S02 E05: How to 10X your firm’s efficiency by automating low level tasks

Roman Villard
What’s up everyone? Welcome to the Accounting Flow podcast brought to you by Financial Cents. This podcast is dedicated to taking a deep dive into accounting firm workflow and processes. Each episode we will spend 20 minutes interviewing actual accounting firm owners just like you uncovering specific processes that firm owners and operators encounter on a daily basis and discuss ways to improve them. Let’s go!

Welcome to another episode of Accounting Flow. I’m your host, Roman Villard and today I’m super excited to jump into a conversation on transaction automation, e-commerce accounting and with us we have Michael Astreiko, Founder and CEO of Synder. Michael, thanks for joining.

Michael Astreiko
Yeah, happy to be here. Thank you Roman for inviting me. Yep. And excited to join this conversation.

Roman Villard
Yeah, so we’re gonna hopefully get all of the answers from you on automating heavy volume transactions, and learning more about how Synder can support those initiatives. First, I want to understand how you started Synder kind of the origination story of the company.

Michael Astreiko
Yeah, amazing. It’s really interesting, because I’m not an accountant I am not a bookkeeper. I’m a business owner. I’m a technical guy, just the technical guy. But like five years ago,  I was managing a business with small apps that were like small SAAS apps. Also some of them in the accounting space, and they were accepting PayPal and Stripe. And it was our own problem. Okay, we have PayPal, Stripe, data, and we have QuickBooks Online. How can we bring this data to QuickBooks Online in a way that I can go to QuickBooks Online as a business owner and just understand what plans across channels, across products are selling better? What are the products they’re selling better? Like a bit more information, yeah? About how how’s everything going. And we didn’t find any kind of solution. And we created Synder for ourselves, first of all, just to do our own job. And then we figured out okay, we have several apps, let’s make this app as well, like, make it, launch it. We figured out the case, that there are other SAAS businesses that want to use it. Then we started and more platform because people were saying, Okay, we use also Square, okay, where the Square then we got clients who use Square POS terminals. Then we started like, and we figured out this app started growing much better than everyone else had before. Much faster. We’ll start again. Let’s skip everything else. Focus on Synder. And let’s see what’s happening next. And then COVID happened in 2020. And all our, not all, but like 90% of our Square POS clients, hairdressers, barbers left. I mean gone! As we were sitting with my co- founder she’s like, what should we do? Where should we go? Like, should we allocate online? Are people buying online? Let’s see what’s in the e-commerce space, how are they doing is there? Yeah but, we started going to e-commerce, and we figured out the problems is much higher and much more complex. And we can talk about this a bit later. And like, amount of work that accountants and bookkeepers have to do there are much more higher. And we started working with this industry. And then I did more and more integrations and yeah, doing this. Our bread and butter was always about automating peoples lives, automating workflows, removes the complexity. We start working with accounting firms, we start talking with them, our product team, from that moment till today have like several advisors and different accounting firms from very small ones, with like five bookkeepers, to big ones like coin res, Ni-Co, Bakertilly, whatever. Yep. Ellen Davis, we talk to them as well, to understand their needs and how they see the future and what are the key pain points to automate and to help and to remove from like from just manual work? So the goal of the company was always a designed model with machine accuracy and human approach. And it was like, we want to automate it. But from day one, we’ll also have a very good support and success team to talk to you always, because without human approach, like just doing machine accuracies. It’s not good enough. I think you need to have both. So yeah, this is a story I think, from that.

Roman Villard
Yeah. that’s great. And so I’m interested on a few points there. It sounds like at first you went directly to these retail shops, these companies and you didn’t initially go through partners, is that correct?

Michael Astreiko
Yeah this is correct. We went through marketplaces like QuickBooks Marketplace, Xero Marketplace, yep. Then Shopify Marketplace, of course, it appears that like, primarily, business owners or business managers stopped using us. But then our, like biggest charm happens when, why are you churning? Because I hired an accountant and they don’t know about you. Yeah, okay, go go. Let’s talk about this more.

Roman Villard
Yeah.

Michael Astreiko
Because we also had like, already from day one we already have like bookkeepers and accountants, but it was not our majority of users, yep? And there were four of us. We started saying, Okay,  business owners, great, guys, you can use this completely no question. But let’s talk to accountants, understand what they want in the software, because we understand that one client is great, but one accounting firm can bring multiple clients to your software is much better, just economically speaking.

Roman Villard
Yeah. And that’s a really great unlock for you and your business trying to understand like, what’s the right target market to be selling into? And I’m sure at the same time, you know, COVID happened, you had a lot of churn on those Square accounts, like you said and the accounting conference, scene all closes down, there’s a lot of volatility. What were you feeling at that point in time? Were you nervous? Are you anxious? Like what emotions were going through you’re head?

Michael Astreiko
In the beginning of our business, to be honest, so we launched in 2019, so it was the beginning. It was, I cannot say I was nervous, because we were just in the beginning of the path. And for us, it was, I mean, we didn’t expect it would grow so fast. Anyway, it was okay, but how can we use this opportunity or like, bad situation, to make it better for us? And without COVID, it can happen that we will just focus too much on just SAAS businesses, but we refocus to e-commerce. And it’s like, again, with something, going away, you start thinking about what are the other ways to fill the gap? I cannot say it was not so critical at that moment for us, just because we were in the beginning of what’s possible. If it didn’t work, then it didn’t work. Right now, I will say COVID, would change much more different for us, because the scale of the business and like, you know, the problems that could cause because you have people. At that moment, just at the beginning, was not so good.

Roman Villard
Yeah, It’s interesting to me to hear, you know, the success stories and things that came out of COVID that were highly unexpected, like potentially e-commerce, launching you finding a good channel in the accounting sector. And now we get to see Synder proudly at many of the accounting conferences that we go to.

Michael Astreiko
Yeah.

Roman Villard
I think there’s still a really large segment of accounting firm owners who just get nervous about automation, and they’re in external tools to help with high volume transactions and things like that, that they’re accustomed to exporting into Excel and manipulating and then creating a journal entry in QuickBooks. And so can you help me understand, you know, what are the inflection points? What are those points in time in which an accounting firm owner should say, Okay, I should start evaluating utilizing a tool like Synder for my high volume, potentially ecommerce clients?

Michael Astreiko
Yeah. Great question. It’s like, I would say there are two key points. First key point, when I, I would suggest to do it when you’re onboarding new clients. Of course, because it’s much easier to start using something new when you’re doing New Client Onboarding. Second key point would be, when you are in this tax season, like right now, like from January to April, when you need to do, sometimes you need to do bookkeeping for all last year, maybe for the past couple of years. And again, we suggest that also in the middle of the year. But yeah, I think this is the two main key areas when is the best time to start with new technology. And again, we totally understand that it’s very important for accounting for to bring only solutions that they can trust. And this is why, try with one client, try with a second client, it will be totally fine. We have on our side, we have a success team that will work with you like with first client, with second client. Usually, after the second client, you just have a common Slack channel and you can communicate in there with any question. But after a second, you already know how to set up. Because your setup can be a tricky one I can tell you like because it’s people, sometimes they have questions, like you don’t do it. No, no, we do it, adjust the settings, complex settings, we design it for accountants and for different use cases. So it’s possible to do. Answering question why I have a very good, one of our clients has a very good interview, just this week. And there was one line that we just discussed in a common company meeting. Installation with Synder is faster than downloading a statement. It was like, it was like its gold, it’s a gold mine! This phrase, just this one phrase. It’s a gold mine. And yeah, his bookkeeping firm is doing primarily Stripe and PayPal transactions, 1,000’s of transactions with businesses. So yeah.

Roman Villard
Yeah, so two inflection points for a firm to think about onboarding into Synder. So that’s during the onboarding of a new client. And then when there’s a large amount of cleanup or catch up work that needs to be done and needs to be reconciled. So how about for existing clients? You know, say I’ve got a large book of e-commerce companies that, right now I’m using very manual processes to reconcile their revenue. At what point in like a client lifecycle would you say to me as the accountant, okay, this many transactions or this much in revenue, or these many channels like Synder, could be a really good tool for helping you and your efficiency.

Michael Astreiko
I think every time the firm is going through a process that they review how many hours they spent on different kinds of work, it’s a moot point automated it again. It’s because, it’s like many companies in the industry saying we will save you 100 hours per month, per week, it’s like it’s a buzzword. And we did  just an analysis. And it varies. It varies, a lot, it’s not something you can have, it’s like a temperature in the hospital, you know? I think firm owners or bookkeepers, or whatever doing this job, and they can do it and offshoring, of course, totally clear. And we see this picture. But in any case, calculate the amount of time you spend in there, and amount of time after happening afterwards. Because once you’ve done this, there will be errors, and you need to work with them. How many hours do you spend there? And just give it a try, we can be like free trial almost with no limits. And we can extend it for you. And what we see, because complexities like imagine just simple ecommerce, you have a certified store, you have Amazon store, you have eBay store, you sell across all of them. And in your Shopify store, you accept Amazon pay, and PayPal, and Shopify payment, because you want to have variety. At the end of the month, you have all these Excel spreadsheets from different platforms. And now you have single order paid by two payment methods, because Shopify allows this as well. And how you reconcile it. I mean, again, it’s still possible, it’s still possible to do manually. But if it’s an if it’s like 10 orders, maybe even 100 orders, it’s fine. If it’s 1,000’s, it doesn’t work. Yeah, it just doesn’t scale. And amount of time is just enormous. And if for one client, it can be two hour per week for now, that will be 100 hours per month.

Roman Villard
So you mentioned transaction volume there and you said, you know, maybe if it’s 10s or hundreds, it may be okay to do it the way that you’re doing it. Do you see that there’s a general revenue threshold or a volume threshold where you say, okay, Synder makes a lot of sense for you.

Michael Astreiko
Yeah, for sure. For sure. Of course, it’s not. It’s not for everyone. It’s not for it’s again, if you have a great farming business that sell like I don’t know, seeds, and have like, three checks in a month, each check like $50k, it’s fine. It’s totally fine, but it’s there is no way of Synder. Synder is always, when you have online or POS transactions, and if you have like, hundreds and 1000s, for e-commerce, we’re saying the best fit your client sell across three different channels minimum. Primarily Shopify by Amazon, it can be Etsy, it can be commerce, it can be WooCommerce, Walmart, whatever. But once you have three Shopify channels, that means that you will have at least three to five payment methods. Good luck. So this is a point you need to start. Because otherwise, you’re in bad situation. If it’s SAS business, for example. It’s a bit different story. We will count, because we also do in revenue recognition for primarily b2c SAS businesses. We want to see and say like 1,000 subscriptions. Once your client has other subscriptions, there is a complexity and to do revenue recognition yourself, again, because upgrades, downgrades, cancellations happening during the month, it will be again a tricky one to do by yourself with Excel spreadsheet. So yep, and this, I would say is at least main threshold, but it depends on industry.

Roman Villard
Okay, so let’s take an example in the e-commerce space knowing that generally in order to start looking at and thinking about efficiency tools and automation tools, you want to have three different payment sources. And you want to have a transaction volume that necessitates maybe a larger scale of reconciling efforts for the accountant. Let’s take the example of what happens when, when an accountant is going to close the month with Synder and starting to reconcile these payment methods into financial reporting package. Can you just walk me through what that process should look like? If it’s automated really well?

Michael Astreiko
Yeah, it’s, it’s all about settings and configuration of Synder because it all depends on what you want. First of all, we want to bring all customer data to QuickBooks, for example? If you don’t, skip it. Do you want to do it on daily journal entries? Or do you want to have for each order invoice or sales receipt inside QuickBooks Online, for example? It’s also configurable. We work in both modes, you can have just data summaries. And you will create each data summary for each shopping cart or payment method, yeah? Or we can have a per transaction thing sync and you will have on transaction level details inside QuickBooks. Again, sometimes you need this level of details for more valuations of the company, you may want to have customer report as well there. So just happens as well. And it’s all about settings and configuration that takes like it can take time. It can take like few hours with our specialists, because again, it’s all about how you want to have it and how you want to connect it. Who should be the source of truth like Shopify data? Google’s data? Or maybe from PayPal data should be the main source of truth. Once it’s configured, then it’s like you don’t need to do anything. It’s just happens every hour, every day depends again on your settings, on your plan. And it’s going there. And then the installation process is just, again, it’s varies from platform to platform because in Stripe, you can reconcile with payouts, or with balances in Amazon, you will reconcile with payouts. Again. It’s varies depends on how you can reconcile it, what will be the number to compare in this particular platform.

Roman Villard
Right.

Michael Astreiko
And there will be differences. This is why I’m saying settings and initial conversation is very important because we will show you how to do it in the right way. And what is the right number? I mean, I can tell you that Shopify reports for example. it’s an accrual base report but when you click numbers and start showing your cash base amounts.

Roman Villard
Right, right!

Michael Astreiko
Okay, we have a problem. We have a problem here, yeah? So yeah, but once it’s set up and you know how to do reconciliation, it’s just, at the end of the month you go to Quick Books, you go to clear an account that we create for each payment method and each shipment cards we create a separate payment account. Again, you can configure it you can have all for one, it’s up to you. We recommend doing this way, but it’s not limited, yeah? It’s up to you how you how you prefer to work with your clients. And then just reconcile it with the right number in the external platform and done! It’s like this client said, just easier as closing statements. And again, I’m not promoting Synder unless I’m using it for ourselves. We use Synder for our own Stripe.

Roman Villard
I hope so.

Michael Astreiko
Yeah, exactly. And this is my, like, every month has advanced routine as well like, click one button reconcile down. Next one.

Roman Villard
So it sounds like it’s almost a daily reconciliation effort to where I should be able to go into QuickBooks and see what my revenue is. I should be able to go into my Stripe account. And if my settings are set up correctly, it should be that daily reconciliation to where at the end of the month, then I’m really just comparing two balances because there is that daily automation.

Michael Astreiko
Exactly, exactly. This is what I’m doing. Like, on the first day of every month, I’m going to Stripe open balances, put in like correct timezone, yeah? Certain amount of on the last day and put it to QuickBooks, and just click on this green finish button.

Roman Villard
Yeah, so what I’m curious about on the e-commerce side of things, one of the biggest challenges there is ensuring that inventory is relieved into cost of goods sold really well and matching those up with the sales. How are we ensuring that we can track margins, maybe by SKU or by category? It does Synder support that as well?

Michael Astreiko
Yes. And it’s like you just described it can be by SKU. If it’s a SKU platform, it can be by product catalogue, for example, in Square they recently released catalogues. And you can do it by catalogues. Depends on the commerce platform in Amazon, it will be by skills by skill level, yeah. And in Shopify can be different. But still, it’s part of you how you manage costs, we will take these costs like and product prices, for example, from Shopify, where we can have this information. But in many platforms, we don’t have this information. And we have inside Synder there is a products and services, products tab. And you can upload a list of your products with a date from what date we need to accept applies as prices on the product. So the costs will reflect it correctly. It’s again, it’s a problem, it will require additional work, manual work from your side. Yeah. But again, it is what it is you can sometimes we just have no access to this external platform to get it somewhere where we don’t particularly integration, for example, is also inventory management platforms, like Cin7. Working combined together so that two platforms share the same data layer, and you manage inventory properly in Cin7, and Synder is responsible for doing all reconciliation of payments of mining flow.

Roman Villard
Yeah, that’s really, that’s interesting to me, because, you know, if you’re selling omni channel, and you also have Synder that’s maybe three or four different places that you could be inputting SKU level data on on your costs. And so.

Michael Astreiko
Yeah, but this is what we were warning, don’t do it this way. Yep. This is not what we’re suggesting to do it. We are doing it inside Synder only if you don’t use any kind of third party. We do have clients who use inventory management in QuickBooks, we do have clients who do inventory management in Excel spreadsheet. So it’s also like a weight. So yep, we’re not an inventory management platform. This is the main point, we’re about accounts and reconciliation, we can bring some inventory data, if we have them. We do allow it because it was requested, like you said to have the costs calculated properly. But if you want inventory and if you want to have proper inventory management solution, it should be something different, yep? It should be like,

Roman Villard
Yeah.

Michael Astreiko
Inventory management platform, what you need to do there, and is the best way to do there. And Synder will be responsible only for money flow and for reconciliation of your bank accounts and platforms and shopping carts at the end of the day.

Roman Villard
Totally, totally. And I see the immense value in capturing the sales, the cash, the reconciliation side of it. You know, I also want to make sure that cogs data is appropriately being relieved, right, the inventories appropriately being relieved. And what we see often with e-commerce companies is that for the same SKU, they might have three different SKU numbers with the same product. And they may have different…

Michael Astreiko
For each platform, we have a product map inbetween this one and the final one with QuickBooks like primarily. So inside Synder you can do this product map and per platform. Again, this is what I’m saying, it’s settings. It’s part of settings, its part of your like, there is no law, how you need to do it and some businesses, they will have Shopify Amazon, eBay and they will have one SKU everywhere, done! Amazing business, right? We love you guys. Others are different, and they will be either, they will have like, two of them will have one SKU and this one will be different just because historically it was done this way.

Roman Villard
Right.

Michael Astreiko
You cannot change it. Yeah. So totally fine. Again, this is this is part of settings you have to do it prior to starting to work.

Roman Villard
And this is where you know utilizing a system like Cin7 to manage all of that really well to ensure consistency that then is able to be like flow into Synder makes our lives as accountants much easier. But to your point, there are the system settings that as accountants, we need to make sure our operating really, really well and make sense for the business. And then there’s the data cleansing side of it to ensure that the skewed data is appropriate and consistent across all the channels, and that the cogs data is good. And so as accountants, there’s a lot of work that we need to do to ensure that our clients are set up appropriately to get the most out of the system like Synder.

Michael Astreiko
And like we described, it’s your expertise. Yeah, I would say it’s accountant expertise. And this is what you can sell much more higher, rather than doing manual reconciliation work, yep? So bookkeeping work, it’s this is what we’re trying to promote, is, you still can do it manually. But instead, it’s like we have clients who saying, You know what, we use Synder also for Etsy shop. And you can just try this because it’s the same tool we don’t charge additionally, for additional sales channel, just try it. You just connect to the same app, we connected to the same app will do it. For us is no additional work. Yeah, but for you, it can be an additional channel of selling, or Walmart. It’s a new one. Yep. It’s it’s increasing right now a lot in states. And it’s try it, because we know that we can utilize it the same way as everything else. Just sell the same skills, easier, make it easier for everyone. And this is advisory level that you can do it. And you know, you can continue to use the same tools. And the most important part is, we’re glad to say its no additional cost for you. It will be the same tool set. But it can be a challenge for you to increase your sales. Why not? Why not try it?

Roman Villard
So I want to go back to maybe there’s a slogan or mission statement that you said earlier with with machines and humans, can you can you state that again?

Michael Astreiko
Machine accuracy and human approach.

Roman Villard
Machine accuracy and human approach. I love that because I think a lot of the app partners, the tech ecosystem for accountants, maybe skip the human approach side. And it’s so so important. And it sounds like you guys have focused a lot on ensuring that the customer success, the onboarding, functionalities are really, really smooth, because that is so critical to a firm, yeah, firms workflow and adopting the tool.

Michael Astreiko
Yeah, and we want this, we want this conversation. And this is what we’re telling to allow our accounting partners. We’re technical guys, tell us your pains, we are here to solve them. We are. Again, it’s an honest game. Just to be clear. We don’t want to do everything you will ask about. But we will be very transparent and answer like, you know, multiple requests, same request from different accounting firms, and we will prioritize this task higher. If it’s something unique for your firm, yeah, it can take like some time, I would say because it will have priorities was not a huge company, but a small one. And it will take time. But our product team worked directly also with accountants and like our success team bring all this feedback on a weekly basis for our product team as well in addition to this, so it’s it’s super accurate. Every person in our product team they are with Synder for the last four years at least. And they grow up from being support, being success. And now the product. So know how clients, what clients want, and they understand how adjust their iterations. And again, it’s super important to communicate. This is again, it’s no brainer for us. And I think for accountants, as well. It’s it’s everyone, everyone loves it. And we’re just happy about this. And again, it’s great to hear feedback after after this conversation. So yeah.

Roman Villard
Perfect, perfect. I think that’s a great place to wrap it. I just love the connection that you’re building between the technology piece and the human piece, while also really leaning into automation and making our lives easier, easier through building great product. So if folks want to find you, how can they find you both online? How can they contact you? And then what events are you going to be at this year?

Michael Astreiko
Yeah, this year Scaling New Heights for sure. Stations Form happening next week. We just released integration with Sage Intact. It’s like also very interesting for us. Scaling New Heights, QuickBooks Connect, Xero Con, everything that happened in the States. I mean, we’re trying to participate. They will also be another conference in Toronto, we’ll have people there. So but yeah, primarily these three conferences, Digital CPA as well.

Roman Villard
Yeah.

Michael Astreiko
Engage for sure. I mean, I think I named five of the biggest ones.

Roman Villard
All of them.

Michael Astreiko
Five biggest ones. And also it’s interesting to see how you use Synder tell us again because we figured out that some of our clients for example, they use Synder for hospitality and like nonprofits just because like they have also donations and Stripe, PayPal and they already familiar with the tool and sell it online and hospitality Square POS it’s also there, why not use the same and were want to hear this like what industries we still were serving, but we don’t know. Tell us where you go to go to the our booths and let’s talk about this. We’re very happy.

Roman Villard
Perfect. Perfect. So if people have feedback reach out to Michael and and how can they get ahold of you?

Michael Astreiko
Yeah, it’s funny [email protected]. Just write me directly I’m usually, I’m the one who answering my emails, nobody else managing it. And there for LinkedIn is same. Just LinkedIn Michael Astreiko in one word, and you will find me.

Roman Villard
Perfect and there will be links to contact information in the show notes. And if you want to learn more, you can go to synder.com. Michael, thanks for joining us today. That was fun.

Michael Astreiko
Appreciate Roman. Thank you so much for having me.

Roman Villard
Cool.

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