Bolster original model
first, then replicate,
experts tell IntelAccount
by Beth Ewen
INTELACCOUNT'S LEADERShave ambitious plans for their two-year-old automated accounts payableservice, which they say can cut the cost of paying bills by as much as70 percent.
Theywant to become the Paychex of the accounts payable world, says CEODavid Crane, referring to the widely used payroll service. His companyis one of three winners of this year?s Upsize Growth Challenge.
About25 clients signed up so far are believers, Crane says; he figures heneeds only about 40 to turn cash-flow positive, which he expects by theend of the summer. He has attracted $500,000 from individual investorsand added his own money to capitalize the firm.
Oneexecutive, Mike Rodich, tells those assembled for the first UpsizeGrowth Challenge workshop that he envisions a $100 million nationalcompany in five years.
CEOCrane, participating via phone from the company?s new New York office,dials back the enthusiasm but still puts out a big number: $48 millionin revenue in that time period is the goal.
Eitherway, the company has some infrastructure work to do, agree the expertswho gathered March 21 to help this year?s three Upsize Growth Challengewinners reach their goals.
?Figureout the model and duplicate it,? says Craig Murphy, partner atMcGladrey & Pullen, the accounting firm in Minneapolis.IntelAccount has had some success offering its services through CPAfirms, and has begun private-labeling its software so such firms canoffer it to clients under their own name.
Murphythinks the smaller CPA firms, not the Big Four, would be amenable to arelationship with such a service, ?because they have the smallbusinesses with the hurt? as clients.
RickWall, CEO of Highland Bank and the contest?s finance expert, urgesCrane and Rodich to invest in a direct sales force, building it toabout 8 to 10 people, and learning from each sales pitch.
?Myperception is you have a very scalable product. You need to build asales force,? Wall says. ?While it does make sense to go throughpartners, you are at a point where you need to do one-by-one selling.?
Herecommends adding professional employers organizations, or PEOs, asanother type of service firm whose clients could benefit fromIntelAccounts? software. Firms that have outsourced human resourcesfunctions to a PEO will likely be amenable to outsourcing an accountspayable function as well.
ElinRaymond, president of The Sage Group in Minneapolis and the UpsizeGrowth Challenge marketing expert, points out that IntelAccount needsto illustrate to customers how accounts payable is causing them pain,something they may not realize.
?You?redoing an educated sell. It takes a little longer. You have to hitpeople over the head. They might not even feel the pain,? she says.
IntelAccounthas a nifty tool on its Web site, an ROI calculator that lets prospectsfigure out how much their current accounts payable system costs, andhow much intelAccount?s service can save. Raymond recommends they gomuch further with the site.
?Putcase studies and client stories on the home page. Pepper clienttestimonials on every page,? she says. IntelAccount should focus mediarelations on each new geographic area they plan to enter. ?Get a medialist and go after them with your story,? she says. Emphasize ?how thisis going to benefit small businesses.?
Adda list of clients, she says, although Crane expresses concern that sucha list would reveal information he?d rather keep confidential. Raymondsays the benefits of such a list far outweigh any negatives.
MicheleVaillancourt, attorney with Winthrop & Weinstine in Minneapolis andthe Upsize Growth Challenge legal expert, thinks such a list would givelaw firms like hers reassurance. ?We make vendor decisions? based onwhich companies other large firms are using. ?Then you get a sense ofcomfort.?
Shewas happy to hear that IntelAccount has addressed its intellectualproperty issues?at least, almost all of them. Although they usedoff-the-shelf software for their product, the integration between thesoftware pieces is protectable.
?The A/P process has been around since the abacus,? Crane points out.
That?strue, Vaillancourt agrees, but the company still has much to protectwith existing products, and will have even more when they implement anew system, something Crane says they?re working on.
?Makesure you have the right agreements with anyone designing? yourproducts. ?The integration part is what you need to protect. Make sureyou have the agreements with that person so you own it,? she advises.
Crane says their agreements are in place with all but one vendor, and Vaillancourt urges him to tie that one up as well.
KirkHoaglund, CEO of Clientek and the contest?s technology expert,continues the theme of shoring up. ?You have aggressive plans to scalethe business and everything has to scale along with it,? he says.
IntelAccount,and all companies that want to get much bigger, faster, should payattention to disaster recovery, resiliency (the amount of time it takesto recover) and redundancy.
Cranesays they?re working on creating a true mirror site to protect againsta system breakdown. Hoaglund says that should be a ?hot? mirror, oractually operational, and located in a different city than theoriginal. ?That?s expensive,? he says. ?But if you?re going to be a$100 million company, it?s not an expense, it?s a requirement.?
David Crane and Mike Rodich, IntelAccount: 612.605.3161; dcrane@intelaccount.com; mrodich@intelaccount.com; www.intelaccount.com[WHAT THE EXPERTS SAY?]
?ABOUT BRANDING
Describing your company succinctly is difficult, IntelAccount?s executives say, and Elin Raymond of The Sage Group agrees that?s difficult for many firms. ?It?s hard to do it when you?re a founder. You see all the seedlings as well as the trees.? Companies should hold focus groups with customers. Ask them, ?What was the key thing that attracted them to you?? Boil down the common themes into key messages.
?ABOUT INTELLECTUAL PROPERTY
?Make sure you have the right agreements with anyone designing? your products, urges Michele Vaillancourt, Winthrop & Weinstine. ?The integration part is what you need to protect? in IntelAcount?s case, but all companies should take this advice: ?Make sure you have the agreements with that person so you own it,? she advises. ?IP is slippery. It?s not like land and you can put a fence around it.”
?ABOUT DATA SECURITY
Every company should schedule a test restore of their information backup system. ?A big mistake is they make backups but they don?t know if they work. We make our clients schedule test backups,? says Kirk Hoaglund, Clientek.
?ABOUT PLANNING
Business plans should include realistic goals, and especially details about interim milestones to be reached and how you plan to get there, says Rick Wall, CEO, Highland Bank. It?s fine to start with a revenue goal, but support it with specific plans such as number of sales people needed, expenses tied to office locations, etc.
