers to stand out among me-too offerings. Successful app publishers think creatively about sourcing customer reviews on the platform.
“You don’t need to be pushy, but you need to find a way to incorporate getting customer reviews into your processes," said Meredith Wood, vp of content at Fundera
, a marketplace for small business loans.
Three types of apps that perform well in QBO
Fundera’s Wood believes that there are three types of apps that can thrive in the QBO ecosystem. First, apps perform better when the integration with QBO is more core to their functionality. Second, because there is so much competition on the apps store, apps that solve a real core problem tend to do better. Lastly, listing on an app store shouldn’t be a passive activity. Many successful app publishers are active on the platform, courting influencer support and customer reviews.
“On the QBO app store, you get out what you put in,” Wood said.
Submitting an app to the app store is just the first step in penetrating the QBO ecosystem. An influencer community has emerged that app publishers can tap into if they want the support of some of the platform’s thought leaders. This is essential to gain traction.
These influencers are accountants who have applied for Intuit’s ProAdvisor
designation, which provides accounting firms with extra support and more visibility on the platform through business listings in Intuit’s online directory of ProAdvisor accountants.
“What i've noticed is that the ProAdvisor community is instrumental in helping certain apps get traction on the platform,” Wood said. “ProAdvisors are growing accounting firms and they work with so many customers, so they learn to love these apps and that love spreads to their customers.”
How Kruze Consulting upped its game when it joined QBO
As QBO really started to take off, some forward-thinking financial services firms decided to take the plunge. In 2015, Kruze Consulting
, a finance and tax firm for startups, began migrating all its clients over from QuickBooks software to QBO.
In a short time, the firm saw marked growth in its client base and revenues. But it wasn't just the ease of use working with Intuit's cloud solution that moved the needle for Kruze -- it was the APIs and marketplace that changed the rules of the game.
"Everyone focuses on how much better QBO is than Desktop, but when you factor in 3rd party apps like Bill.com and Expensify that leverage the QBO API, then QBO's ecosystem provides 10x the performance improvement," Scott Orn, coo told Tearsheet.
On QBO, Kruze saw a 300 percent lift in its revenues as it grew its active monthly recurring client base from 60 firms to 140.
And as it grew, Kruze incorporated more APIs into its offering, syncing with Gusto for Payroll, TSheets Time Tracking, and Harvest Time Tracking & Invoicing. And some time later this year, Kruze is poised to relaunch its own app
for automated startup tax preparation on to the QBO app store. Given what the firm has learned about the ecosystem, Orn is confident that it can find traction.
Kildal Services goes from local to national on QBO
Stacy Kildal was ahead of the curve as a QuickBooks early adopter. As the owner of Kildal Services
, a Michigan-based bookkeeping service, she first became a ProAdvisor in 2004 for the desktop version of the accounting package. She began actively recommending QBO to her client base all the way back in 2005, going full-in on a remote practice by 2009.
For Kildal, the move to QBO enabled her to free herself and her business up from servicing online local clients solely at their places of work. "It enabled us to reach a wide demographic of prospective clients because we weren't tied to do only on site clients, and back then it was still sort of a hassle to do remote login," she said.
Now, Kildal hosts the QBOShow
, an live online chat where she and other experts answer QuickBooks-related questions.
Getting the most out of the QuickBooks Online platform
Kildal Services and Kruze Consulting are just two examples of how financial services firms can leverage the QBO ecosystem. The common denominator for finding success on the platform is how well newcomers can embed themselves in the existing community.
Whether you're part of a financial services firm or you have your own app on the marketplace, Kruze's Orn recommends becoming actively constructive in helping others on the platform. "If you can help Quickbooks, or an app partner, grow their business you’ll find that they might help you out as well," he said.
Kruze was named by Intuit as a runner up to the "Firm of the Future" awards for North America and benefited from the promotion Intuit did in the wake of the awards on social media.
Similarly, firms that have apps on the marketplace should reach out to top accounting firms to explain their value propositions. Spending time working with influencers can pay off because these entities work with numerous clients. So, if they make the decision to promote an app, they'll bring numerous clients onboard with them.
"My advice is get training, get certified in QuickBooks so you can get listed on findaproadvisor.com
and join some groups in person or online, like BWAM
, which has almost 2000 members on Facebook, to create a network of colleagues that can help you and that you can help as well," Stacy Kildal said.
Intuit didn’t respond to Tearsheet for this story.