New banks

‘They’re all numbers anyway,’ Digits wants to change the way small businesses manage their finances

  • Today, most small businesses rely on external financial experts to help with their finances.
  • Digits hopes to change that with its AI-fueled dashboard. That could leave certain careers with a blurry future.
close

Email a Friend

‘They’re all numbers anyway,’ Digits wants to change the way small businesses manage their finances

2021 may turn out to be a big year for small businesses. 60% of small business owners expect revenue to increase this year, according to a report by Bank of America.

It may also be a big year for fintechs zeroing in on small businesses. 62% of small businesses say they’ve adopted more digital tools and methods as a result of the pandemic, according to the same report.

On that note, Digits, founded in 2018, is an AI based expense monitoring platform focused on SMBs. It aims to provide an alternative to the schlep small business owners face when dealing with the ins and outs of their financials.

Often, entrepreneurs work with external bookkeepers and accountants to manage their finances. But it usually takes a while for these financial experts to get back to them because they have many other clients. That means by the time accounting and booking get to the entrepreneur, a financial problem may have already escalated into a bigger one.

“If you’re a business owner, by the time you get to April’s numbers, you’re not worried about April — you’re worried about June,” said Jeff Seibert, co-founder of Digits. “And you feel like you’re always behind the times just because of how the whole system is set up.” 

Digits’ other co-founder Wayne Chang compares how the platform works to using an MRI machine. Through an MRI scan, you’re able to see how the body is working in real time and how one organ affects the other. The platform is designed to do the same thing for a business, he said.

“For the first time you’re able to immediately see the flow and the impact of different changes as they have occurred, as it happens,” said Chang.

The dashboard does things like categorize transactions and provide statistical analysis so that business owners know how they’re spending, where they’re spending the most, and where they can save. 

There are other features, as well. For example, the platform integrates with QuickBooks, so that if the business owner has a QuickBooks account, there isn’t so much set-up required. There’s also built-in collaboration, which lets users comment on transactions within the platform to ask teammates for more information, or share specific transactions with accountants directly. 

For now, Digits allows users to connect accounts from around 9,000 banks and financial institutions. 

SPONSORED

But there have been some challenges for the company, including dealing with siloed data. A business owner may use a different provider for each part of their business, like payroll and revenue. But that can create some tangles when they try to zero in on a specific data point and can’t find it or locate it. And with new modern solutions popping up, the spread of this data has become even wider.

“As software has modernized, we’ve seen all of these companies try to break that up and build better solutions. And they have. Each of these tools is easier to use,” said Seibert. “But it’s resulted in this new problem where your data is everywhere, and you can’t make sense of it.”

A few weeks ago, Digits released its newest service, called Digits Search. The new tool functions like a typical search engine within the platform. Users can find a specific transaction by typing whatever it is they can remember about it — even if it’s just a name or a place.

Depending on how well the search engine works, it could leave certain occupations in a tight position.

“Customers have said things like ‘wow, this is better than the team of financial analysts I have,’” said Chang. 

Companies like Digits may present a shift in how and where small businesses turn to handle specific pain points with their finances.

In a world where this type of software is commonplace, it will be interesting to see how accountants, bookkeepers, and financial analysts will fit in.

According to Digits’ founders, no one’s going anywhere — service providers’ toolset is just getting an upgrade.

“Why is it that you need a team of human analysts to pour through data to find out that you shouldn’t have opened that location? Why doesn’t the system just automatically know? They’re all numbers anyways,” said Chang. 

“Our mission is to build these tools so that these professionals finally have access to modern technology, just like any other profession.”

0 comments on “‘They’re all numbers anyway,’ Digits wants to change the way small businesses manage their finances”

New banks

Nerve, a challenger bank for musicians, hopes its cluster of features will entice artists to sign up

  • Launching on September 15, Nerve provides business and savings accounts.
  • The banking app also offers a private networking feature to help musicians make payments and collaborate.
Shehzil Zahid | September 16, 2021
New banks

When you get stuck, you can talk to us’: Albert’s new challenger bank status

  • Through its new checking account, Albert stands out as a challenger bank that promises immediate access to human financial experts.
  • But promising both quality and speed when your service is based on human expertise could be tricky.
Rivka Abramson | August 30, 2021
New banks

‘If you understand where people fail, you can do things to prevent them’: Can prize-linked savings help people save?

  • Yotta is bringing prize-linked savings to the US.
  • But a model where how much you win is determined by how much you can spend will have its obstacles.
Rivka Abramson | August 19, 2021
New banks

Is banking the creator economy an untapped market?

  • A $100 billion+ market, the creator economy represents a major opportunity for financial services to zero in on.
  • A handful of fintechs have started to offer financial services tailored for creators and influencers.
Ismail Umar | August 11, 2021
New banks

Challenger bank Majority niches down to bank minority communities in the U.S.

  • Challenger bank Majority aims to bank US migrants, with perks specifically appealing to this segment of the population.
  • But building a range of services that are both community specific, and just plain old human-specific can be tricky.
Rivka Abramson | August 09, 2021
More Articles