James Dyson, the founder of innovative vacuum maker Dyson like’s to say “We fix the obvious problems others seem to ignore”. Dyson’s quote resonated with me because for the last 18 months we’ve been the only competitor truly trying to fix the obvious problem of e-invoicing for the masses.

So, today I’m extremely happy to welcome a European competitor, Tradeshift,  who is also attempting to fix the problem. From what we’ve read Tradeshift wants to deliver the same value and vision as billFLO, but to the European Market.  This is great news for our market as a whole, and we’re very excited to see the innovation Tradeshift will bring when they launch.

In the meantime, if you’re a small business that wants e-invoicing and AP automation for your accounting system today, get billFLO for free at www.billflo.com. If you’re an Accounting System or Large Enterprise, integrate billFLO invoices into existing workflows today with our free billFLO API.

billFLO Ian

Wouldn’t it be rewarding to be able to make a living helping your local community? There’s a shining example of a business that does just that – your local hardware store. Here’s a place where customers can buy that lamp for the christmas tree lights, get advice on their next DIY project and even get special stuff ordered in for them (try that at Home Depot!).

What’s probably not apparent though, is that in the back office the hardware store owner is struggling under mounds of paper invoices. Every hammer, trash can and piece of timber ordered results in an invoice! In some cases a mom-and-pop store will have a full time bookkeeper just to deal with the invoices.

So, we’re extra happy to announce today that we’ve got something to make hardware store owners life easier. We’re expanding the billFLO invoice network to enable Do it Best store owners receive their invoices electronically with the billFLO buyer service. That’s right, the network of 4,100 independently owned Do it Best stores can now receive all their Do it Best invoices in billFLO format, straight to their PC. Enjoy!

Since our last big launch we’ve been inundated with requests from eager Accounting System Vendors looking to add billFLO functionality to their offerings. So, I’m happy to announce, that today we’re making billFLO machine readable invoices available to every small business with the launch of our billFLO seller API!

Our launch partner for the API, Clarity Accounting, deployed billFLO in just a few hours for their customers. So, start lobbying your accounting system provider to get you billFLO invoices!

Find out more at www.billflo.com/developer.php

billFLO Ian

Ben Kepes of CloudAve and I have talked previously about making Small Business data common, as a means of allowing it to move where it needs to. This post is somewhat of a response to his post earlier today and another earlier one about OAccounts.

There seems to be a misconception that data needs to be standardized to protect the small business customer.  If everything is standardized then the customer can move wherever they want with their data. The problem is that’s not how it works in reality. 

Lets talk some real-world data portability needs: 

1) Operations Data – Moving operations data is all about freeing a business’s data to flow (intra-company) to the apps they use. This enables the product or service to be delivered most efficiently. 

2) Data Migration – If I want to move from QuickBooks to PeachTree, or MailChimp to Vertical Response I want to take my data with me.

3) Transactional Data – This data is shared inter-, rather than intra- company like Payments, Purchase Orders and Invoices.

The advent of the XML/Restful API means the operations data is being freed up at a very rapid rate. Intuit’s IPP and the Small Business Web are focused on this area. (Disclosure: billFLO is both an Intuit Developer and a member of the Small Business Web). What’s great about this is that the data is not standardized, it’s just fully accessible and open. Take what you need and use it however you want.

The data migration issue is moving a little slower. Some of that boils down to motivation on the part of the incumbents (Do I want to spend time building a back door so my customer can leave?). However, when the data is simple like a feed list or a calendar, standards do work (opml and iCal as examples). But, if we’re talking about complex data, like the data stored in an accounting system – standards don’t work. They are too time-consuming for the vendor to implement and the benefit isn’t there (Updated: A point Dennis Howlett appears to agree with in this old post). The good news is, the API that’s being used to get the operations data exposes all the data you need to migrate to a new app.  

Transactional data is a mixed bag. Payments are obviously automated on proprietary networks. On the other hand, procurement transactions (invoices, purchase orders, etc) have long resisted automation despite many attempts (EDI, ebXML, UBL).  Again, the data is complex and integrating to EDI is a pain. The payback simply isn’t there for the SMB vendors even though the pain is there for the customers. Again the right solution is make the data open, via an API, and let 3^rd party vendors like ourselves do the leg-work of integrations.

It boils down to this. If the data is simple, a standard works. If it’s in any way complex (or is complex to get), open access to the data is the way to go. Either way, the customer gets data-portability.

Your thoughts?

billFLO Ian

From Day 1 we said the aim of billFLO is to completely eliminate the paper invoice.  However, up until now we havent detailed how we are going to achieve that. Well, seeing as we launched the full version of billFLO recently, I think its time to elaborate on why we think billFLO will be world changing.

Every time two companies complete a commercial transaction, purchasing data needs to be passed from the seller’s accounting system to the buyer’s system, via an invoice. Think about this for a second, every time a company buys or sells something, an invoice is generated. Most of the time this invoice is in paper form (about 100 Billion annually). 

Here’s a couple of numbers to give you a sense of the cost of invoicing:
1. Studies show that it costs $14 to get a paper invoice through its lifecylce. At the level of the US economy, that works out as almost 2% of US GDP.
2. 40 billion pieces of paper are wasted every year in the US on paper invoices. That number suggests the world as a whole wastes 120 billion sheets of paper every year on invoices…or 13 Million Trees
3. Imagine the carbon emitted by moving 13 million trees worth of paper invoices around the world, every year.

Up until a couple of weeks back, 99% of business were limited to using a paper invoice and a human to get the data out of one accounting system and into another. Over the years, various different attempts have been made to eliminate the paper invoice from the process, including EDI (Electronic Data Interchange) and PDF invoices. All have failed for various reasons; EDI is too complex to implement for most companies and PDF invoices work for the seller but have to be manually entered into the buyer’s system.

So, rewinding to two years ago, Alec and I were looking at this problem thinking we could solve it.  Despite the fact that many had tried before us, none of the products we looked at had the potential to be ubiquitous. We figured, if we could deliver a solution that made it easy for any size of business to quickly send, receive and import electronic invoices, that product could become a de-facto standard.

billFLO achieves this quite simply by allowing users to email machine readable invoices straight to their customers who can import them straight into their accounting system. Any business can install and be using billFLO in minutes. This usability opens up machine readable, electronic invoices to every single email enabled business in the US.

Time will tell whether our vision will become reality, but by launching billFLO we know we’ve taken the first step on the road to eliminating the paper invoice.

Last week I watched the Corporation, a movie about the evolution of the concept of the corporation. Anoowa is  structured as a corporation and even though we’re young, the film was relevant and thought provoking. Especially the interview with Sir Mark Moody-Stuart, former Chairman of Shell where he remembers befriending a group of protesters in his front garden and how they ultimately shared many of the same concerns. What he didn’t say, but I inferred, is he didn’t have the freedom to act on those concerns due to the constraints on modern companies. 

Maybe its time for some tweaking of the corporation to give CEOs the freedom to inject some of societies values into business? Here’s one such idea I came across on  youtube, which proposes a code of ethics for CEOs. Interesting.

Your thoughts?

P.S. Back in billFLO world, we’re really knuckling down here and looking forward to showing you all something very exciting in the coming weeks. Stay tuned.

We got exciting news on Friday; Ismael Ghalimi of Office 2.0 fame extended an invitation for us to take part in Launchpad at the Office 2.0 conference.

Launchpad is an opportunity for hot startups to meet one-on-one with the thought leaders of Office 2.0, over 50 members of the VC community, and more than 100 analysts, bloggers, and journalists. 

We’re honored and excited! If you’re attending Office 2.0 and would like to meet with us, please contact me.

Do you ever look at something and think “Why do we do it this way?”

Take plastic bags for example. When we go to the supermarket we buy all this stuff and get handed free plastic bags. Raise your hand if you dont already have at least one bag at home that you could have brought with you? Raise your hand if you’ve never seen a plastic blag blowing down the street? The cost to the environment and society are scary.  Why do we continue to use disposable bags? Simple, we haven’t honestly thought about changing our behavior.

In 2002, Ireland introduced a Plastic Bag Tax (PlasTax) equivalant to US$0.20 per bag, with the result that consumption of plastic bags has reduced 90%. Anecdotally, I can tell you the change in behavior was rapid, to the point that it’s almost socially unacceptable to use disposable plastic bags in Ireland.

So, what have plastic bags and paper invoices got in common? They are both in wide spread use, they are both a complete waste of resources and there are ways to replace both of them. What’s needed to reduce the estimated 80 Billion pieces of paper wasted on paper invoices in the US and EU? Two things, the impetus to change business behavior away from paper and substitutes for the paper invoice that are effective. At billFLO we are working on the technical solution, but bigger players than us need to affect the change to behavior. The US has a neutral stance on electronic invoicing (paperless invoicing) from a regulatory perspective. The EU on the other hand has differing regulations across member states. Harmonizing those regulations would be a great step (this is in motion apparantly), but really doesn’t address the behavior change needed. Can you imagine if there was a Paper Invoice Tax? Imagine a 90% reduction in the paper and energy used in creating and transporting paper invoices! The productivity gains and cost reductions of having all our commercial transaction carried out electronically would surely contribute to turning around the recessions and slow-downs many of us are experiencing. It’s a no-brainer to me!

I’m proud that Ireland was the first country in the world to introduce the PlasTax and as an Irish guy, I’ll be very proud if billFLO can contribute to the same type of sea change against paper invoices!

billFLO Ian

Update: This hadn’t occured to me until I just read a post on Techcrunch, but there are parallels between paper invoices and the business cards. Both are a legacy of times and constraints we no longer have. However, moving in any meaningful way to digital business cards will require a really big change in behavior, especially in societies where the business card is part of business culture.

Business services for very-small-businesses is a fast growing industry. I’ve talked about my admiration for FreshBooks before and they really are a poster-child for this burgeoning industry. If my memory serves me correctly, they’ve grown from 0 to 400,000 users in 4 years. Compare that to Microsoft who have been playing in this space since ’94 when they tried to acquire Intuit. I have never been able find any good numbers, but I doubt very much that MS Small Biz Accounting has anything close to 400k users. Freshbooks (and many others like Harvest, Zoho and Xero) are eating Intuit, Sage and Microsoft’s lunch right under their noses! What’s more, as scalable businesses, some of these companies are achieving growth without relying on external investment which means not only are the big companies missing the wave, so are the VCs!

So, you can imagine my excitement when I read on Ben Kepes’ blog, of the upcoming Accounting 2.0 panel he is chairing at Office 2.0 in San Fran. Hopefully he’ll give the Mint.com, Freshbooks, Wesabe and bill.com representatives a good grilling so we can find out what’s the next big wave the big guys are going to let sail by!

I’ll be there!

billFLO Ian

P.S. there’s lots of other cool stuff to check out at Office 2.0 conference: www.O2con.com