TSBK - Episode 142 - Stephen Brown.png
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Find ways to free up your precious time.

Our guest, Stephen Brown, who is the COO of LedgerGurus, figured this out.

He embraced technology to do the mundane which allows him to do more of the strategic stuff that's hard to automate like budgeting, analysis, and things that bring value to customers.

As a result, he's contributed to the growth of LedgerGurus, a virtual outsourced accounting firm focused on eCommerce accounting, as a company that is determined to help customers make good decisions and achieve their goals.

During this interview, you'll discover...

  • The importance of adding value to your clients

  • The benefits of using technology

  • Where to find the technical tools and best practices

To learn more about LedgerGurus, visit here.

For Stephen's LinkedIn page, click this link.


EPISODE TRANSCRIPTION

Michael Palmer: 01:32 Welcome back to The Successful Bookkeeper podcast. I'm your host, Michael Palmer, and today's show is going to be a good one. Our guest is the COO for Ledger Gurus, a virtual outsourced accounting firm focused on e-commerce accounting before ledger girls, Steven held executive product management, engineering and sales roles at a variety of technology companies. Please welcome Stephen Brown to the show.

Stephen Brown: 02:00 Thank you.

MP: 02:01 Stephen. How are you?

SB: 02:02 I'm good.

MP: 02:03 Great, and I am excited to get into this because I know a lot of our audience tackles technology on a daily basis. It seems there's a lot of messages in the marketplace of where things are going and have gone and you've embraced a lot of this by the sounds of things in not only your business today, but as well your career. But before we get into that, Stephen, tell us about your career path leading up until now.

SB: 02:31 Yeah, I have somewhat of a twisted path. I actually got a bachelor's degree in civil engineering in the late nineties and ended up saw in software due to the.com boom and spent almost 20 years in a variety of roles, um, quickly focusing on information technology software or information security software. So I spent a bulk of my career there and then my wife started our company Gurus as kind of a side hustle that exploded into a full blown business and I jumped off of my software career a couple of years ago to help her full time with ledger groups.

MP: 03:11 Wow, that's an interesting story and an exciting one for your wife and yourself. Um, building a business. What has that been like for you and, and leading into actually growing that business?

SB: 03:29 You know, the, the accounting world is really interesting. Um, the, there's some very interesting parallels to my career in information security software. Um, you know, I think the value that we bring as accountants and bookkeepers is huge, right? We really help our customers understand and make good decisions and not to mention compliance and other things. Uh, and in terms of growth, there's a really huge opportunity in client accounting services, which is where we're focused and, uh, we're growing as quickly as they have in some of my software companies. So it's been, there's been tremendous parallels.

MP: 04:04 Wow. And you're a partner with your, your wife and you have children. How has that been growing the business?

SB: 04:14 It's a tricky balance. We have five kids that range from four to 18, and so it's a, our house is not only our, our home, it's also the headquarters of our business with everybody working from home. And so it's just nonstop from the minute we get up to the minute we go down.

MP: 04:32 Yeah, I'm sure a few, I can definitely relate having young children as well and working from the Home Office, and I'm sure many of our listeners as well, that that is very common in industry and really not just this industry, but many industries where people work from home, their businesses are, are from home. And how do you go about making sure that that works for you and your life and in your family?

SB: 04:59 You know, in our case, we, um, we get some help at home. We have some, um, health that comes in a couple hours a day for our little ones and um, there's a lot of handoff. Um, and sometimes I'm helping get things going in the morning while my wife's going to business meetings or vice versa. And so it's con a constant exchange with us, um, when we're both in it together for both the family and the business. We're constantly trying to help each other out. And so that's how we make it work. But it's, it's not easy. It's tricky for sure.

MP: 05:32 Yeah. And I'm always interested to know what you feel your strengths like as a business owner, as a father, a husband, what do you feel your strengths are that you're bringing to this dynamic?

SB: 05:48 Well, you know, well, I'm very, very operationally oriented. My wife's kind of the crazy entrepreneur who just starts things without thinking. I spend a lot more time on approaching teams systematically. And so both in home life and in the business, I'm really focused on, you know, processees and order and structure and she's, she's focused on getting things started and connections and, and a lot of the people aspects of, of the business.

MP: 06:17 Oh, very cool. Well, it sounds like, uh, you know, we, we, we often bring up, uh, the EMF, which is Michael Gerber's book written for small business. And, and one of the, the concepts in the book is that every business owner or business requires three dimensions. And one of those dimensions is the entrepreneur, one is the manager and one is the technician. And so, yeah. What's Nice about what you've shared is it sounds like two of those dimensions are being handled, um, right away by your, your wife, uh, being the entrepreneur yourself being probably more of the management operations. And then technically sounds probably your wife as well. Maybe even both, you know.

SB: 07:04 Yeah. We, both of us are our technicians, but we also, early on, she, she did not hire any, she did very little client work. Neither of us do much client work. So we hire a lot of technicians and focus on the other aspects of the business.

MP: 07:18 Which is, which is exciting because that is one of the critical things to scaling your business is being able to, to have those roles be be handled. And, and typically what can happen for many, and I'm sure many of our listeners get stuck up in the technical role of the business and the business hits a ceiling when the other two are not being handled. So probably a big piece of why your business has scaled. And so congratulations on that. So you, you've also approached business somewhat differently and that you're very much, uh, embracing technology. Tell us a little bit about how that came to be and obviously, your technical background likely had something to do with that, but I love to hear and have the, the audience hear how that journey went.

SB: 08:09 Yeah. So Brittany wanted a business more or less for herself. She wanted a, a company that was virtual in nature so she could be around the kids and the family. And so from day one, she wanted to wanted it to be virtual. And by that nature there was a strong need for good technology. Uh, and, and we were more cloud based and cloud only from day one. I helped her very much with the, a lot of the IT infrastructure. Um, in the early days while I was working my day job, which involved traveling internationally 25% of the time. So I was super part time in the early days. Brittany is not a technical person unless it's accounting technology. So she, she embraced a lot of the most current and and progressive accounting technology while I was focusing on the non-accounting technology early on that need for the technology to do our business remotely I think made us a technology first company and set the tone for how we approach things. We also look at and technology overservice. So rather than trying to fight the technology and say, hey, that's taken away our service dollars, we just assume, hey, there's going to be other service value that we can bring. So if there's a tool that can do what we would do with this, you know, the person, we always choose the tool first.

MP: 09:34 Interesting. Tell me a little bit more about that.

SB: 09:37 Well, I think, I think the industry has a lot of concern and a valid concern about getting obsolete, becoming obsolete due to technology. And we believe it's inevitable. So rather than trying to run away from it, we embrace it. What we're finding is there's so much work to do that, you know, we spend so much time on the transactional or the fundamental activities that there's a lot of value adding activities that really accountants and savvy bookkeepers can provide on, only can provide. And so we believe that as we can embrace the technology to do the mundane, it freezes up to do more of the strategic stuff, the stuff that's hard to automate, like budgeting and analysis and things of that nature that really bring value to the customers.

SB: 10:28 And so that, that's been our approach from day one.

MP: 10:38 That's refreshing. Uh, and, and definitely a theme in the conversation. People talk about this, but it's really refreshing to hear someone that's experiencing that and actually benefiting from it as well. And I would echo that this is a huge, a huge need to, I love the saying, it's like that bookkeepers and accountants can do and in fact can only do. And so I'd love for you to dig into that a little bit and share some thoughts around that.

SB: 11:13 Well, let's take a budget for example. A budget is, is very complex and it's not something you could give to a piece of software, but behind that budget there's all of this other work that needs to be done to be, to be done correctly. So you need to do all the bookkeeping, you need to do all of the reconciliation, the financial reports. And so all of those things, underlying things that support creating a budget that the technology can, can help streamline our are necessary. But the actual analysis of creating the budget that requires creativity, that requires deep analysis and understanding what's going on. And the end result is something a client can really make good decisions around, give them good controls. That's just one example of where an accountant can provide unique value that a machine is not going to help with. Uh, at least not in the budgeting itself.

MP: 12:08 Yeah, it's exciting. This idea, and I'm sure listeners can totally get that. Totally understand that. And, and yet it's somewhat new territory because I would say I would assert that in the past, all that time, the majority of the time was spent the manual side of getting all of those, the reconciliations, the bookkeeping work done. And so very little time was done on the budget, on cashflow analysis, any kind of consultative approach to the business, what was happening before. And you know, like what's happening now that, that, that that's something that you can actually tackle our business owners embracing that are they asking for, and I love to hear about that.

SB: 12:56 I think small businesses in particular, they, they go through a journey when it comes to their accounting and finances. And initially they are very text focused. They see accounting as something they need to do for their taxes. What we try and do is say like, hey, that's good, but you gotta you gotta move to that next level. And if you're succeeding and a lot of business owners succeed despite their own adequacies, there's, there's another level of accounting and financial insight that's needed. And so then we started looking at financial controls and insights and saying, okay, you had success. Why did you have success? Oh, you want to go invest in this thing? Why? Let's, let's understand. They often will, will make decisions off of hunches and in intuition, which is often how a business initially succeeds, but to scale to scale, you really need to have deeper insights. And so it's transitioning them from a tax compliance mindset to more of a, okay, let's, let's understand our business and let's grow against analysis and data.

MP: 14:05 There's a book called the Challenger Sale, which, which I mean, the name says it all right, challenge your sale is your, you're challenging the customer to think differently, to move in a different direction and actually challenged them on their current assumptions or beliefs and, and it's very powerful and that's what you're, it's by the sounds of it. That's what you're actually positioning and doing. And what a differentiator. If you're sitting in front of a customer and you're saying, hey look, that's all this other stuff that yeah, it's all got to get done. It's all very important to compliance side of things, but wait a second, where here's the opportunity. This is what you need to be thinking on and, and tackling next. And you positioning yourself as the person or firm to actually do that. I absolutely love that.

SB: 14:57 Thanks.

MP: 14:57 What, and you know you, you've mentioned that your wife does more of the business development. She's out dealing with customers. How do you work as a team in terms of, you know, you're handling your part of the business, she's handling her part of the business. What's the function that you apply to make sure that she has some of the thinking that you have and that you're working on so that she's able to take that out into the marketplace?

SB: 15:26 Yeah, so one of the number one questions we get when we tell people we work together is how does that go? A, to be honest, we're, we're very busy in our own areas and I originally came in to focus on operations and technology, maybe help out with marketing, but within a few months she pitched the services side of our business to me because a, I'm much more operationally org oriented and so even though she's the accountant and a very good accountant, I, I'm running all of the accounting services in addition to the operations. The way that we, we stay in sync is, is it helps that we're, you know, we, we share the same house, we're constantly talking about the business and then we have a couple of key meetings during the week where we sync up on items both with our, our top of management managers in the company as well as one on one.

MP: 16:21 Yeah, I'm a, I imagine of question. How is, do you ever get sick of talking about the business?

SB: 16:26 No, we love it. I W I do say sometimes I think we have to stop talking about it because we spent so much talking about the business that we forget that we're, we should also have more of a personal relationship. So it's really easy to just talk about the business all the time and sometimes you just have to put it down and focus on non-business things.

MP: 16:52 It's a great problem to have. You love what you do. You love your wife, you love your family. I mean it's, it's, yeah, it's all kind of combined. Uh, which is an awesome problem to have. But glad that you've identified that and, and there's the human side of, of life as well and making sure the family and the [inaudible] has the whole sold has what it needs. What I'd love to hear from you is there's a big world of technology shift happening. What, what have you seen? That's a two that's taken me two things. I'd love you to, you know, you can tackle either one, but what does really excited you and then this like, wow, this is totally going in an awesome direction. And I'd love to hear some disappointments as well, if any.

SB: 17:35 Well, that's a good question. Um, you know, I spent so much time on, uh, building tools for information technology professionals that it's, it's refreshing to be in a space where there's so much going on. Um, the, the financial technology and accounting technology space is just exploding and there's just so many great tools. So I think from an exciting standpoint, I just, I, you look all around and almost every process there's a tool that can help. And I love that so many of these tools are, are SAS or cloud based. So it really, it makes it a lot easier to implement and use these tools in an efficient manner. And I don't know if I have a favorite tool. There's just so many things, you know, you pick your problem, there's, there's probably a solution for it. In terms of disappointments, I don't know if I'm disappointed so much is I, I would say this transformation that this particular industry is going through is it's big, it's moving very fast and there's, you know, there's a lot of integration that you have to do to make all of your tools work together. So you've got your accounting software, whether it's quickbooks online or Xero or you move up, you get into the net suite of the world and so on. Then you often have to like integrate all these other tools to make a really good workflow and that that can be a complex endeavor. But if done well, it can really create a very powerful financial operating system.

MP: 19:07 It sounds, it sounds that way. And I would say the, what I hear in often, the conversations on this podcast and with, with clients and people in the industry is very, very much that it's a big, big puzzle. Lots of us and pieces in the puzzle. Sometimes they don't fit exactly right now cause there some of the pieces are a little immature need a little shaving. We're cutting to get them in. But it's, it's happening fast. So that's also a big part of the problem is, is keeping up with everything. How do, how does your business and take that into consideration and how do you deal with the rate of change?

SB: 19:44 It's a challenge. And as I looked down the road, I, I worry about the industry and a lot of the professionals out there, I really believe you're going to have to have strong technology skills to enter the transformation. I have an analogy from earlier in my career, I, as I mentioned, I was a civil engineering student and got a job in the late nineties and in that time anybody could work in because they were just hiring anybody that breathed. And so I worked with a lot of people that were not very technical in nature. Um, they came from liberal arts majors, but they, you know, they, they were smart enough to do the groundwork and then around 2001 right when the, when the market blew up, what happened is there was a huge, um, sifting of talent. So everybody that was did not get real skills ended up laid off. And fortunately with my engineering background, I really tooled up and geared up and learn a lot of things and I was, I was able to endure. And nowadays like you, you haven't heard of, of jaw of technology companies not needing talent for, for years and years. And so I think there's a similar need in, in this industry that, that people that are technology forward, I mean really embracing technology are going to thrive. Um, for us that means that we are constantly investing in our, our skills constantly going to events, trainings, developments and we assign people to really dig in and become masters of those tools. So there's a lot of investments but it does pay off over time.

SB: 21:29 And the people that you have working with you as technicians, you're helping them tool up as well. What have you found in terms of knowing that that person that you're hiring is going to have the ability to tool up or desire to tool up? What's that journey look like? Some pros, cons of that would be interesting.

SB: 21:52 That's always a difficult thing to assess. Like how technology savvy are they going to be? We do look for some patterns in the hiring process. We have an assessment that gives us some cognitive insights, but we really look at, we use a lot of tools in the hiring process so we see how well they interact with the tools and how quickly they respond. It's tough. It's tough. Unless we hire somebody that has an explicit um, experience doing any sort of information technology or you're making a little bit of a bet, like, is this person really going to be able to dive in and be good with all the technology that we use?

MP: 22:31 It is, and I say every industry's going to be tackling this because there are so many different pieces to this puzzle. It's like, well, you know, you might have one or two. What's, what's the chances that this person can take that from a one to two, to 10 to 12. And the other challenge is that this is the financial services. There's the ability they have to have the ability, the knowledge is well that technical aspect of accounting and how all that works. And then mixing those two together. What's that been like?

SB: 23:07 You know, it's, it's been pretty easy. You want to say easy, but you, you can kind of tell if a person's got a good accounting knowledge and good quantitative knowledge. Just, you know, if they've made it through a good accounting program, they're probably going to do just fine. If they have good experience in other accounting roles that's usually a good indicator of success. And so you're looking for a marriage of, of people that have the good technical accounting skills along with the, the ability to use technology. And then for us, we're very keen on, we want accountants know how to talk to people because over time that's going to become more and more what we're doing as professionals and less important that we're able to, you know, we've shut our doors and just pound on, on our numbers all day long.

MP: 24:09 Yeah, that's interesting. It's, uh, it's another level as we, as we embrace technology, the, the hope is that they'll actually be more human con contact and working at higher level, which is, which is not what people often think about when it comes to technology. Think of typically moving away from people. Um, but that, that's exciting and refreshing. Now you, you've, you've had a lot of technical background. You've dealt with um, security, uh, in some of your prior roles and this is a big concern for many people. And even something as simple as I was talking with someone recently just about Facebook and privacy and the concerns that they had about that. How do you, how do you, how do you deal with security in your own firm?

SB: 24:58 Well, I have the advantage of almost two decades of being immersed in the information security world, which is a, you know, as a field goes, it's a good place to be that good place to be. There's virtually no unemployment. So I've been able to apply a lot of my experience towards our firm knowing what those best practices should be. Now understanding the threats that are out there. And so I've, I've been able to apply a more sophisticated approach for a small business then than most. And I have the technical skills to use tool that are maybe not as easily adopted by those that are less technically savvy. Well, the way I look at it, we have the most valuable information of almost any business out there, right? We're handling the financials of our clients. And so it's so important that we, we understand what the risks are and understand how to mitigate and manage those risks because they are real and they are happening every day.

MP: 26:05 Absolutely. And you know, for our listener who might not have those skills, what's your recommendation? How should they be? How should they be tooling up in this area?

SB: 26:17 You know, there, there are some best practices out there that you can search for some, there's some basic things that you could do and learn about, but you know, there's some really basic things like, you know, is your data being secured? Is it being encrypted? Right? Are Your laptops being encrypted? Is your, are your devices protected against malware with a good antivirus program? Are you keeping your software up to date and patching it and not ignoring it and saying, oh, I'll reboot tomorrow. Like those, those are some really basic steps that you can take to help protect, you know, the devices that are controlling the data. The next thing that you can look at is most people are using a lot of cloud applications now and so you've got a lot of passwords. I think password security is more important than ever. So things like are you reusing your passwords across sites? Are you using strong complex passwords? And it's really easy to do that with a password manager and there's a number of free password managers out there that you can use. But those are some really good best practices to protect the access to the apps that contain all of the data as well.

MP: 27:29 Absolutely. And is there a recommendation on a password app that you like to use?

SB: 27:34 Oh, you know we're, we're using a paid app called keeper and I'm, a lot of people also use last pass. Those are both cloud-based password managers. But there's a number. If you, if you just Google password manager, you'll see a number of options out there that are really helpful.

MP: 27:51 Wonderful. It's something so simple. I mean it wasn't that long ago where it was like one or two things where you had to have a password and, and now it's literally everything in our life is password protected it seems. So managing that is paramount and some great tips, right? Just something as simple as your passwords where, you know, are you making sure that you have the doors locked up at night type of thing. Um, and, and software, um, updates and making sure all of those things are handled really valuable. I'm always curious too, like if you were thinking in a firm that you needed to get help with security, what would be your recommendation to our listener if they, hey, you know, what, maybe I should have a security review or just have something. Is there anything that you've seen in the market that has been something along those lines?

SB: 28:48 Yeah, I, I've noticed kind of parallel to our industry, the IT services industry, a lot of those businesses are, are putting a strong focus on information security. So there's a number of, of service providers that I've seen out there that will not only help manage the laptops and desktops in your business as well as your servers if you have any, um, but they all, there are many that are starting to orient those services around security. So they'll bring in the, the antivirus and the patch management and a lot of the tools that that can help you secure those, those systems. And it can be a, it can be a really helpful investments to make because they bring the expertise so that you don't have to have it.

MP: 29:35 Absolutely. And I'm sure all of your clients write that. That's a whole nother conversation. Everyone's dealing with other small businesses and so how are they handling it? And understanding yourself is just another area of expertise and knowledge that you can pass on to your clients and be valuable. That's right. Well, this has been amazing, Stephen. I mean, it's a big world. There's so much we don't even understand yet about where, where this is all going. But you've given us a little window into how you're dealing with it powerfully in your business. And thank you so much for generously giving us your time and, and some of your ideas and thoughts of, of your journey.

SB: 30:03 Thank you for having me today. It's been our pleasure.

MP: 30:08 And with that, we wrap another episode of The Successful Bookkeeper podcast. To learn more about today's guests and to get access to all sorts of valuable free business-building resources, you can go to Thesuccessfulbookkeeper.com. Until next time,

MP: 30:36 goodbye.